An economic analysis of the marketing order for lemons and its impact on the domestic consumer, 1954-1975

Published in 1977

The objective of this study was to examine the impact of the Lemon Marketing Order on the domestic consumer. The major criticism of the Order has been that of "undue price enhancement" by means of the rate of flow provision. Analyses of prices indicated the real retail price of fresh lemons has increased an average of 1.2 percent annually from 1954 through 1974. The data also indicated that although the on-tree price has shown a slightly higher annual percentage increase, the absolute differential between the price levels is increasing. About 68 percent of the retail price increase can be attributed to the marketing margins. The shipment of fresh lemons into the domestic market has declined, especially for summer lemons. Per capita consumption of and expenditures on fresh lemons have declined. The estimated retail price elasticities were elastic for summer lemons and near unity for winter lemons. Both seasons’ on-tree elasticities were -inelastic. The significance of the estimated elasticities suggest that the Lemon Administrative Committee, making one set of decisions cannot simultaneously satisfy the domestic consumer and the grower.

AZU_TD_BOX116_E9791_1977_252.pdf (3.64 MB)

Author(s)

Publication Date