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http://dx.doi.org/10.5762/KAIS.2018.19.2.387

The plan of stabilizing Gyeongnam Chung-yang Green Pepper Farm Income  

Hwang, Min-Ji (Department of Food and Resource Economics, Pusan National University)
Jeong, Ho-Jung (Department of Food and Resource Economics, Pusan National University)
Cho, Jae-Hwan (Department of Food and Resource Economics, Pusan National University)
Publication Information
Journal of the Korea Academia-Industrial cooperation Society / v.19, no.2, 2018 , pp. 387-396 More about this Journal
Abstract
This study examined the instability factor of real income and net profits of Chung-yang Green Pepper Farm through an analysis of the operating costs. Furthermore, this paper suggests a plan for stabilizing the price by shipment adjustments resulting from an analysis of the price elasticity by A Linear Approximated Inverse Almost Ideal Demand System (LA/IAIDS). The income instability factor of the farm based on an analysis of the operating costs was attributed to the unexpected loading of utility expenses and collapse of the price due to oversupply at a specific point in time. On the other hand, this is insufficient to completely explain the income instability factor of Chung-yang Green Pepper Farm because a price collapse does not include the monthly price changes. An analysis of the price and scale flexibility of Chung-yang Green Pepper Farm by monthly data showed that annual farm net yield increases by 1.21% due to a 2.21% increase in price if the shipment quantity is reduced to 1% a year. In summary, a plan that supports the farm price received through declining shipments in winter is effective in stabilizing the income of farms. Because Chung-yang Green Pepper in Gyeongnam region has an especially high market share of 82.5%, the prices and income of Gyeongnam Chung-yang Green Pepper farms can be stabilized effectively if they form an association of producers around the Gyeongnam region and adjust the shipment.
Keywords
Chung-yang Green pepper; Analysis of operating costs; Inverse almost ideal demand system; Price flexibility; Scale flexibility;
Citations & Related Records
Times Cited By KSCI : 2  (Citation Analysis)
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