IDEAS home Printed from https://ideas.repec.org/a/bla/canjag/v58y2010i2p215-234.html
   My bibliography  Save this article

A Seasonal Inverse Almost Ideal Demand System for North American Fresh Tomatoes

Author

Listed:
  • Jason H. Grant
  • Dayton M. Lambert
  • Kenneth A. Foster

Abstract

Increased fresh tomato trade has prompted a number of trade disputes between the United States, Canada, and Mexico. One precondition of an antidumping dispute is meeting the “likeness of product” criterion. However, fresh tomato shipments and imports are highly seasonal, suggesting that the degree of substitutability (or product likeness) may depend fundamentally on whether fresh tomato varieties are in‐ or out‐of‐season. We develop a seasonally adjusted inverse demand system using Canadian and Mexican monthly import data along with U.S. state shipping data to address both seasonality and product substitutability in the fresh tomato market. We find that market equilibrium and the degree of product substitution are affected by seasonality and product availability in the consumer choice set. Le commerce accru de la tomate fraîche suscite des différends commerciaux entre les États‐Unis, le Canada et le Mexique. L'une des préconditions d'un différend en matière d'antidumping est liée au respect du critère de la « similarité du produit ». Toutefois, les expéditions et les importations de tomate fraîche sont très saisonnières, ce qui laisse supposer que le degré de substituabilité (ou de similarité du produit) puisse reposer fondamentalement sur le fait qu'il s'agisse ou non de variétés de tomate fraîche pleine saison ou hors‐saison. Nous avons mis au point un système désaisonnalisé de la demande inverse utilisant des données mensuelles sur les importations canadiennes et mexicaines et des données sur les expéditions des États‐Unis pour étudier la saisonnalité et la substituabilité dans le marché de la tomate fraîche. Nous sommes arrivés à la conclusion que la saisonnalité et la disponibilité des produits offerts au consommateur influent sur l'équilibre du marché et le degré de substitution du produit.

Suggested Citation

  • Jason H. Grant & Dayton M. Lambert & Kenneth A. Foster, 2010. "A Seasonal Inverse Almost Ideal Demand System for North American Fresh Tomatoes," Canadian Journal of Agricultural Economics/Revue canadienne d'agroeconomie, Canadian Agricultural Economics Society/Societe canadienne d'agroeconomie, vol. 58(2), pages 215-234, June.
    • Handle: RePEc:bla:canjag:v:58:y:2010:i:2:p:215-234
    DOI: 10.1111/j.1744-7976.2009.01176.x
    as

    Download full text from publisher

    File URL: https://doi.org/10.1111/j.1744-7976.2009.01176.x
    Download Restriction: no
    File URL: https://libkey.io/10.1111/j.1744-7976.2009.01176.x?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    References listed on IDEAS

