English abstract
The industrial structure of fresh fish markets is a major concern to policy makers in Oman. Selling and buying fresh fish is undertaken in several forms, depending on the location of the market, on the type of buyers, and on available marketing facilitating functions. Previous studies have indicated serious impacts of current market organization on the distribution of fresh fish and consequently on the prevalent pricing system leading to high price differences and lack of market integration. The primary area of inquiry in this study relates to market integration as a proxy for spatial pricing efficiency with the objective to understand the links between different fish markets in Oman, to identify unexploited opportunities of arbitrage, and to provide comprehensive information on the interrelationships between these markets. The analysis used 7 markets to test for market integration including the Muttrah, Qurayat, Seeb, Barka, Sohar, Sur, and Ashkarah landing points. Data included daily prices for four common species in these regions for the period 1991 to 1996. Selected species for the analysis include Emperor, Grouper, Kingfish, and Yellow Fin Tuna. The product is assumed to be homogenous and supplied from different fishing areas to consumption centers. The basic approach used in this analysis to test for first order differences is the analysis of price correlation coefficients between pairs of markets, which is then followed by using a model similar to the one developed by Richardson to test if the relationship between pairs of markets is in accord with the Law of One Price. The Law of One Price (LOP) analysis was used to test whether prices in pairs of markets are integrated through transfer costs or not. In Chapter II, the study gives a comprehensive overview of the fisheries sector in Oman with a discussion of the main characteristics of fish markets and with an analysis of the structure of these markets and the pricing system in place. Chapter III reviews the most common analytical approaches to market integration analysis. Quantitative analysis for market integration is carried out in Chapter IV using 3 different approaches, namely the graphical representation of prices over time, the correlation matrix, and the LOP model. Results of the graphical representation revealed that prices are low for all species in Ashkarah and Sur compared to other regions. In addition, the results of the Law of One Price Model (LOP) clearly show that on-shore fresh fish markets in Oman are not integrated. They further indicate that although there are flows of fish from regions of excess supply to markets with excess demand, the marketing system has not been able to establish market linkages through transfer costs. Possible explanations of this lack of market integration may relate to market access and personal links between traders and fishermen at different landing points and to dissaggregation of on-shore markets and their multiplicity. The findings of this study have practical policy implications indicating that the current marketing system for fish in Oman is not supporting a fair distribution of returns from fisheries operations to all participants in the sector. This suggests that further investigation in the area of market development is needed in order to identify the type of arbitrage and optimal fish marketing system.
