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We emphasize the role of seasonality in fruits demand and extend the inverse AIDS model to incorporate seasonality and product availability into the demand. Estimation results show that own flexibilities are different across seasons, and the degree of q-substitutability between domestic and imported fruits is varying dependent upon seasons, as well. In the demand for most fruits, own price flexibilities are relatively smaller at in-season rather than at out-of-season. Imported oranges are found to compete with pears, watermelons and Korean melons in spring, and peaches in summer, while bananas being imported into the domestic market all the year round are mostly competing with apples in both summer and fall, Korean melons and grapes in fall, and pears in winter. Parameter estimates on substitutions between domestic and imported fruits might be useful to design a marketing strategy for domestic fruits and/or public support programs for those producers. |
