ABSTRACT

The study examined the economics of mushroom production in Abia State, Nigeria. It identified the constraints militating against mushroom production, analyzed costs and returns, profit function and their determinants, as well as allocative efficiency. A purposive sampling technique was used in selecting 30 mushroom farmers each from the three Agricultural Zones of Abia State. A well structured questionnaire was use to collect data on the research variables between January — December 2008. Descriptive statistics were employed in the analysis of socio-econornic characteristics and the constraints. Economic efficiency was analyzed using Translog stochastic profit function. The Maximum Likelihood Estimation Technique (MLE) was employed in estimating the function while t-test was employed in testing their determinants. The mushroom enterprise in the study area made an aimual profit per farmer and annual profit per hectare per farmer of N61,3 13.96 and NlO,792.81 respectively. Also, the result for allocative efficiency showed that the farmers did not optimally allocate their inputs. The farmers were found to underutilized variables like land size and capital inputs (W1 >1) while other inputs like spawn and cassava peels are over utilized (W1 <l). The Translog Stochastic profit function first order parameters depicted that profit increases with price of labor input farm size and decreases with depreciation. Output variables are greatly explained by inefficiency as depicted by variance pararneter (0.95). Similarly, age, education and membership of cooperative Society positively influence efficiency while farm size, farming experience negatively influence efficiency and length of training was negative and statistically not significant. Therefore, policies that would encourage education and training of mushroom farmers through effective and intensive extensive service as well as encourage farmers to form cooperative societies in the study area are advocated.