Comparative technical efficiency of insured and uninsured cocoa farm operators in Ondo State, Nigeria

Abstract

This study evaluates the technical efficiency of insured and uninsured cocoa farm operators in Ondo State, Nigeria. Study data were obtained from 60 insured and 60 uninsured farm operators. Descriptive statistics, stochastic frontier production function and t-test were used for the data analysis. The mean technical efficiency of the insured farm and uninsured farm operators was 76% and 70% respectively. Evidence from the t-test revealed that there was a significant difference between the technical efficiency of the insured and uninsured farm operators (t-cal. = 2.513; p = 0.012). The significant determinants for the output of the insured farm operators were farm size and the cost of pesticides while only the cost of pesticides was significant in determining output for the uninsured farm operators. The study therefore recommends policies aimed at promoting agricultural insurance among cocoa farmers, reducing the cost of pesticides, increasing farm size as well as encouraging young and well-educated individuals to insure their farming activities.nema