    as
    1. Wu, De-Min, 1973. "Alternative Tests of Independence Between Stochastic Regressors and Disturbances," Econometrica, Econometric Society, vol. 41(4), pages 733-750, July.
    2. VanSickle, John J. & Evans, Edward A. & Emerson, Robert D., 2003. "U.S.-Canadian Tomato Wars: An Economist Tries to Make Sense Out of Recent Antidumping Suits," Journal of Agricultural and Applied Economics, Cambridge University Press, vol. 35(2), pages 283-296, August.
    3. Eales, James S. & Unnevehr, Laurian J., 1994. "The inverse almost ideal demand system," European Economic Review, Elsevier, vol. 38(1), pages 101-115, January.
    4. Estes, Edmund A., 2003. "Tomato Wars: A Discussion of How International Trade, Structural Changes, and Competitiveness Affect the North American Produce Industry," Journal of Agricultural and Applied Economics, Southern Agricultural Economics Association, vol. 35(2), pages 1-7, August.
    5. Kleibergen, Frank & Paap, Richard, 2006. "Generalized reduced rank tests using the singular value decomposition," Journal of Econometrics, Elsevier, vol. 133(1), pages 97-126, July.
    6. Moschini, GianCarlo & Vissa, Anuradha, 1992. "A Linear Inverse Demand System," Journal of Agricultural and Resource Economics, Western Agricultural Economics Association, vol. 17(2), pages 1-9, December.
    7. Davis, George C. & Jensen, Kimberly L., 1994. "Two-Stage Utility Maximization And Import Demand Systems Revisited: Limitations And An Alternative," Journal of Agricultural and Resource Economics, Western Agricultural Economics Association, vol. 19(2), pages 1-16, December.
    8. Giancarlo Moschini, 1995. "Units of Measurement and the Stone Index in Demand System Estimation," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 77(1), pages 63-68.
    9. Cook, Roberta L. & Calvin, Linda, 2005. "Greenhouse Tomatoes Change the Dynamics of the North American Fresh Tomato Industry," Economic Research Report 7244, United States Department of Agriculture, Economic Research Service.
    10. Adolf Buse, 1994. "Evaluating the Linearized Almost Ideal Demand System," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 76(4), pages 781-793.
    11. T. S. Breusch & A. R. Pagan, 1980. "The Lagrange Multiplier Test and its Applications to Model Specification in Econometrics," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 47(1), pages 239-253.
    12. Newey, Whitney & West, Kenneth, 2014. "A simple, positive semi-definite, heteroscedasticity and autocorrelation consistent covariance matrix," Applied Econometrics, Russian Presidential Academy of National Economy and Public Administration (RANEPA), vol. 33(1), pages 125-132.
    13. Hausman, Jerry, 2015. "Specification tests in econometrics," Applied Econometrics, Russian Presidential Academy of National Economy and Public Administration (RANEPA), vol. 38(2), pages 112-134.
    14. Barten, A. P. & Bettendorf, L. J., 1989. "Price formation of fish : An application of an inverse demand system," European Economic Review, Elsevier, vol. 33(8), pages 1509-1525, October.
    15. Krissoff, Barry & Kuchler, Fred, 2007. "Mandatory Country-of-Origin Labeling: Will It Benefit Consumers?," Amber Waves:The Economics of Food, Farming, Natural Resources, and Rural America, United States Department of Agriculture, Economic Research Service, pages 1-2, May.
    16. Thompson, Gary D., 2003. "Retail Demand For Greenhouse Tomatoes: Differentiated Fresh Produce," 2003 Annual meeting, July 27-30, Montreal, Canada 21946, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
    17. Padilla-Bernal, Luz E. & Thilmany, Dawn D. & Loureiro, Maria L., 2003. "An Empirical Analysis of Market Integration and Efficiency for U.S. Fresh Tomato Markets," Journal of Agricultural and Resource Economics, Western Agricultural Economics Association, vol. 28(3), pages 1-16, December.
    18. Estes, Edmund A., 2003. "Tomato Wars: A Discussion of How International Trade, Structural Changes, and Competitiveness Affect the North American Produce Industry," Journal of Agricultural and Applied Economics, Cambridge University Press, vol. 35(2), pages 313-319, August.
    19. Richards, Timothy J. & Patterson, Paul M., 2003. "Competition in Fresh Produce Markets: An Empirical Analysis of Marketing Channel Performance," Contractor and Cooperator Reports 291973, United States Department of Agriculture, Economic Research Service.
    20. Yang, Seung-Ryong & Koo, Won W., 1994. "Japanese Meat Import Demand Estimation With The Source Differentiated Aids Model," Journal of Agricultural and Resource Economics, Western Agricultural Economics Association, vol. 19(2), pages 1-13, December.
    21. Deaton, Angus S & Muellbauer, John, 1980. "An Almost Ideal Demand System," American Economic Review, American Economic Association, vol. 70(3), pages 312-326, June.
    22. Godfrey, Leslie G, 1978. "Testing against General Autoregressive and Moving Average Error Models When the Regressors Include Lagged Dependent Variables," Econometrica, Econometric Society, vol. 46(6), pages 1293-1301, November.
