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村上, 宏之

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Murakami, Hiroyuki

4182

EU 会計指令における連結財務諸表の作成規定(藤井  泰教授記念号)

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4185

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Petro-Ecology in Upton Sinclair’s Oil ! : An Illusion of Pastoralism

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櫻井, 啓一郎

2624

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Sakurai, Keiichiro

2625

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今村, 暢好

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イマムラ, ノブヨシ

Imamura, Nobuyoshi

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川東, 竫弘

カワヒガシ, ヤスヒロ

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President Kiyoshi Mashioka and The History of Matsuyama University of Commerce

井草, 剛

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4021

松 山 大 学 論 集
第 30 巻 第 6 号 抜 刷
2019 年 2 月 発 行
Marketing Considerations
in the Japanese Flower Market
Go Igusa
Katsushi Mizuno
Yukie Morita
Marketing Considerations
in the Japanese Flower Market
Go Igusa
Katsushi Mizuno
Yukie Morita
1．Introduction
1‐1. Purpose and Objective
This paper focuses on market conditions in Japan’s flower market. The
primary subject of this paper is how Japanese consumer behavior affects the flower
market and how this, in turn, affects marketing approaches. We wanted to find out
whether Japanese people behave rationally in the face of flower prices. If they do,
we would advise stimulating the market with an economic-based policy. However,
if they do not, a policy based on economic theory will not achieve the desired
effect. We will analyze the flower market from the standpoint of rational behavior.
When we classified Japanese potted flowers into luxury varieties and
popular varieties, we created the following typology : tropical orchid, cyclamen,
chrysanthemum, primrose, begonia, and dendrobium.
The second objective of this study was to analyze whether consumption of the
luxury varieties and popular varieties follow rational behavior that maximizes utility.
As an original methodology used in this paper, we take the standard deviations
between the actual and optimal values of growth in consumption of these potted
plants and compare them to see if these deviations show whether consumers are
behaving rationally.
In synthesizing these results, the third objective was to discuss an appropriate
structure for the flower market in the future. If, regarding the second objective, we
find that rational behavior is not being followed to maximize utility ; we will
investigate what needs to be done to achieve maximum utility.
The methodology herein will use an original model that we developed and
revised to analyze the current flower market. The methodology is based on the
system-wide approach of Theil（1980b）. Its originality lies in our incorporation of
the above-mentioned index.
1‐2. Literature Review
The system-wide approach was explained thoroughly by econometrician H.
Theil（1980a and1980b）. In this study, we formulate a demand equation. The
demand for each consumer good is expressed in an equation consisting of differential
small-declension variables. The merit of that theory is that it is not necessary to
assume the one-order homogeneous function. In other words, we can do a more
realistic analysis. However, merely introducing this theory and a simple example is
inadequate for analyzing the actual flower market.
Kaneko（2009）is a pioneering analyst of Japan’s flower market. We divide
people into those who purchase flowers and those who do not. Those who
purchase flowers take many factors into consideration, including the store, the price,
appearance, the variety of flowers, and the flower’s usefulness. In other words,
consumer behavior is not rational from the standpoint of economics, as it can be
swayed by factors that have nothing to do with price. Consumers may opt not to
buy any flowers, notwithstanding the price. This paper investigates whether
consumers behave rationally when purchasing potted flowers.
Knaneko, Wong L, Selvanathan E. A., and Selvanathan S.,（2015）study
56 松山大学論集 第30巻 第6号
consumers’ rational behavior based on a system-wide approach. The system-wide
approach they use analyzes the meat market in Australia on the premise that meat is
consumed under conditions of rational behavior. However, an analysis such as this
one, which compares rational and irrational behavior, has not been conducted
previously.
2．Methods
2‐1. The Herfindahl-Hirschman Index
The Herfindahl-Hirschman index is a measure of market concentration. The
index can show whether a market has become concentrated around certain brands to
the point of becoming an oligopoly. Expressing this as H , we get the following
equation :






