1.1    Background Information
Nigeria as a developing country will continue to emphasize on the role of agriculture in her development programme. Incidentally, Nigerian agriculture is in the hands of the small scale farmers who are faced with multiple problems-which ultimately reduce farm output. As agricultural production is shifting from subsistence to commercial and modernized level, it becomes necessary for intensive research to be carried out on continuous basis. The scientific findings got from the research stations require specialists to translate them to a form understandable by the small scale or peasant farmers.

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     The proper adoption and utilization of improved technologies by the farmers is fundamental for the realization of increase production levels, and subsequent transformation of agricultural sector of the national economy of most developing nations. Similarly, the improved technologies being developed in the Research Institutes and Universities must not only be transmitted to the farming population in their rural communities, but also be delivered in the language that the farmers would understand. The importance of agricultural extension which is an integral part of educational process is designed to assist the farmers to help themselves in achieving their set objectives.

     Agricultural extension and has a major role to play in the transformation of agricultural sector of the national economy. The extension agents help the farmers through teaching and demonstration to take full advantage of the research findings and technological advantages, quickly to adjust to the seasonal and economic conditions, and effectively use support services to increase their production and income level. Therefore, without extension guidance, farmers are unable to exploit fully the opportunities available to them. (Umebail, 2003).
     Extension services cannot make a significant impact on agricultural production if funds required for the advise are not available. Funding is a crucial factor in extension service delivery. Fund is required to enable the extension services reach the farmers. It can also facilitate extension advise through teaching the farmers who do not even know how to use available fund and input judiciously, efficiently and profitably, Liot (1998), observed that technology cannot by itself develop agriculture if the conveyer is absent. He added that the conveyer is money or fund, and that technology cannot reach the entrepreneur unless funds are available for him to acquire it. Extension funding is one of the most critical of all the constraints facing extension services, especially in developing countries.
     Ebonyi State Agriculture Development Programme (EBADEP) which is one of the agencies that renders extension service to the farmers in the state aims at implementing a well organized, disciplined and supported performance oriented extension service capable of assisting small-holder farmers to adopt relevant technologies to increase their food production and income level. The State A.D.P. witnessed poor and irregular funding for some times now, and the budget estimate were far from being realized (EBADEP, 2003). Unavailability and/or inadequate funding often impede the effectiveness of extension service. This is one of the most serious problems that can disrupt adoption and practices of new agricultural pushed to the farmers by extension agents in the state. Therefore, there is need for this research work to assess the Funding of Public Agricultural Etension Service in Ebonyi State in a Deregulated Economy
1.2    Problem Statement
It is generally accepted that agricultural extension services have long been recognized as an important factor in promoting agricultural development (Anderson and Feder, 2003). According to Oladele (2008), agricultural development in many developing countries in hinged on extension services by helping farmers to identify, analyze and link with research on their production problems. He also discussed awareness on opportunities for improvement of farm yields leading to increased income and better standard of living. Over the years, the top-down model of public extension services has dominate in many developing countries (Ali et al, 2008).
Nevertheless, in recent past, performance of public extension has been generally disappointing (Hansra and Ashigura, 1998). The clientele were not satisfied with the existing public extension service provision; and the concern for huge financial investment on public extension service, insufficient impact of services and limited accountability of the extension personal makes the extension specialists and policy makers to propose privatization and or commercialization of extension services in most developing countries (Umali and Schwartz, 1994). Oladele (2008) and Bawa et al (2009) noted that until recently, extension is solely organized and funded by the governments with several obstacles to its effective delivery. Public sector extension has been facing criticism for its cost and lack of efficiency, hence privatization of extension services (Bawa et al, 2009). Furthermore, Oladele (2008) opined that the debate to privatize extension services in Nigeria is being muted, due to wide spread corruption and inefficiencies in public corporations.
Again, the government’s dwindling development budget and extremely poor progress in raising economic and social well-being of the populace through public extension has led to the call for private sector involvement in the provision of extension service (Alfred and Adepoju, 2006). the extension service programmes in Nigeria has been faced with the problems of inadequate funding and untimely release of fund by the sponsors and/or donor agencies. Tunde (1998) indicated that, now that the World Bank loan is gradually being withdrawn, extension budget is declining and facilities are degenerating and public extension services in the country are heading for collapse. Eziakor and Isitor (1997) equally observed that the major problems militating against the accelerated growth and development of agricultural sector in Nigeria is inadequate fund.
Ebonyi State Extension Service is not different from the Nigerian extension service system with regard to funding problems. To this end, it becomes necessary to assess the funding of Ebonyi State agricultural public extension service in a deregulated economy. In order to achieve this, the study seeks to answer the following research questions.
·        What are the socio-economic characteristics of the respondents?
·        What are the major recommended packages/technologies extended to the farmers?
·        What is the nature of the trend in the funding of agricultural extension services in Ebonyi State between 2001 and 2010?
·        How willing are the farmers to pay for extension services rendered by the state ADP?
·        What factors determine farmers’ willingness to pay for extension service?
·        What are the constraints militating against farmers willingness to pay for extension service?

