This study examines income generation potential and resource-use efficiency of 120 aquaculture farms in Oyo state Nigeria. The data collected were analyzed using gross margin and stochastic frontier production (SFP) model. Result of gross margin (GM) shows that the farms were quite profitable with an average GM of N207, 000 per annum. The SFP model reveals that, elasticities of all considered inputs were positive and significantly different from zero. Returns to scale of 1.16 computed as sum of the inputs elasticities suggests that, an average farm from the study exhibits increasing returns to scale. Further analyses reveal that, an average technical efficiency estimate of about 81% was obtained from SFP model. This suggests that, about 19% potential yield are forgone due to inefficiency from the study. The result of sources of technical efficiency differential shows that extension; education, stocking density, and credit significantly influenced technical efficiency of the farms. Also, result of simulated marginal effects of these variables on technical efficiency shows that extension has the highest marginal effects on the efficiency estimates followed by credit, education, and stocking density. The study, therefore, suggests that, significant level of profit obtained from the study is synonymous to improve efficiency environment observed among the farms as promotion of aquaculture development has the potential in alleviating household income poverty in the country.
___
Aigner, D.J., Lovell, C.A.K. and Schmidt, P. 1977. Formulation and estimation of stochastic frontier production models. Journal of Econometrics, 6: 21-32.
Battese, G.E. and Coelli, T.J. 1995. A model for technical ınefficiency effects in a stochastic frontier production for panel data. Empirical Economics, 20: 325–332.
CBN 2006. Annual Report and Statement of Account of Central Bank of Nigeria for the year ended 31st December, 2005.
Coelli, T.J., Rao, D.S.P., O’Donnell, C.J. and Battese, G.E. 2005. An Introduction to efficiency and Productivity Analysis. 2nd Edition. Springer, New York, 254 pp.
Coelli, T.J. 1996. A Guide to FRONTIER version 4.1c: A Computer programme for Stochastic Frontier production and Cost Function Estimation. Working paper 96/07, Centre for Efficiency and Productivity Analysis Dept. of Econometrics, University of New England, Armidale, Australia.
FAO 2005. Report of the FAO-Worldfish center workshop on Small-Scale Aquaculture in Sub-Saharan Africa: Revisiting the Aquaculture target group Paradigm. FAO Rome Publication. ftp://ftp.fao.org/docrep/ fao/008/a0038e/a0038e00.pdf.
Fapohunda, O.O., Ojo, S.O. and Balogun, A.M. 2005. Analysis of Productivity of Bio-technical Factors and Technical Efficiency of Aquaculture Production in Ondo State, Nigeria. Journal of Animal and Vertinary Advances, 4(5): 535-539.
Farrell, J.M. 1957. The Measurement of Productive Efficiency. J. Royal stat. 120 (III): 253-290.
Horrell, S. and Krishan, P. 2007. Poverty and productivity in female headed Households in Zimbabwe. Journal of Development Studies, 43(8): 1351-1380.
Kareem, R.O., Dipeolu, A.O., Aromolaran, A.B. and Akegbejo, S. 2008a. Analysis of technical, allocative and economic efficiency of different pond systems in Ogun State, Nigeria. African Journal of Agricultural Research, 3(4): 246-254.
Kareem, R.O., Dipeolu, A.O., Aromolaran, A.B. and Williams, S.B. 2008b. Economic efficiency in fish farming: hope for agro-allied industries in Nigeria. Chinese Journal of Oceanology and Limnology, 26(1): 104-115.
Kodde, D.A. and Palm, F.C. 1986. Wald Criteria for Jointly Testing Equity and Inequality Restrictions. Econometrica, 54: 1243-1248.
Meeusen, W. and van den Broeck, J. 1977. ‘Efficiency estimation from Cobb-Douglas Production Functions with Composed Error’, International Economic Review, 18: 435-444.
Ojo, S.O. and Fagbenro, O.A. 2004. Poverty Reduction Strategy in Nigeria –Improving productivity and Technical Efficiency in Artisanal Fisheries in Niger Delta Region. Paper presented at the 12th Bi-annual conference of the International Institute of Fisheries Economics and Trade (IIFET), Tokyo, Japan.
Ojo, S.O., Fagbenro, O.A. and Fapohunda, O.O. 2006. Productivity and Technical Efficiency of Aquaculture Production In Nigeria- A Stochastic Frontier Production Function Approach. World Aquaculture. 37(3): 18-23.
OYSADEP 2005. Annual publication of Oyo State Agricultural Development Project. Ibadan Oyo state Nigeria.
Schubert, R. 1994. Poverty in Developing Countries, its Definition, Extent and Implications Economics, 49/50: 17-40.
Wilson, P., Hadley, D. and Ashby, C. 2001. The influence of management characteristics on the Technical Efficiency of Wheat Farmers in Eastern England. Agricultural Economics, 24: 329-338.