Technical Efficiency of Small Scale Farmers: An Application of the Stochastic Frontier Production Function on Fish Farmers in Ibadan Metropolis

Abstract

This study aimed at assessing the technical efficiency of fish farmers in Ibadan metropolis of Oyo State, Nigeria using the stochastic frontier production function analysis. Primary data were collected using a set of structured questionnaire from 82 fish farmers in Ibadan metropolis, Oyo State, Nigeria. The stochastic frontier function estimated for the 82 respondents showed that the mean efficiency value was 0.906. Majority of the fish farmers of about 65.9 percent are over 90 percent efficient and about 34.1 percent had technical efficiency ranging from 50 percent to 90 percent, based on the use of input. The distribution of results also showed that fish farmers in Ibadan metropolis are more efficient in the use of inputs though not all the inputs. There are farmers who gain more by reducing the inputs (e.g. labour use) for the same level of output. Changing the input combinations can thereby increase the farm level of efficiency. The farmers in the study area therefore need to use their available input intensively and rationally so as to produce better output and be technically efficient.