1.3   Objective of the Study
The broad objective of this study is to assess the funding of Ebonyi State agricultural public extension service in a deregulate economy. Specifically, the objectives include to:
(i)                Describe the socio-economic characteristics of the respondents;
(ii)             Identify the major recommended packages/technologies and service extended to the farmers by the extension agents;
(iii)           Describe the trend in the funding of agricultural extension services in Ebonyi State between 2001 and 2010;
(iv)           Ascertain farmers’ willingness to pay for extension services rendered by the ADP;
(v)              Analyses the effects of farmers’ socio-economic characteristics on their ability to pay extension services;
(vi)           Identify constraints against farmers’ willingness to pay for extension services in a deregulated economy.
1.4       Hypothesis
The null hypothesis tested is stated hereunder:
HO1: Socio-economic characteristics of the farmers do not have significant effect on their willingness to pay for extension services.

1.5 Justification for the Study
            The development planners and policy makers are becoming very much interested in the privatization (deregulation) of extension service in Nigeria. Dimula & Madukwe (2001) pointed out that there is increasing interest among development planners and policy makers in the privatization of extension service in Nigeria. They further stated that the poor performance of the public extension service caused by gross financial difficulty has given rise to the search for alternative option. The alternative option, therefore, is funding agricultural extension service in a deregulated economy, since whatever affects funding also affects other aspects of the extension system. Agumage (2001), observed that adequate funding is strategies to sustainable agricultural extension. He also stated that whatever affects funding adversely affects other aspects of extension system including provision of communication and other logistic supports. Hence, the relevance of this study.
            This overview of funding Ebonyi State Agricultural Extension Service in a derefulated economy would suggest the need for farmers to evaluate the usefulness of extension agency and their potential for funding agricultural extension system. Farmers and other stakeholders in Agriculture will become more serious with extension activities if they are required to pay for the services rendered by the extension agents.
            This study would innovation ownership, increased adoption rate and acceptability of new technologies. The study will also enhance linkages between the various actors in agricultural extension such as the researchers, farmers, extensionists and inputs providers, thereby increasing learning from each other.
            Ebonyi State is said to be one of the major food producing states in Nigeria, and has to be studied to assess the funding situation of agricultural extension service in a deregulated economy, thus exposing the way forward for improving the effectiveness and efficiency of extension system. It will also help the stakeholders in making appropriate decision in who and how to fund extension service.
            This work will serve as a guide to agricultural agencies and government in decision making and implementing a better and more realistic funding of extension service programmes especially for the rural farmers.
            Finally, the work will, serve as reference material for studies; other interested individuals and government who may wish to carry out projects in the related field and improvement on the agricultural sub-sector of the economy respective

