Agricultural Research Management Information System

Home
Research Summary
Search
About Us
- ARMIS
- Brochure
Contact Us
Report
User Request
Data Input
Help
- Operation Manual
  - PDF
  - Video
- Program Area & Commodity
We have reached 37600 number of research entries at this moment.

- Logout

Research Detail

Home
Research
Detail

Demand for Fish in Asia: a Cross-country Analysis*

Madan Mohan Dey
Aquaculture/Fisheries Department, University of Arkansas at Pine Bluff, USA

Yolanda T. Garcia
Department of economics, University of the Philippines at Los Baños, Laguna, Philippines

Kumar Praduman
Division of Agricultural Economics, Indian Agricultural Research Institute, New Delhi, India

Somying Piumsombun
Department of Fisheries, Ministry of Agriculture and Cooperative, Bangkok, Thailand

Muhammad Sirajul Haque
Department of Economics, University of Chittagong, Chittagong, Bangladesh

Luping Li
Center for Chinese Agricultural Policy, Chinese Academy of Sciences, Beijing, China

Alias Radam
Faculty of Economics and Management, Universiti Putra Malaysia, Selangor, Malaysia

Athula Senaratne
National Aquaculture Development Authority, Colombo, Sri Lanka

Nguyen Tri Khiem
Faculty of Economics, An Giang University, Vietnam

Sonny Koeshendrajana*
Ministry of Marine Affairs and Fisheries, Jakarta, Indonesia

Abstract/ Executive Summary:

Fish demand patterns in nine Asian countries were investigated using a multistage budgeting framework allowing a disaggregated approach to analysing fish consumption. This paper highlights the heterogeneity of fisheries products in terms of species, sources and cultural responses of consumers, factors that are important in fish demand under the Asian setting. Specifically, fish demand by income groups were compared to determine how the low- and high-income households respond to price and income changes. Results showed that the estimated price and income elasticities of all fish types included in the study were relatively more elastic among the poorer households.

Keywords: Asia; Fish demand; Inverse Mills ratio; Multistage budgeting framework; Price and income elasticity; Quadratic AIDS model

Location:

Start Date:

End Date:

Program Area: Socio-economic and Policy

Non-commodity: Performance

Objectives:

The present study aims to address the need to recognise fish as a heterogeneous product especially in analysing market structure and policy effectiveness in the fishery sector.

Methodology:

Model and estimation procedure: A multistage budgeting framework was used in this paper to model the fish consumption behaviour of Asian households. The study built on the framework used by Deaton and Muellbauer (1980), Blundell et. al. (1993) and Heien and Wessells (1990) which extended the idea of exhaustive expenditure system to different levels or stages. Specifically, the present model was similar to the approach employed by Dey (2000) and Garcia et. al. (2005) in their earlier fish demand studies for Bangladesh and Philippines, respectively. These two papers were largely instrumental in the development of the current study. The multistage budgeting technique addresses a common problem in empirical estimation of system demand models requiring a sizeable number of equations, given the wide variety of consumption goods jointly purchased by households. Specifically, a full demand system containing all consumer goods warrants a huge number of own- and cross-price parameters that are impractical to estimate under the constraint of limited data. Hence, the solution is to estimate the model in stages, whereby expenditures on goods belonging to broad food categories are incorporated in the model by estimating them sequentially. In this study, a three-stage budgeting framework was adopted to enable the specification of a fish demand system in the final stage that is species-specific, while keeping the number of equations in the demand system manageable. Per capita expenditure functions (for food and subsequently for fish) were specified at the initial two stages of the model. While the quadratic extension of the Deaton and Muellbauer's linear approximate AIDS model (1980), suggested by Banks et al. (1997), hereinafter referred to as the QUAIDS model was formulated at the final stage. Stage 1 of the model assumes that households allocate consumption expenditures to broad groupings such as food and non-food commodities which in turn are affected by income and some demographic characteristics of the household. Sources of data: The data used in this paper were from a study conducted by the WorldFish Center entitled ‘Strategies and Options for Increasing and Sustaining Fisheries and Aquaculture Production to Benefit Poor Households in Asia’ led by the principal author of the paper with funding from the Asian Development Bank. This project was implemented in nine Asian countries, namely: Bangladesh, China, India, Indonesia, Malaysia, Philippines, Sri Lanka, Thailand and Vietnam from 2001–2004. Fish consumption data were obtained mainly from the municipal or national household consumption surveys conducted either by the project or statistical bureaus of partner countries, respectively. Primary surveys were conducted whenever fish consumption by species is not available in the national survey. Since there was wide variation in fish classifications found in the respective country data (each containing 6–11 fish types), some degree of aggregation was employed to facilitate cross-country comparison of species-specific elasticities. Seven broad categories were adopted in the study, which included four types of finfish, two types of non-finfish and one category for processed fish.

Source of Information: Australian Journal of Agricultural and Resource Economics, Volume 52, Issue 3, pages 321–338, September 2008

Article Link (Online Journal): http://onlinelibrary.wiley.com/doi/10.1111/j.1467-8489.2008.00418.x/full

Funding Source:

1.

Budget:

Total Budget (Tk.) :

Achievement/Findings:

Two important results emerged from this analysis. First, fish is clearly a heterogenous product, as shown by the wide variability in the estimated income and price elasticities of different fish types. This result is important for future modelling and analysis of the fisheries sector. Second, the estimated price and income elasticities for all fish types tend to be higher among the poorer sector of the economy compared to the more affluent members of the society. This implies that the poorer households often consider seafood and fishery products as luxury commodities especially the high-value species while the rich simply consider them as basic food items. Hence, partitioning the population by income groups allows a better understanding of fish demand responses that are characteristic of the poor and rich consumers. The analysis showed that as per capita income and population grow in most Asian countries, there will be tremendous increases in fish demand that are expected to come mostly from the poorer sector of the economy. Absence of commensurate increases in fish supply will create pressure for fish prices to go up, which will hurt the consumers. This has worrisome consequences on the protein intake of households, particularly among the poor. However, increasing fish supply, in turn will exert a downward pressure on the price of fish, which is detrimental on the part of the fish farmers. Nevertheless, when fish demand is price elastic, a decline in the price can bring about rising revenues. As highlighted in this study, the consumption of low-value fish species among the poorer households tends to exhibit the kind of demand response that can trigger beneficial effects to both consumers and producers in the face of rising production. In such a case, tilapia, carp, catfish and other low value aquaculture species can continue to play an important role in Asian aquaculture.

Knowledge Management: Journal