 －（1）
α1, α2, α3・・・denote market shares. The larger the value, the greater the market
concentration. Conversely, the smaller the value, the more competitive the market.
In Japan, flower varieties have had different uses, but these uses have recently
become more diverse. We can use the Herfindahl-Hirschman index to analyze
Japanese flower brands to find out whether the market is concentrated around certain
brands. In other words, we can measure the degree of concentration in the
Japanese flower market.
Here, in the flower market, H means the following : Although the use of
different flower varieties has been determined in Japan, these rules have broken
down somewhat in recent years. Tropical orchids were used for celebrations, but
now they are also purchased for funerals, hobbies, and display. Investigating the
size of H in Japan enables us to find out whether Japan’s flower market is biased
and gives us the opportunity to consider how the market for tropical orchids and
Marketing Considerations in the Japanese Flower Market 57
0.6
0.5
0.4
0.3
0.2
0.1
0
1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005
Figure 1. Herfindahl’s H
other flowering plants should be ordered.
In this paper, let us first calculate this index for potted plants in Japan’s flower
market. The index is the sum of the squares of the market share for each brand.
Figure1shows the values for Herfindahl’s H for the six above-mentioned varieties.
The greater the differential in the brand strength of a flower and the greater the
concentration in the more popular flowers, the greater is the value of H .
Conversely, the more diffuse a flower’s popularity and the less concentrated, the
lower the value of H .
The value of H , which was0．42 in1992, rose to0．55by2005. This means
that the market became more oligopolistic. Let’s examine this.
3．Model Analysis : Results
3‐1. Analysis Using a System-Wide Approach
We apply the system-wide approach of Theil（1980a and1980b）. The demand
equation for this theory can be expressed in the following relative price equations for
the differential demand equation（2）:
58 松山大学論集 第30巻 第6号

	
	


	
	

~~~~

	
	


	
	

~~~~
……

	
	


