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Price Transmission And Households Demand Elasticity For Frozen Fish Under Fuel Subsidy Reform In Delta State, Nigeria

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  • Odemero, Achoja Felix

Abstract

Fuel subsidy removal is assumed to translate to general increase in the cost of operating business such as fish marketing.The response of price of fish and corresponding demand elasticity are welfare issues worthy of investigation in Nigeria. The present study evaluates price transmission in fish marketing system by analysing the response of fish market indices to fuel subsidy reform in Nigeria. Primary data collected with structured questionnaire from purposively selected 78 frozen fish marketers, were analysed with descriptive statistics and regression model. A test of hypothesis shows a significant price transmission of about 100% (P < 0.05). Marketing cost increased by 31.8% and profitability dropped by 24.20%, confirming negative effect of new price regime. The result further revealed a 0.05% drop in quantity of frozen fish demanded by households. It was recommended that economic measures should be introduced by the government to cushion the effect of fuel policy removal.

Suggested Citation

  • Odemero, Achoja Felix, 2013. "Price Transmission And Households Demand Elasticity For Frozen Fish Under Fuel Subsidy Reform In Delta State, Nigeria," International Journal of Food and Agricultural Economics (IJFAEC), Alanya Alaaddin Keykubat University, Department of Economics and Finance, vol. 1(1), pages 1-10, July.
    • Handle: RePEc:ags:ijfaec:156839
    DOI: 10.22004/ag.econ.156839
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    References listed on IDEAS

    as
    1. Aguero, Jorge M., 2004. "Asymmetric Price Adjustments And Behavior Under Risk: Evidence From Peruvian Agricultural Markets," 2004 Annual meeting, August 1-4, Denver, CO 20394, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
    2. Jochen Meyer & Stephan von Cramon‐Taubadel, 2004. "Asymmetric Price Transmission: A Survey," Journal of Agricultural Economics, Wiley Blackwell, vol. 55(3), pages 581-611, November.
    3. Minot, Nicholas, 2010. "Transmission of World Food Price Changes to African Markets and its Effect on Household Welfare," Food Security Collaborative Working Papers 58563, Michigan State University, Department of Agricultural, Food, and Resource Economics.
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