Off-Farm Work and Profit Efficiency among Small-Scale Farmers in North-Central Nigeria

Abstract

The study evaluated profit efficiency within the context of off-farm work participation among small-scale farmers in North-Central Nigeria. The population of the study comprised participants and non-participants in off-farm work. Multistage sampling technique was used to select 360 respondents for the study. Data for the study were obtained from primary source with the aid of standard questionnaire and analysed using descriptive statistics and profit efficiency model. Findings showed that participants and non-participants had average farm sizes of 3.69ha and 3.59ha, incurred average fertiliser costs of N312.77 and N246.23 per kg respectively. While farm size significantly (p < 0.01) increased profit for participants and non-participants, average fertiliser cost reduced profit for non-participants. In the diagnostic statistics, sigma squared (σ²) was significant for participants (p < 0.01) and non-participants (p < 0.05). Gamma (γ) was high (0.9870) and significant (p < 0.01) for non-participants indicating high profit inefficiency. Farm family labour significantly (p < 0.05) increased profit inefficiency among participants but reduced profit inefficiency among non-participants. Participants had significantly (p < 0.01) less average profit than non-participants. It was concluded that participation in off-farm could make farm enterprise unattractive and impair food production. Hence, participants in off-farm work should improve farm production cost management in order to shore up their gross farm profit.

Keywords: efficiency, farmers, non-participants, North-Central Nigeria, off-farm, participants, profit, stochastic frontier