Price and Quality Relationships in Pistachio Market in Kerman

Subject Areas : Agricultural Economics Research

M. Abdollahi Ezatabadi ¹

1 - عضو هئیت علمی موسسه تحقیقات پسته کشور

Received: 2015-12-18 Accepted : 2015-12-18 Published : 2011-09-23

Keywords: quality, price, Pistachio market, Hedonic pricing,

Abstract :

Pistachio is a product with wide range of quality. Therefore, it is necessary to investigate the relationship between price and quality. In this study, using a sample of 110 farmers and 119 pistachio traders, the relation between pistachio quality and pricing was investigated in Kerman province. Data were collected from a sample of 110 farmers and 119 traders using stratified random sampling method. Hedonic pricing method was used for estimating price model. Also, to measure the effects of socio economic factors on difference between simulated and real selling prices, Pearson correlation and variance analysis methods were used. The results showed that splitted oohadi variety with 30-32 pieces per ounce was the best choice as basic sample for pistachio pricing. Also, Hedonic model showed that among 12 quality factors, only two (percent of splitting and ounce) were significant. Insignificant factors could be divided into three groups. The first group was measurable with high costs. The second was easily measurable but not perfectly recognized by the market. The third group could be measured visually. The results of study showed that selling price received by pistachio producers was relatively low due to weak relationship between price and quality.  

References:

1. Abdolahi-Ezzatabadi, M. 2008. Investigation of the role ofaflatoxin in the istability of pistachio market in Iran. Final Reportof Project. Iran's Pistachio Research Institute. 2-014-150000-04-0000-85027.

2. Abdolahi-Ezzatabadi, M. and Najafi, B. 2007. An assessment ofthe possibility of farmers and traders participation in the futuresand options markets in Iran: A case study of pistachio.Agricultural Economics and Development. 57: 105-130.

3. Abdolahi-Ezzatabadi, M. Noori, K., Rahimi, H., Mansoorian, N.and Salem, J. 2009. Investigation of the market power structure inthe pistachio domestic market in Iran and its effect on differentgroups (especially producers). Final Report of Project. Iran'sPistachio Research Institute. 3-100-150300-00-0000-85056.

4. Brorsen, B. W., Grant, W. R. and Rister M. E. 1988. Some effectsof rice quality on rough rice prices. Southern Journal ofAgricultural Economics. July: 131- 140.

5. Faulds, D. J. and Lonial S. C. 2001. Price-quality of nondurableconsumer products: a European and United States perspective.Journal of Economic and Social Research. 3: 59-76.

6. Hazarika, C. 2005. Principles and methods of pricing agriculturaland allied products.

http://assamagribusiness.nic.in/agriclinics/Principles%20&%20methods.pdf.

7. Iran's Agricultural Comodity Exchange. Daily Reports.

8. Jung, S. 2007. Price-quality incentives in U.S. cotton. A Ph.D.Dissertation in Agricultural and Applied Economics, GraduateFaculty of Texas Tech University, U.S.A, 112 pages.

9. Mehrabi Boshrabadi, H. 2002. Review of factors influencingIran's share in the world pistachio market. AgriculturalEconomics and Development. 39: 85-102.

10. Murphy, R. D. 2002. Price and quality relationships in localservice industries. http://www.ftc.gov/be/workpapers/wp249.pdf.

11. Tronstad, R., Huthoefer, L. S. and Monke, E. 1992. Marketwindows and hedonic price analyses: an application to the appleindustry. Journal of Agricultural and Resource Economics, 17:314- 322.