Market structure analysis of Iranian apple export market with Pricing to Market (PTM) Approach

Document Type : Research Paper

Authors

1 Masters of Agricultural Economics, Agriculture, Tarbiat Modares University, Tehran,Iran

2 TARBIAT MODARES UNIVERSITY / FACULTY MEMBER

3 tarbiat modares university faculty member

Abstract

Apple is considered one of the most important Iranian products, which has a high position in both job and value creation. In this study, empirical analysis of major Iranian apple export markets was conducted using the pricing to market (PTM) under two kind of exchange rate such as nominal exchange rate and real exchange rate. In this regard, the annual data from 1993 to 2015 were used. The econometric analysis using the panel corrected standard errors (PCSE) showed that PTM behavior is influenced by the exchange rate effects and The impact of country specific effects on the behavior of Apple exporters is not observed. The PTM behavior was better predicted with the real exchange rate. The analysis of the asymmetric effects of the exchange rate also showed that these effects are asymmetric in exports to the Netherlands. Given the negative sign of the coefficient of estimating the asymmetric effects model, it can be concluded that the effect of the depreciation of the rial on the transfer of exchange rate fluctuations to the Dutch apples markets is greater than its increase. Therefore, it is suggested that economic experts identify different market elasticity marks, to determine the type of market. In countries where the market is a competitive and elastic product, it is necessary to identify the behavior of other competitors and reduce export prices to compete with other countries where export Apple.

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References

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Agricultural Economics
Volume 12, Issue 3 - Serial Number 3
December 2018
Pages 27-45

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