Measuring Price–Quantity Relationships in the Dutch Flower Market
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This research applies an inverse, almost ideal demand model with seasonal adjustments to
estimate price–quantity relationships among major cut flower species traded at the Dutch
flower auctions. Trigonometric functions are used as a flexible and efficient alternative to
standard seasonal dummies. The estimated price and scale flexibilities were all found to be
statistically significant with signs as expected. The demand for all flower groups is inflexible,
and most of them are quantity substitutes. Based on the estimated values for price and scale
flexibilities, a potential for market timing seems to exist, i.e., flower producers may use easily
available calendar information to predict prices and quantities.