    23. Hoanjae Park & Walter N. Thurman, 1999. "On Interpreting Inverse Demand Systems: A Primal Comparison of Scale Flexibilities and Income Elasticities," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 81(4), pages 950-958.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Abdoul G. Sam & Babatunde O. Abidoye & Sihle Mashaba, 2021. "Climate change and household welfare in sub-Saharan Africa: empirical evidence from Swaziland," Food Security: The Science, Sociology and Economics of Food Production and Access to Food, Springer;The International Society for Plant Pathology, vol. 13(2), pages 439-455, April.
    2. Huang, Kuo S., 2013. "Consumer Welfare Effects of Quantity Changes in Demand," Journal of Agricultural and Applied Economics, Cambridge University Press, vol. 45(2), pages 217-227, May.
    3. Suh, Dong Hee & Guan, Zhengfei & Khachatryan, Hayk, 2017. "The impact of Mexican competition on the U.S. strawberry industry," International Food and Agribusiness Management Review, International Food and Agribusiness Management Association, vol. 20(4), April.
    4. Peguero, Felipe & Kennedy, P. Lynn & Zapata, Hector O., 2018. "A Generalized Dynamic Inverse AIDS Model for Fresh Fruits and Vegetables: An Application to the U.S. Bell Pepper Industry," 2018 Annual Meeting, February 2-6, 2018, Jacksonville, Florida 266686, Southern Agricultural Economics Association.
    5. H. Holly Wang & Paul Gardner de Beville, 2017. "The media impact of animal disease on the US meat demand," Agribusiness, John Wiley & Sons, Ltd., vol. 33(4), pages 493-504, September.
    6. Sam, Abdoul G. & Abidoye, Babatunde & Mashaba, Sihle, 2021. "Climate change and household welfare in Sub-Saharan Africa: empirical evidence from Swaziland," LSE Research Online Documents on Economics 106700, London School of Economics and Political Science, LSE Library.
    7. Florkowski, Wojciech J. & Carew, Richard, 2011. "An Analysis of Price Determination in the Sweet Cherry Markets of British Columbia, Washington, Oregon and California," 2011 International Congress, August 30-September 2, 2011, Zurich, Switzerland 114352, European Association of Agricultural Economists.
    8. Riccardo Testa & Anna Maria di Trapani & Filippo Sgroi & Salvatore Tudisca, 2014. "Economic Sustainability of Italian Greenhouse Cherry Tomato," Sustainability, MDPI, vol. 6(11), pages 1-15, November.
    9. Luke, Jaime R. & Tonsor, Glynn T. & Brown, D. Scott, 2024. "Wholesale pork demand: Understanding primal-level heterogeneity," Journal of Commodity Markets, Elsevier, vol. 34(C).
    10. Valdez-Lafarga, Octavio & Schmitz, Troy, 2016. "A Country-Differentiated Import Demand Model for Fresh Tomatoes in the United States: an Estimation of Price and Income Elasticities for 1991 through 2014," 2016 Annual Meeting, July 31-August 2, Boston, Massachusetts 235807, Agricultural and Applied Economics Association.
    11. Huang, Pei, 2014. "An Inverse Demand System for Blue Crab in the Chesapeake Bay: Endogeneity and Seasonality," 2014 Annual Meeting, July 27-29, 2014, Minneapolis, Minnesota 169827, Agricultural and Applied Economics Association.
    12. Peyton Ferrier & Chen Zhen, 2014. "The producer welfare effects of trade liberalization when goods are perishable and habit-forming: the case of asparagus," Agricultural Economics, International Association of Agricultural Economists, vol. 45(2), pages 129-141, March.
    13. Fausto Cavalli & Ahmad Naimzada & Lucia Parisio, 2021. "Learning in a double-phase cobweb model," Decisions in Economics and Finance, Springer;Associazione per la Matematica, vol. 44(2), pages 579-611, December.
    14. Yeong Tey & Mark Brindal, 2014. "Adapting importation policy to global commodity markets: implications of rice import allocation in Singapore," Mitigation and Adaptation Strategies for Global Change, Springer, vol. 19(8), pages 1277-1293, December.
    15. Pei Huang, 2015. "An Inverse Demand System for the Differentiated Blue Crab Market in Chesapeake Bay," Marine Resource Economics, University of Chicago Press, vol. 30(2), pages 139-156.
    16. Ning, Xin & Grant, Jason H. & Peterson, Everett B., 2021. "Estimating Structural Change in the Japanese Beef Import Market in the Wake of BSE: A Smooth Transition Approach," Journal of Agricultural and Resource Economics, Western Agricultural Economics Association, vol. 47(01), January.
    17. Perez, Maria P. & Ribera, Luis A. & Palma, Marco A., 2017. "Effects of trade and agricultural policies on the structure of the U.S. tomato industry," Food Policy, Elsevier, vol. 69(C), pages 123-134.
    18. Li, Sheng & Wu, Feng & Guan, Zhengfei & Luo, Tianyuan, 2021. "How trade affects the US produce industry: the case of fresh tomatoes," International Food and Agribusiness Management Review, International Food and Agribusiness Management Association, vol. 25(01), September.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Peguero, Felipe & Kennedy, P. Lynn & Zapata, Hector O., 2018. "A Generalized Dynamic Inverse AIDS Model for Fresh Fruits and Vegetables: An Application to the U.S. Bell Pepper Industry," 2018 Annual Meeting, February 2-6, 2018, Jacksonville, Florida 266686, Southern Agricultural Economics Association.
