Economic Efficiency and Returns to Scale of Yam Production in Southwest Nigeria

Economic efficiency and returns to scale of yam production in Southwest Nigeria were investigated using a Cobb-Douglas stochastic frontier production function which incorporated a model of inefficiency effects. Multistage and random sampling techniques were used to select 320 yam farmers. Farm level data were collected from the farmers using pre-tested interview instruments. Results indicated mean economic efficiency levels of 0.94, 0.96 and 0.93 for all farms (wetland & upland farms together), upland and wetland farms respectively. Production factors of labour and material inputs significantly influenced yam output. Farm specific variables such as educational level, household size and farm size were significant factors implicated for the observed variations in inefficiency. Returns to scale analysis showed constant, increasing and decreasing returns to scale for all farms, upland and wetland farms respectively. Further improvement in economic efficiency would be achieved through increased variable inputs utilization by the upland farmers and otherwise for the wetland farmers, and the expansion of extension services to accommodate integrated farming system and more efficient management skills.