A study was carried out to investigate into factors responsible for technical inefficiency of food crop farmers in the oil polluted and non-polluted areas of Niger Delta. Data were collected from 270 (140 for oil polluted and 130 in unpolluted area) farmers selected through a multistage random sampling technique. A stochastic frontier function that incorporated inefficiency effect was estimated using the Maximum Likelihood Estimation (MLE) technique. The MLE of the stochastic production function revealed mean technical, efficiency of 78% in polluted area while the corresponding values in unpolluted area were 88%. The most efficient farmer had the technical efficiency (TE) of 0.93 and least efficient farmer of 4.48. Farmers with efficiency index between 4.48 and 0.65 constituted 31% while 68.2% of the farmers had efficiency index between 0.70 and 0.95. The predicted technical efficiency varied widely across farms between 28 and 86% for farmers in polluted area while between 38 and 96% for the farmers in unpolluted area. The results show that farmers generally in the study area are not technically efficient, although the farmers in the unpolluted area are relatively more efficient than farmers in the polluted area. The implications are that the policies that would reduce oil pollution and encourage farmers to utilize their resources optimally should be put in place. Hence, in order to halt the continual degradation of the Niger Delta environment there is need for the enactment and enforcement of stringent environmental laws to protect the area.
Key words: Nigeria, Niger Delta, stochastic function, oil pollution, technical efficiency, food crops farmers.
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