3.1 The Study Area
The study area is Ebonyi State, which lies approximately 7°3'N and longitudes 5°4'E and 6°45'E and located in the eastern part of Nigeria. The state is made up of thirteen (13) local government areas, which are divided into three (3) agricultural zones, namely, Ebonyi North, Ebonyi Central and Ebonyi South. It has a landmass of approximately 5,932 square kilometers. It is bounded in the East by Cross River State, in the North by Benue State, in the West by Enugu State, and in the South by Abia State (EBMOI, 2005).
Ebonyi state has a population of 2.1 million people (NPC, 2006). The vegetation of the state is a mixture of savanna and semi-tropical forest with agriculture as the mainstay of the economy. It lies in an area of moderate relief of between 125m and 245m above sea level The soil is texturally clay loam, fairly to poorly drained with gravely subsoil in some locations especially the upland adjacent to lowland areas (Ekpe et al, 2005). Crops grown in the area include; rice, yam, cassava, cocoyam, groundnut, cowpea and vegetables. Livestock farming, especially the extensive system of rearing sheep, goats and native cattle, is also
practiced by the people. Fishing activities are predominant in the southern zone of the state.
Ekpe et al (2005) noted that two main seasons prevail in the area - the rainy (wet) season, which spans from early April to early November, and the dry season, which lasts from late November to early April. However, a short dry spell is usually experienced during the month of August, and this is termed the August break. Lowland areas popularly called, Fadamas are largely available and serve as good sites for rice and dry season, vegetable farming.
Some non-farm activities prevalent in the state include petty trading, blacksmithing, pottery and weaving. Medium to large-scale industries also exist in the state. Notable among them are the Abakailiki rice milling industry, the fertilizer blending plant and the building materials industry. Large deposits of solid mineral resources such as lead, gypsum, limestone, marble stone, and common salt are common in Ebonyi State (EBMO1, 2005).
The state operates public agricultural extension service through the Ebonyi State Agricultural Development Programme (EBADEP), For the purpose of convenience and easy reach out to the rural farmers, EBADEP operates three agricultural zonal structure (Ebonyi North Zone, Ebonyi Central Zone and Ebonyi South Zone). These zones are further divided into
blocks with Ebonyi South zone having five (5) blocks, and Ebonyi North and Ebonyi Central zones having four blocks each. Each block is made up of eight (8) circles with each circle being administered by an extension agent (EBADEP,2001).
3.2 Sampling Technique
A multistage sampling procedure involving simple random sampling techniques was adopted for this study. First, a simple random sampling technique was used to select six (6) out of the thirteen (13) extension blocks in the state (i.e. two (2) extension blocks from each agricultural zone). Second, four extension circles were randomly sampled, giving a total of 24 extension circles. Next, a list of contact farmers in each of the 24 extension circles as compiled by EBADEP served as the sample frame. From this, a simple random sampling was used to select ten (10) contact farmers from each of the 24 extension circles to give a total of two hundred and forty (240) respondents for the study.
3.3 Data Collection
This study involved the use of cross-sectional data and time series data obtained from primary and secondary sources. The primary data were collected by the use of structure questionnaire administered to the respondents. This was augmented by interview schedule in cases where the respondents are illiterates. Secondary data were collected from existing relevant EBADEP records. These data were those of recommended packages/technologies extended to the farmers and the funding of EBADEP between 2001 and 2010.
3.4Analytical Technique
Data collected were analyzed using both descriptive and inferential statistics. Descriptive statistics such as frequency distribution tables, percentages and mean as well as graphical representations were used to analyze objectives (i), (ii), (iii) and (iv). Objective (v) was analyzed using the Probit Multiple Regression analysis. While factor analysis was used to analyze objective (vi).
3.5       Model Specification
3.5.1 Probit Multiple Regression Model
The probit model was used to capture the effect of farmers' socio-economic characteristics on their willingness to pay for extension services. The relationship between the probability of the willingness to pay (WTP) and its determinants is given as:
WTPi  =   f (Xh X2, X3, X4, X5, X6, X7; X8)……………(i)
Explicitly it is given as
WTP1  = ao + a11 + a2 + a3 X + a4X4 + a5X+ a6X+ a7X7 + a8+X8 + et- …… (ii)
WTPi = Probability of the willingness to pay for extension services by the farmer (Yes = 1, No = 0)
X1        =          Farmer’s age (Years)
X2        =          Farmer’s sex (male = 1, female = 0)
X3        =          Farmer’s sex educational level (years)
X4        =          Farmer’s frequency of extension contacts (Number of visit per month)
X5        =          Farmer’s farm income (naira)
X6        =          Farming experience of the farmer (years)
X7        =          Farm size (Ha)
X         =          Farmers’ household size
et         =          Stochastic error term
ao - as  =          Parameters estimated.
            Apriori, it is expected that the coefficient of X3, X4, X5, X6 and X7 will be positively signed while those of X1 and X8 will be negatively signed. The coefficient of X2 will take either positive or negative value. The basic OLS assumptions were made in adopting the multiple regression analysis.        
3.5.2 Ordinary Least Square (OLS) Assumptions
            Those assumptions are classified by Koutsoyiannis (1977) as Stochastic Assumptions and Assumptions concerning the independent variables.
Stochastic Assumptions
            These assumptions concern the distribution of values of the random (error) term, µ. Specifically, the stochastic assumptions address the values of the random term,  µ and how this random term adapts the OLS method to the stochastic nature of economic phenomena. These assumptions include:
(a)  The Random Term, µ is a Radom Real Variable (RRV)
(b)  The Mean Value of µ in any Particular Period is Zero (MV µ =0 at a Particular Time)
(c)  Assumption of Homoscedasticity (AOH)
(d)  Assumption of Normality of Random Term, µ (NRT)
(e)  The Random Terms of Different Observation are Independent
(f)   The Random Term, µ is Independent (RTI) of the Explanatory Variable(s)
(g)  The Explanatory Variables are Measured without Error (VMWE)
Assumption Concerning the Independent Variable
      These assumptions concern the independent variables, and include:
(a)  The Explanatory Variables are not Perfectly Linearly Correlated.
(b)  The Macro Variables should be Correctly Aggregated.
(c)   The Relationship Being Estimated is Identified
(d)  The Relationship is Correctly Specified
3.6 Hypothesis Testing
      The null hypothesis was tested using F-test at 0.05 level of significance.
F-test model
F – cal = R2 (N-K)_
           1 – R2 (K-1)

Where R2 = coefficient of determination
  =          Sample size
K   =          Number of variables
Decision rule: If F cal>F-tab accept null hypothesis, otherwise reject.
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