The Journal of Fisheries Business Administration (수산경영론집)

The Korean Society of Fisheries Business Administration (한국수산경영학회)
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Model for Price Formation of Fish and Its Demand Structure

어류의 가격형성과 수요구조분석

  • 박환재 (대구가톨릭대학교 경제 통상학부)
  • Published : 2009.06.30
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Abstract

The purpose of this paper is to model price formation and analyze demand structures for fishes under the restriction of Korean fisheries regulations. This study suggests the model that the price of fish is formed by its quantity, expenditure, and habit persistence. In economic literature, such a fishery market demand is called the inverse demand with dynamic habit persistence. Based upon a static differential price formation model, the paper has generalized it dynamically incorporating habit persistence effects. The empirical results show that all the species have values less than one and (-) sign of price flexibilities, thus being price inflexible. The estimated habit adjustment coefficients are significant at the level of 1%. Especially, TAC species have the smaller values of them than those of other main fish species. The contribution and results are summarized as follows. First, the fishery market demand has a strong dynamic effects from habit persistence. Second, the fishery market demand structure could be analyzed in a way different from the ordinary demand analysis, which is based upon price flexibility, scale flexibility, and cross adjustment flexibility. Third, the limitation of this paper is that it ignores the increasing stock effects by catching restrictions, thus raising consumers' benefit in the future.

Keywords

References

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