Resource Use Efficiency and Returns to Scale in Aquaculture Production in Ogun State

Aquaculture in Ogun State, in Nigeria's South West geopolitical zone, has expanded as a commercially significant enterprise serving both local and Lagos metropolitan food markets. As production scales grow, questions of resource use efficiency and whether the sector operates under increasing, constant, or decreasing returns to scale become important for guiding investment and policy. This study analyses resource use efficiency and returns to scale in aquaculture enterprises in Ogun State using data collected from 180 fish farmers through structured questionnaire interviews across three aquaculture clusters. A Cobb-Douglas production function was estimated using ordinary least squares to determine factor output elasticities and returns to scale. Resource efficiency ratios were computed to identify over- and under-used inputs. Allocative and economic efficiency scores were derived using the standard frontier approach. Results indicate that the aggregate production elasticity was 1.28, confirming increasing returns to scale across the sample. Feed, fingerling quantity, and pond size were all statistically significant production determinants. Resource use efficiency analysis reveals that feed was the most over-applied input, with an efficiency ratio of 0.61, suggesting that current feed application levels exceed the optimal quantity relative to prevailing feed prices and output values. Fingerlings were marginally under-applied. The study concludes that profitability gains are available through feed management optimisation rather than simple expansion of pond area. Recommendations include promotion of precision feed management and feed conversion ratio monitoring training for fish farmers in Ogun State. Keywords: resource use efficiency, returns to scale, aquaculture, Cobb-Douglas, Ogun State