    2. Yeboah, Godfred & Maynard, Leigh J., 2004. "The Impact Of Bse, Fmd, And U.S. Export Promotion Expenditures On Japanese Meat Demand," 2004 Annual meeting, August 1-4, Denver, CO 19978, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
    3. Grant, Jason H. & Foster, Kenneth A., 2005. "An Inverse Almost Ideal Demand System of Fresh Tomatoes in the U.S," 2005 Annual meeting, July 24-27, Providence, RI 19193, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
    4. Chris Moore & Charles Griffiths, 2018. "Welfare analysis in a two-stage inverse demand model: an application to harvest changes in the Chesapeake Bay," Empirical Economics, Springer, vol. 55(3), pages 1181-1206, November.
    5. Perez, Maria P. & Ribera, Luis A. & Palma, Marco A., 2017. "Effects of trade and agricultural policies on the structure of the U.S. tomato industry," Food Policy, Elsevier, vol. 69(C), pages 123-134.
    6. Asche, Frank & Zhang, Dengjun, 2013. "Testing Structural Changes in the U.S. Whitefish Import Market: An Inverse Demand System Approach," Agricultural and Resource Economics Review, Cambridge University Press, vol. 42(3), pages 453-470, December.
    7. Sean Pascoe & Peggy Schrobback & Eriko Hoshino & Robert Curtotti, 2023. "Impact of changes in imports and farmed salmon on wild-caught fish prices in Australia," European Review of Agricultural Economics, Oxford University Press and the European Agricultural and Applied Economics Publications Foundation, vol. 50(2), pages 335-359.
    8. Russell Davidson & Victoria Zinde‐Walsh, 2017. "Advances in specification testing," Canadian Journal of Economics/Revue canadienne d'économique, John Wiley & Sons, vol. 50(5), pages 1595-1631, December.
    9. Denni Tommasi, 2016. "Household Responses to cash Transfers," Working Papers ECARES ECARES 2016-20, ULB -- Universite Libre de Bruxelles.
    10. Adrian C. Darnell, 1994. "A Dictionary Of Econometrics," Books, Edward Elgar Publishing, number 118.
    11. Steen, Marie, 2006. "Flower Power at the Dutch Flower Auctions? Application of an Inverse Almost Ideal Demand System," 2006 Annual Meeting, August 12-18, 2006, Queensland, Australia 25441, International Association of Agricultural Economists.
    12. Pablo del Río & Desiderio Romero & Marta Jorge & Mercedes Burguillo, 2012. "Territorial differences for transport fuel demand in Spain: an econometric study," Chapters, in: Larry Kreiser & Ana Yábar Sterling & Pedro Herrera & Janet E. Milne & Hope Ashiabor (ed.), Green Taxation and Environmental Sustainability, chapter 4, pages 56-68, Edward Elgar Publishing.
    13. Huang, Pei, 2014. "An Inverse Demand System for Blue Crab in the Chesapeake Bay: Endogeneity and Seasonality," 2014 Annual Meeting, July 27-29, 2014, Minneapolis, Minnesota 169827, Agricultural and Applied Economics Association.
    14. Gabrielyan, Gnel & Marsh, Thomas L., 2012. "Domestic and Export Price Formation of U.S. Hops," 2012 Annual Meeting, August 12-14, 2012, Seattle, Washington 124722, Agricultural and Applied Economics Association.
    15. Robert H. Beach & Matthew T. Holt, 2001. "Incorporating Quadratic Scale Curves in Inverse Demand Systems," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 83(1), pages 230-245.
    16. Lakka, Spyridoula & Michalakelis, Christos & Varoutas, Dimitris & Martakos, Draculis, 2012. "Exploring the determinants of the OSS market potential: The case of the Apache web server," Telecommunications Policy, Elsevier, vol. 36(1), pages 51-68.
    17. Gary Wong & Qiao Yu, 2001. "Inverse Demand Systems for Composite Liquid Assets: Evidence from China," School of Economics and Finance Discussion Papers and Working Papers Series 097, School of Economics and Finance, Queensland University of Technology.
    18. Palm, F.C., 1981. "Structural econometric modelling and time series analysis towards an integrated approach," Serie Research Memoranda 0004, VU University Amsterdam, Faculty of Economics, Business Administration and Econometrics.
    19. K. K. Gary Wong & Hoanjae Park, 2018. "Consumption dynamics in inverse demand systems: an application to meat and fish demand in Korea," Agricultural Economics, International Association of Agricultural Economists, vol. 49(6), pages 777-786, November.
    20. Rodrigo García Arancibia & Edith Depetris Guiguet, 2020. "Brazilian Import Demand of Dairy Products with Emphasis in the Mercosul Context [Demanda brasileira de importações de laticínios com ênfase no contexo do Mercosul]," Nova Economia, Economics Department, Universidade Federal de Minas Gerais (Brazil), vol. 30(2), pages 551-577, May-Augus.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:bla:canjag:v:58:y:2010:i:2:p:215-234. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Wiley Content Delivery (email available below). General contact details of provider: https://edirc.repec.org/data/caefmea.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.