Philippine Journal of Science
150 (4): 657-668, August 2021
ISSN 0031 – 7683
Date Received: 09 Dec 2020

Demand Elasticities of Canned Tuna at Point
of Sale of a Large Retail Chain in Southern
Philippines: Implications for Sustainability Policy

Miko Mariz C. Castro*, Jon Marx P. Sarmiento, and Larry N. Digal

School of Management
University of the Philippines Mindanao, Davao City 8000 Philippines

*Corresponding author: mccastro9@up.edu.ph

ABSTRACT

New variants of canned skipjack tuna have been developed by large manufacturers of canned tuna in the Philippines. This study analyzes the expenditure and price elasticities of canned tuna and determines the implications for sustainable fishery. An AIDS (almost ideal demand system) model incorporating an income group variable was used to estimate these elasticities. This study utilized a pooled time series data of 459 weekly point-of-sale observations from 2010–2012 of three store branches of a large supermarket chain in southern Philippines. The point-of-sale data suggest that canned tuna consumption is composed mostly of tuna in sauce with vegetables followed by tuna in oil and tuna in sauce without vegetables. For both high- and low-income groups, the expenditure elasticities have the expected positive signs – indicating that as the income of consumers’ increases, the quantity demanded for canned tuna in three product mediums also increases. For high-income consumers, consumption of tuna in sauce with and without vegetables is more responsive to income changes. The own-price elasticities of the three product mediums across high- and low-income store branches have negative signs – suggesting that as their own price increases, the quantity demanded for these products decreases. The cross-price elasticities suggest that tuna in sauce with vegetables is a substitute for tuna in oil and in sauce without vegetables for both income groups. Thus, promoting more use of vegetables through product development may lead to a lower volume of tuna meat used in canned tuna products, which contributes to addressing tuna resource sustainability