Scandinavian Working Papers in Economics
UiS Working Papers in Economics and Finance,
University of Stavanger
No 2009/23: The structure of herring product demand in Russia
Kristin Lien (), Ragnar Tveterås () and Sigbjørn Tveterås
Additional contact information
Kristin Lien: Norwegian Seafood Export Council
Ragnar Tveterås: University of Stavanger, Postal: University of Stavanger, NO-4036 Stavanger, Norway
Sigbjørn Tveterås: University of Stavanger, Postal: University of Stavanger, NO-4036 Stavanger, Norway
Abstract: Russia is experiencing deep structural changes in many areas. For the seafood industry important developments are large increases in household incomes, development of modern super- and hypermarket distribution channels, and product innovations. In the seafood category consumers are adopting new species and new product forms at a rapid rate. Herring is one of the species that is experiencing these changes. The dominant product form has traditionally been whole salted herring, typically sold at open markets. Herring sold in the traditional unprocessed form has been a protein source for poor people, consumed at home. But more processed and expensive product forms that are distributed through modern distribution channels have increased their market share during the data period.
We employ a panel data set on monthly per capita demand for different herring products in six Russian regions, from unprocessed to value added products, to test hypotheses on the structure of herring consumption. We estimate dynamic panel data demand systems, with region-specific estimates of price and income elasticities. The six regions in the data set have large differences in average per capita income. Our econometric estimates indicate significant structural regional differences in per capita consumption of different products, also after controlling for income differences. We find that whole herring is generally an inferior good, whereas fillet herring products tend to be normal goods. This suggests that if incomes continue to increase, consumption will shift further from unprocessed to value added herring products.
JEL-codes: M20
25 pages, April 28, 2009
Full text files
uis_wps_2009_23_lien_tveteraas_tveteraas.pdf
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