Small is Beautiful: Empirical Evidence of an Inverse Relationship between Farm Size and Productive Efficiency in Small-Holder Cassava Production in Ideato North LGA of Imo State

Okoye, B.C, Agbaeze, C.C, Asumugha, G.N, Aniedu, O.C and Mbanaso, E.N.A (2009): Small is Beautiful: Empirical Evidence of an Inverse Relationship between Farm Size and Productive Efficiency in Small-Holder Cassava Production in Ideato North LGA of Imo State. Unpublished.

Abstract

This study examined the relationship between farm size and technical efficiency in small holder cassava production in Ideato LGA of Imo state using data from a 2008 farm-level survey of 90 rural households. The study showed a strong inverse relationship between farm size and technical efficiency. Smaller farms are found to be more technically efficient, than larger farms. These results favour land redistribution policies targeted towards giving lands to the small-holder farmers. Policies of de-emphasizing cassava production in the estate sector while encouraging it in smallholdings will foster equity and efficiency.

• Item Type: MPRA Paper
• Language: English
• Keywords: Farm Size, Productivity and Technical Efficiency
• Subjects: D - Microeconomics > D6 - Welfare Economics; D - Microeconomics > D6 - Welfare Economics > D61 - Allocative Efficiency; Cost-Benefit Analysis

References

Aigner, D., Lovell, C., Schmidt, P., (1977). Formulation and estimation of stochastic frontier production function models. J. Econometrics 6:21–37.

Ajibefun, I. A and Daramola, A.G. (2003) Efficiency of Micro Enterprises in the Nigerian Economy. AERC Research paper 134. African Economic Research Consortium, Nairobi

Ajibefun, I.A and Aderinola, E.A (2004) Determinants of Technical Efficiency and Policy Implication in Traditional Agricultural Production: Empirical Study of Nigerian Food Crop Farmers. Final Report Presentation at Bi-annual Research Workshop of African Economic Research Consortium. Nairobi, Kenya.

Barret, C.B. 1996. “On Price Risk and the Inverse Farm Size-Productivity Relationship.” Journal of Development Economics 51(369): 193–215.

Battese, G.E., Coelli, T.J., (1988). Prediction of firm-level technical efficiencies with generalised frontier production function and panel data. Journal of Econometrics 38:387-399.

Berry, A., and W. Cline. (1979). Agrarian Structure and Productivity in Developing Countries. Baltimore: Johns Hopkins University.

Bharadwaj, K. (1974). Production Conditions in Indian Agriculture: A Study Based on Farm Management Surveys. Cambridge, UK: Cambridge University Press.

Coelli, V.J (1996) Guide to Frontier Version 4.1: A Computer Program for Stochastic Frontier Production and Cost Function Estimation. Department of Economics, University of New England, Armidale, Australia.

Cornia, G.A. 1985. “Farm Size, Land Yields, and the Agricultural Production Function: An Analysis for Fifteen Developing Countries.” World Development 13(4): 513–34

Ezulike, T. O., Nwosu, K. I., Udealor, A. and Eke- Okoro, O. N. (2006). Guide to Cassava Production in Nigeria. Extension Guide No. 16. National Root Crops Research Institute, Umudike, Nigeria. 10 pp.

FAO (2007). Food and Agriculture Organisation, Database Results.

Farrel, J.M (1957) The Measurement of Production Efficiency. Journal of Royal Statistics Society. Series A General Vol: 120, Part III.

Gul Unal, F (2008). Small Is Beautiful: Evidence of an Inverse Relationship between Farm Size and Yield in Turkey. Working Paper No. 551, The Levy Economics Institute P.O. Box 5000 Annandale-on-Hudson, NY 12504-5000.

Hazarika, G and Alwang, J. (2003) Access to credit, plot size and cost inefficiency among smallholder tobacco cultivators in Malawi. Agricultural Economics 29:99-109

Heltberg, R. 1998. “Rural Market Imperfections and the Farm Size-Productivity Relationship: Evidence from Pakistan.” World Development 26(10): 1807–26.

Masterson, T (2007) “Productivity, Technical Efficiency, and Farm Size in Paraguayan Agriculture”. The Levy Economics Institute of Bard College. Working Paper No. 490, Feb. 2007.

Meeusen N. and Van den Broeck, J (1977). Efficiency estimation from Cobb Douglas prodduction function with composite error. International Economic Review , Vol 18(2) pp: 123-134.

Okoye, B.C, Onyenweaku, C.E and Asumugha, G.N. (2007). Allocative Efficiency of Small-Holder Cocoyam Farmers in Anambra State, Nigeria. The Nigerian Agricultural Journal. Vol.38 (2007). Pp. 70-81

Okoye, B.C., C. E. Onyenweaku, O. O. Ukoha, G. N. Asumugha and O. C. Aniedu (2008). Determinants of Labour Productivity on Small-Holder Cocoyam farms in Anambra State, Nigeria. Academic Journals Scientific Research and Essay. Vol 3(11): 559-561

Okoye, B.C., Onyenweaku, C.E and Agwu, A.E (2008) Technical Efficiency of Small-Holder Cocoyam Farmers in Anambra State, Nigeria: Implications for Agricultural Extension Policy. Paper presented at the 13th Annual Conference of the Agricultural Society of Nigeria (AESON) Book of Abstracts, Held at the Micheal Okpara University of Agriculture, Umudike. April, 8-11, 2008

RMRDC (2004). Raw Materials Research and Development Council. Cassava: Report on Survey of Selected Agricultural Raw Materials in Nigeria. 210 pages

Seyoum, E., (1996). Technical efficiency and productivity of maize producers in eastern Ethiopia: A study of traditional farmers and those within the Sasakawa-Global 2000 agricultural project, Unpublished Master of Economics Dissertation, Department of Agricultural and Resource Economics, University of New England, Armidale.