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Perish or prosper: Trade patterns for highly perishable products

Frank Asche (), Hans-Martin Straume () and Erling Vårdal ()
Additional contact information
Hans-Martin Straume: Department of Economics, BI Norwegian Business School, https://www.bi.edu/about-bi/employees/department-of-economics/hans-martin-straume/?_ga=2.25904382.2107270820.1541076662-826569161.1541076662

No 4/18, Working Papers in Economics from University of Bergen, Department of Economics

Abstract: In recent years trade with highly perishable agricultural products like fresh fish, berries and cut flowers has increased substantially. The perishability of these products appears to challenge conventional wisdom when it comes to food trade, which emphasizes the importance of large shipments to reduce transportation costs. In this paper, gravity models and several margins of trade are estimated for the trade with fresh salmon, a highly perishable product. The results indicate that increased geographical distance have a larger negative effect than what is generally reported in the literature. Most interestingly, the number of exporters and the shipment frequency increase while there is little impact on shipment size when trade increase. Hence, freshness and possibly avoidance of losses by not selling products by the expiration date seem to be emphasized rather than economies of scale in transportation.

Keywords: gravity model; transaction level data; margins of trade; perishable products (search for similar items in EconPapers)
JEL-codes: F14 Q22 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-agr and nep-int
Date: 2018-04-23
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Working Paper: Perish or prosper: Trade patterns for highly perishable products (2017) Downloads
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