Seaweed Farmers in the Philippines Responsiveness to the Price Changes in Relation to Supply and Demand

Abstract

Pricing Theory and Law of Supply and Demand is used to interpret the gathered statistical data from previous studies in this systematic review of economics literature in the Philippines. It provides explanation on the responsiveness of seaweed farmers in the Philippines to the price changes in relation to the supply and demand that is changing from time to time. The strong demand of seaweed drives the market prices, and this may drive seaweed farmers to increase the seaweed production but when the price are low seaweed farmers have the tendency to leave their farms resulting in a low production of seaweed and in effect a decrease in seaweed supply. This problem may be enlightened using the law of supply and demand wherein when the demand is high — the price is high, and the supply is low. On the other hand, if the demand is low — the price is low, and the supply is high. As a result, the seaweed farmers are not responsive to price changes in the short-run and in the long-run.

Keywords: Economic Analysis, Law of Demand, Law of Supply, Literature Review, Philippines, Pricing Theory

JEL Classification: P22, P23, O40, Q21, Y70