Analysis of technical inefficiency in food crop production in Gombe State, Nigeria

ISSN： 1466-4291

Source： Applied Economics Letters, Vol.9, Iss.1, 2002-01, pp. : 51-54

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Abstract

This study investigated technical inefficiency in food crop production among farmers in Gombe State, Nigeria. A stochastic frontier production function, which incorporates technical inefficiency effects, using the Maximum-Likelihood Estimation (MLE), was used as the analytical technique. Given the specification of the stochastic frontier production function, the first null hypothesis, which specifies that the technical inefficiency effects are not stochastic is rejected. The second null hypothesis, which specifies that the explanatory variables in the model for technical inefficiency factors have zero coefficients, is also rejected. This implies that the explanatory variables in the inefficiency effects contribute significantly to the explanation of inefficiency in food crop production in Gombe State, Nigeria. Predicted technical efficiencies vary widely among farms, ranging between 13% and 89%, and a mean technical efficiency of 69%.