• P-ISSN 0974-6846 E-ISSN 0974-5645

Indian Journal of Science and Technology


Indian Journal of Science and Technology

Year: 2008, Volume: 1, Issue: 5, Pages: 1-8

Original Article

Assessing capital resource mobilization and allocation efficiency of small scale cereal crop farmers in Benue State, Nigeria


Mobilizing capital resources and ensuring their efficient utilization have been a major issue facing small-scale farmers of Nigeria. This study examined the capital resource mobilization methods and allocation efficiency of small-scale cereal crop farmers in Benue State. Three hundred and seventy small-scale cereal crop farmers were selected from six local government areas of Benue State and studied using a multistage sampling technique. Field data were collected using structured questionnaire which was administered to 378 farmers as interview schedules. The data were analyzed using simple descriptive statistics and inferential statistics, of stochastic frontier production function model. The findings of the study indicated that the cultivated farm sizes of the surveyed cereal crop farmers ranged between 0.5 hectares and 10 hectares with a mean of 3.01 hectares. Further analysis indicated that the sum of the coefficients of the significant variables of the stochastic frontier cost model (0.75) was less than unity implying decreasing return to scale. This implies that the farmers are operating at the second stage of the classical production function, indicating that the farmers are efficiently utilizing the capital resources mobilized. The estimated sigma squared (0.63) was significantly different from zero at the 1% level while the magnitude of variance ratio was estimated to be high at 0.83, thus confirming the relevance of the stochastic frontier model used. Majority of the cereal crop farmers (73%) operated at an allocative efficiency range of between 1.1 and less than 1.2. This suggests that most of the respondents operated at high efficiency levels in allocating capital resources mobilized.

Keywords: Agricultural production, allocative efficiency, capital resource mobilization, economy, small scale farmers, Benue State, Nigeria. 


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