Can Direct Marketing Increase Fishery Profitability and Environmental Quality? Empirical Evidence of Aquaculture Farm Households in Taiwan

Abstract

Marketing strategies play a significant role in determining farm income. Although direct marketing has been proposed as an innovative way to improve producers’ economic welfare, little is known about producers’ adoption of direct marketing among aquaculture farms. This study examines the adoption of wholesaler markets, individual wholesalers or shippers, and direct marketing among aquaculture farms. In addition, we quantify the effects of the use of different marketing channels on fishery revenues, profits, and production inputs. A sample of 25,180 aquaculture family farms in Taiwan was drawn from the fishery census survey. After estimating the simultaneous equation system model, we find that the use of multiple marketing channels generates the highest fishery revenues, which highlights the importance of marketing channel diversity on selling fishery products. Moreover, we find a positive effect of direct marketing on fishery revenues and profits. We also find that the use of direct marketing can reduce the use of groundwater in aquaculture production. Since the decrease in groundwater use can mitigate the severity of land subsidence, this paper provides evidence that direct marketing can possibly provide a win-win strategy to improve fishery producers’ revenues and environmental quality.