Econometric analysis of resource-use efficiency and profitability in cowpea-based farming systems of Ondo State, Nigeria

<p class="MsoNormal" style="text-align: justify; text-justify: inter-ideograph; line-height: 120%; mso-pagination: none; layout-grid-mode: char; mso-layout-grid-align: none; punctuation-wrap: simple; text-autospace: none; margin: 12.0pt 0cm 6.0pt 0cm;"><span lang="EN-US" style="font-size: 10.0pt; mso-bidi-font-size: 11.0pt; line-height: 120%; font-family: 'Times New Roman',serif;">This study assessed the efficiency of resource use and profitability in cowpea-based farming systems among smallholder farmers in Ondo State, Nigeria. Data were collected from 160 respondents using a multistage sampling technique and a structured questionnaire. Analytical tools included descriptive statistics, gross margin analysis, and a Cobb-Douglas production function estimated via Ordinary Least Squares (OLS). Results indicated that cowpea production is highly profitable, yielding a return on investment (ROI) of 4.26, meaning that every ₦1 invested generates ₦4.26 in return. The gross margin and net profit per hectare were ₦932,881.08 and ₦885,100.39, respectively. The Cobb-Douglas model showed that farm size, fertilizer, cowpea seed, and agrochemicals significantly and positively influenced output, whereas labor had a significant negative effect. The estimated returns to scale (0.43) suggested decreasing returns to scale. Further analysis of Marginal Value Product (MVP) and Marginal Factor Cost (MFC) revealed underutilization of land and agrochemicals, and overapplication of labor. Major constraints identified included high transportation costs, price instability, environmental hazards, and limited access to capital and market information. The study concludes that while cowpea farming remains economically viable, addressing technical inefficiencies and systemic barriers is essential for enhancing productivity and profitability.</span></p>