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An Inverse Almost Ideal Demand System of Fresh Tomatoes in the U.S

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  • Grant, Jason H.
  • Foster, Kenneth A.

Abstract

Previous studies of fresh market tomatoes in the U.S. have focused on the supply side and welfare effects of NAFTA. Very few studies have focused on the demand side, however, because fresh tomatoes do not have any close substitutes. In this study we draw on the fact that Mexican and Canadian fresh tomatoes may be close substitutes to U.S. fresh tomatoes. An Inverse Almost Ideal Demand System of the NAFTA fresh tomato market is estimated where fresh tomatoes differ by country of origin. The results indicate that NAFTA tomatoes are substitutable but the degree of substitutability varies widely depending on the season. Quantity changes in the U.S. fresh tomato market can result in significant retail price changes. This study has specific policy implications in light of the recent dumping conflicts between NAFTA members over fresh tomato trade.

Suggested Citation

  • 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).
  • Handle: RePEc:ags:aaea05:19193
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    File URL: http://purl.umn.edu/19193
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    References listed on IDEAS

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    1. 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(03), December.
    2. Moschini, GianCarlo & Vissa, A., 1992. "Linear Inverse Demand System, A," Staff General Research Papers Archive 11250, Iowa State University, Department of Economics.
    3. 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.
    4. Deaton, Angus S & Muellbauer, John, 1980. "An Almost Ideal Demand System," American Economic Review, American Economic Association, vol. 70(3), pages 312-326, June.
    5. Deaton,Angus & Muellbauer,John, 1980. "Economics and Consumer Behavior," Cambridge Books, Cambridge University Press, number 9780521296762, May.
    6. Schroeter, Christiane & Foster, Kenneth A., 2004. "The Impact Of Health Information And Demographic Changes On Aggregate Meat Demand," 2004 Annual meeting, August 1-4, Denver, CO 20130, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
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    Cited by:

    1. Jung, Jione, 2009. "Effects Of The Suspension Agreement: U.S.-Mexico Fresh Tomatoes Antidumping Case," 2009 Annual Meeting, July 26-28, 2009, Milwaukee, Wisconsin 49285, Agricultural and Applied Economics Association.

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    Keywords

    Demand and Price Analysis;

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