	
	

~~~~ －（2）
Where :
: tropical orchid volume, : cyclamen volume, : chrysanthemum volume,
: primrose volume, : begonia volume, : dendrobium volume, 	: tropical
orchid price, 	: cyclamen price, 	: chrysanthemum price, 	: primrose price,
	: begonia price, 	: dendrobium price
In equation⑵, 	
		is the Frish price index, dlnQ
is the Divisia quantity index, and . Also, φ is
income elasticity. Here （ I＝1,2,3, … ）stands for the share of the total
budget（i. e., each good’s share of the budget）, and （I＝1,2,3,… j＝1,2,3,
…）stands for the marginal share（i. e., the rate of increase in each good’s share
when the budget increases）. Each of these must add up to1, as follows :
 －（3）
 －（4）
The actual estimation is done according to the following absolute price
equation. This is the same value as in the relative price equation :1）
Marketing Considerations in the Japanese Flower Market 59
	
	





	

	

……………
	
	
 －（5）
Here, we take the parameter restrictions of the Slutsky symmetry into
consideration. Based on these restrictions, we estimate equation（5） using a
limited three-stage least-squares method. The price corresponding to the sixth good,
dendrobium, is subtracted from the second price variable, and there is no estimate
for a sixth equation. This is because the parameters for the sixth equation are
solved by the parameter restrictions.2）
Example
 		 
 	
	 
……………
 		 
 		 
－（5）′
The estimation results for equation（5）are as follows : The estimation period
was1992－2006.3）
60 松山大学論集 第30巻 第6号
Divisia
quantity
index 
Tropical
orchid
price
Cyclamen
price
Chrysanthe
-mum
price
Primrose
price
Begonia
price
Coefficient
of
determination
Tropical orchid 0．7789 －0．1026 0．0508 0．0141 0．0084 －0．0123 0．9893
Cyclamen 0．0789 0．0508 －0．0796 0．0130 0．0103 －0．0108 0．8016
Chrysanthemum 0．0142 0．0141 －0．0228 －0．0022 －0．0022 0．0102 0．6288
Primrose 0．0374 0．0084 0．0103 －0．0022 －0．0076 0．0064 0．5404
Begonia 0．0164 －0．0123 －0．0108 0．0102 0．0064 －0．0058 0．1939
Table1. Estimation values of and 
Divisia
quantity
index
Tropical
orchid
price
Cyclamen
price
Chrysanthe
-mum
price
Primrose
price
Begonia
price
Tropical orchid 0．0210 －0．1026 0．0107 0．0070 0．0082 0．0073
Cyclamen 0．0171 0．0107 0．0107 0．0055 0．0065 0．0053
Chrysanthemum 0．0105 0．0070 0．0047 0．0047 0．0044 0．0042
Primrose 0．0113 0．0082 0．0065 0．0044 0．0067 0．0045
Begonia 0．0164 －0．0123 0．0053 0．0042 0．0045 0．0055
Table2. Standard error
Divisia
quantity
index
Tropical
orchid
price
Cyclamen
price
Chrysanthe
-mum
price
Primrose
price
Begonia
price
Dendrobium
price
Dendrobium 0．0742 0．0416 0．0163 0．0029 －0．0154 0．0124 0．0164
Table3. Dendrobium
The dendrobium figures are calculated as follows, using equation（4）and the
restrictions in footnote2:
Therefore, the marginal share, which is the first parameter on the right in
equation（5）, is as follows :
＝0．7789 ＝0．0789 ＝0．0142 ＝0．0374 ＝0．0164
＝0．0742
Marketing Considerations in the Japanese Flower Market 61
Tropical
orchid Cyclamen
Chrysanthe
-mum Primrose Begonia Dendrobium
Tropical orchid 0．8118 －0．0402 －0．0172 0．0123 0．0374 －0．0252
Cyclamen －0．0402 0．1654 －0．0249 －0．0177 0．0228 －0．0265
Chrysanthemum －0．0172 －0．0249 0．0046 0．0049 －0．0202 0．0670
Primrose 0．0123 －0．0177 0．0049 0．0165 －0．0122 0．0336
Begonia 0．0374 0．0228 －0．0202 －0．0122 0．0118 －0．0232
Dendrobium －0．0252 －0．0265 0．067 0．0336 －0．0232 0．0485
Table4. 
Tropical orchid 1．1432
Cyclamen 0．4325
Chrysanthemum 0．7203
Primrose 1．0819
Begonia 0．5276
Dendrobium 1．4592
Table5. Flower income elasticity
Calculating the respective parameters and setting φ（i. e., the above parameter
restriction and income elasticity）at －0．5gives the following :4）
3‐2. Flower Income Elasticity
To find out which flowers are luxury varieties and which are popular varieties,
we calculate their respective income elasticities. θi／wi corresponds to income
elasticity.5）Table5shows the income elasticity for each flower variety :
An income elasticity of more than1 indicates a luxury variety, and an income
elasticity of less than 1 indicates a necessity. In this study, we also regard a
number higher than1 as indicating a luxury variety, and a number lower than1 as
62 松山大学論集 第30巻 第6号
Tropical
orchid Cyclamen
Chrysanthe
-mum Primrose Begonia Dendrobium
1992 0．6061 0．2195 0．0266 0．0407 0．0465 0．0606
2006 0．7293 0．1653 0．0144 0．0272 0．0231 0．0407
Change 0．1232 －0．0542 －0．0122 －0．0135 －0．0234 －0．0199
Table6. Change in market share
indicating a popular variety. Thus, the tropical orchid and dendrobium are luxury
varieties, while the cyclamen, chrysanthemum, and begonia are popular varieties.
The primrose is somewhere between these groups.
Now, let’s look at the change in share of these flowers. We will not look at
time series data but at the average value of market share wi to enable comparisons
among flowers.
Although the market share of tropical orchids has increased in monetary terms
in terms of the number of plants from1994 to2004, annual production of tropical
orchids exceeded20million. It then began declining, dropping to16 million by
2015. Tropical orchids did not substantially change, but continued to be regarded
as a luxury variety. Meanwhile, cyclamen production, which was15million in the
early1990s, has remained stable at20million since2000.
3‐3. The Presence or Absence of Rational Economic Behavior
We will now calculate the deviation between the actual values and optimal
values of marginal shares. To do this, we calculated the number that corresponds
to the actual marginal shares. Theil（1980b, p.49）demonstrate how to calculate θi
with respect to wi, as follows :
Marketing Considerations in the Japanese Flower Market 63
a b
Tropical orchid －0．4511 0．0454
Cyclamen 1．1362 －0．0383
Chrysanthemum －0．0095 0．0011
Primrose －0．1689 0．0082
Begonia 0．5776 －0．0219
Dendrobium －0．0814 0．0053
Table7. Estimation value for parameters a and b in
equation（6）
Estimation period : 1992‐2006
Tropical orchid Cyclamen Chrysanthemum Primrose Begonia Dendrobium
0．0685 0．8193 0．3387 0．1665 0．3903 0．2458
Table8. Deviation between the actual and optimal marginal share
