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Processor Demand and Price-Markup Functions for Catfish: A Disaggregated Analysis with Implications for the Off-Flavor Problem

Published online by Cambridge University Press:  28 April 2015

Henry Kinnucan ,
Scott Sindelar ,
David Wineholt  and
Upton Hatch
Henry Kinnucan
Affiliation:
Department of Agricultural Economics and Rural Sociology, Auburn University
Scott Sindelar
Affiliation:
Foreign Agricultural Service, USDA
David Wineholt
Affiliation:
Department of Agricultural Economics and Rural Sociology, Auburn University
Upton Hatch
Affiliation:
Department of Agricultural Economics and Rural Sociology, Auburn University
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Abstract

Off-flavor in catfish restricts farm marketings 10 to 45% depending on the season. The economic impact on society of this imposed supply restriction depends, in part, on the elasticity of demand for catfish. Econometric estimates based on disaggregated processing plant data indicate an elastic demand at the processor level but an inelastic demand at the farm level. Short-run social welfare gains from the elimination of off-flavor are estimated to equal 12.0% of farm revenues ($10.0 million in 1983). The inelastic demand for catfish at the farm level, however, means that most of the societal gains will accrue to individuals beyond the farm gate. Thus, an economic justification exists for public sector funding of off-flavor research.

Keywords

applied welfare analysisaquaculturecatfishderived demandoff-flavorprice transmission

Information

Type
Submitted Articles
Information
Journal of Agricultural and Applied Economics , Volume 20 , Issue 2 , December 1988 , pp. 81 - 92
Copyright
Copyright © Southern Agricultural Economics Association 1988

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