Price elasticity of the demand for brassicas in the Região Serrana of Rio de Janeiro

Abstract

Broccoli, cauliflower and cabbage are the most marketed vegetables in the brassica family. Their relevance is associated both with food security and its underlying economic and social dynamism, since their production is predominantly carried out by family farmers. The objective of this work was to provide a study of the market and price elasticity of demand for selected brassicas, produced in the Região Serrana of Rio de Janeiro, from 2017 to 2022. Analyses were made for the real prices and quantities sold in the region, as well as estimates of price elasticities of demand for cabbage and cauliflower, using the log-log model estimated by ordinary least squares (OLS). The results showed that broccoli and cauliflower producers faced significant drops in their total revenues of 87% and 28%, respectively. However, the cabbage producers saw 24% increase in its total revenue. The estimation of the demand for cabbage showed that it is inelastic and that there is a substitution relationship with broccoli, while the demand for cauliflower depends only on its own price and has unitary elasticity. The study is very timely as it shows the dynamics of the brassica market in the producing region and the consequences for the markets which it supplies, which can help with the formulation of public policies.