  －（6）
 	  －（7）
Y : Total value of flower shipments（i. e., total consumption value）.
We can calculate θi with respect to wi for each year. These can be considered
actual marginal shares. ai and bi are parameter values when the six flower types are
measured with the above equations. We estimated the above equations using the
ordinary least-squares method.
Using these, we calculated the marginal share of each with the following
equation : we calculated the deviation from the marginal share when utility is
maximized（as with the marginal share found previously）. The averages of their
absolute values are listed in the table below :
64 松山大学論集 第30巻 第6号
Tropical orchid and dendrobium, which we determined to be luxury varieties
because of their income elasticity values, had low deviation values, while the
popular varieties of cyclamen, chrysanthemum, and begonia had high deviation
values. We found that consumers behaved rationally toward the luxury varieties,
but behaved irrationally toward the popular varieties. We propose that rational
behavior be adopted for popular varieties as well, so that producers can stabilize
their operations and market activity can be stimulated further. In other words, as
Kaneko（2009）concludes, we extrapolate that consumers are not influenced by the
price of the latter, so they do not behave rationally, but make their purchasing
decisions based on appearance and other preferences. Our paper could point to the
need of marketers to elicit as much rationality as possible from consumers with
respect to the popular varieties of flowers.
4．Discussion and Conclusion
This paper divided flowers into two types and found that consumer behavior
toward each type differs.
These were the luxury varieties of tropical orchid and dendrobium and the
popular varieties of cyclamen, chrysanthemum, and begonia.
In addition, with respect to the two types of consumer behavior, the reasons for
buying the luxury varieties of tropical orchid and dendrobium were very clear, and
consumers behave rationally when buying them. In contrast, for the popular
varieties of cyclamen, chrysanthemum, and begonia, consumers did not behave
rationally, but chose the plants based on their appearance, variety, and usefulness.
One of the outcomes of this paper is that in identifying the two types（with
cyclamen, chrysanthemum, and begonia being the popular types）, we could prove
that this behavior corresponded with the theory set forth in Kaneko（2009）.
To stabilize product supply, consumers need to behave rationally in economic
Marketing Considerations in the Japanese Flower Market 65
terms with respect to the popular varieties. Creating a market that conforms with
economic theory will allow for an efficient supply and demand system to take hold.
One way to do this is to promote consumption behavior influenced by prices,
advertising, appearance, variety, and usefulness.
The problem we face is the limited data we have. The government stopped
publishing its statistical survey of the flower business in 2006. Therefore, our
analysis could be performed only for data up to 2006. A new picture of data
estimates by variety will need to be drawn using market statistics and other sources.
Appendix : Data
Tropical orchid price
Statistical survey report on the flower business
Government statistics on potted plants（per plant, in yen）
Tropical orchid shipment volume
Annual statistics on crop acreage and shipments by item（1976‐）
Ministry of Internal Affairs and Communications Statistics Bureau for data on potted plant
shipments.
Capital : Statistics on floral product shipments
Area under cultivation（a）
Cost of capital : Bank of Japan Research and Statistics Dept.
Interest rate（yield on newly issued10‐year Japanese government bonds）
Labor force : Statistics on floral product shipments
Number of farms that produce each flower variety
Wages
Income per farm（total shipments divided by number of farms）
66 松山大学論集 第30巻 第6号
Footnotes
1）See Theil（1980b）pp.29－33.
2）The Slutsky Coefficient is found with the following equations.


3）The data only go up to2006 because that was the year of the last statistical report on the
flower business. There are no data of the flower business after2007in Japan.
4）Theil’s analysis uses －0．5as income elasticity. See Mizuno（1998）p.151.
5）See Theil（1980b）p.18.
6）The statistical values are as follows.
t value
of constants
t value
of coefficients
Coefficients
of determination
Tropical orchid －0．1439 0．361196 0．0099
Cyclamen 0．713981 －0．59937 0．0268
Chrysanthemum －0．02068 0．063648 0．0003
Primrose －0．45793 0．551721 0．0228
Begonia 0．811454 －0．76778 0．0433
Dendrobium －0．15093 0．245168 0．0046
References
Kaneko, N.（2009）“One consideration of ”cut-flowers” consumption and consumer needs”, The
Journal of Matsumoto University, Vol.7,33－47.
Mizuno, K., Doi, T., Ando, S., Omata, J., and Igusa, G.（2016）“Relation between total factor
productivity and utility”, Journal of Human Resource and Sustainability Studies, Vol.4, No.2,
130－142.
Mizuno, K.（1986）“A study about technological progress”. Kitakyuusyu University shogakuronshu ,
Vol.21, No.1, pp.65－90.
Mizuno, K.（1991）Divisia Index. Tokyo, Souseisya,236p.
Mizuno, K.（1992）A Study about System-Wide Approach. Tokyo，Azusashuppan,229p.
Mizuno, K.（1998）Theory and Activity of Economic Index. Tokyo, Souseisya,203p.
Theil, H.（1980a）The System Wide Approach to Microeconomics, University of Chicago Press,
Chicago,260p.
Theil, H.（1980b）System-wide explorations in international economics, input-output analysis, and
marketing research, North-Holland Publishing Company, Amsterdam, Vol.2,143p.
Wong L, Selvanathan E A and Selvanathan S（2015）Modeling the Meat Consumption Patterns in
Australia, Economic Modeling , Vol.49, No. C, pp.1－10.
Marketing Considerations in the Japanese Flower Market 67


Marketing Considerations in the Japanese Flower Market

作田, 良三

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サクダ, リョウゾウ

Sakuda, Ryozo

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EU 会計指令における連結財務諸表の作成規定(藤井泰教授記念号)