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Estimates of Price and Expenditure Elasticities of Demand for Imported Orange and Domestically Produced Fruits in Korea

Authors: Noh, Sujeong; Noh, Sujeong;

Estimates of Price and Expenditure Elasticities of Demand for Imported Orange and Domestically Produced Fruits in Korea

Abstract

The Rotterdam demand model, first proposed by Theil and Barten, is used to find estimates of price and expenditure elasticities of imported fruits and domestically produced fruits in Korea. This model consists of 6 demand equations of apple, pear, tangerine, sweet persimmon, orange and banana. The major implications with the estimates of individual price and expenditure elasticities are summarized as follows. The demand for orange is expected to increase by 38.1% if seasonal duties would be abolished in 2018 in accordance with the Korea-U.S. free trade agreement. Also the demand for Korean pear would decrease by 19.9% as a consequence of the substitution effect. We also found that price elasticity of imported orange with respect to the demand for Korean tangerine is not statistically significant. This implies that Korean tangerine is mostly sold from Oct. to Feb. while imported orange is mostly sold from Mar. into the summer months every year.

Keywords

imported orange, Demand and Price Analysis, domestically produced fruit, Rotterdam demand model

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selected citations
These citations are derived from selected sources.
This is an alternative to the "Influence" indicator, which also reflects the overall/total impact of an article in the research community at large, based on the underlying citation network (diachronically).
BIP!Citations provided by BIP!
popularity
This indicator reflects the "current" impact/attention (the "hype") of an article in the research community at large, based on the underlying citation network.
BIP!Popularity provided by BIP!
influence
This indicator reflects the overall/total impact of an article in the research community at large, based on the underlying citation network (diachronically).
BIP!Influence provided by BIP!
impulse
This indicator reflects the initial momentum of an article directly after its publication, based on the underlying citation network.
BIP!Impulse provided by BIP!
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