IDEAS home Printed from https://ideas.repec.org/p/ags/aaea06/21310.html
   My bibliography  Save this paper

How to Promote Quality Perception in Wine Markets: Brand Advertising or Geographic Indication?

Author

Listed:
  • Yue, Chengyan
  • Marette, Stephan
  • Beghin, John C.

Abstract

In the context of the wine industry, we investigate producers' choice between geographic indications and brand advertising to convey information to consumers. Producers also decide whether or not to select an effort level for improving the quality of their products. We show that if this effort is selected, a producer will prefer to rely on brand advertising for promoting its products and set up its own reputation. Despite the sharing of the promotion cost, a geographic indication does not sufficiently reward the effort for improving quality. Finally, the selection of both instruments by producers is examined.

Suggested Citation

  • Yue, Chengyan & Marette, Stephan & Beghin, John C., 2006. "How to Promote Quality Perception in Wine Markets: Brand Advertising or Geographic Indication?," 2006 Annual meeting, July 23-26, Long Beach, CA 21310, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
    • Handle: RePEc:ags:aaea06:21310
    DOI: 10.22004/ag.econ.21310
    as

    Download full text from publisher

    File URL: https://ageconsearch.umn.edu/record/21310/files/sp06yu01.pdf
    Download Restriction: no
    File URL: https://libkey.io/10.22004/ag.econ.21310?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    Other versions of this item:

    References listed on IDEAS

    as
    1. Marette, Stephan & Crespi, John M & Schiavina, Allesandra, 1999. "The Role of Common Labelling in a Context of Asymmetric Information," European Review of Agricultural Economics, Oxford University Press and the European Agricultural and Applied Economics Publications Foundation, vol. 26(2), pages 167-178, June.
    2. Philippe Mahenc, 2004. "Influence of Informed Buyers in Markets Susceptible to the Lemons Problem," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 86(3), pages 649-659.
    3. Jason A. Winfree & Jill J. McCluskey, 2005. "Collective Reputation and Quality," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 87(1), pages 206-213.
    4. Fluet, Claude & Garella, Paolo G., 2002. "Advertising and prices as signals of quality in a regime of price rivalry," International Journal of Industrial Organization, Elsevier, vol. 20(7), pages 907-930, September.
    5. Marette, Stephan & Zago, Angelo M., 2003. "Advertising, Collective Action, And Labeling In The European Wine Markets," Journal of Food Distribution Research, Food Distribution Research Society, vol. 34(3), pages 1-10, November.
    6. Stéphan Marette & John Crespi, 2003. "Can Quality Certification Lead to Stable Cartels?," Review of Industrial Organization, Springer;The Industrial Organization Society, vol. 23(1), pages 43-64, August.
    7. Marco Costanigro & Jill J. McCluskey & Ron C. Mittelhammer, 2007. "Segmenting the Wine Market Based on Price: Hedonic Regression when Different Prices mean Different Products," Journal of Agricultural Economics, Wiley Blackwell, vol. 58(3), pages 454-466, September.
    8. Bodo Steiner, 2004. "French Wines on the Decline? Econometric Evidence from Britain," Journal of Agricultural Economics, Wiley Blackwell, vol. 55(2), pages 267-288, July.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. M’hand Fares & Saqlain Raza & Alban Thomas, 2018. "Is There Complementarity Between Certified Labels and Brands? Evidence from Small French Cooperatives," Review of Industrial Organization, Springer;The Industrial Organization Society, vol. 53(2), pages 367-395, September.
    2. YOO, Veronica & FLORKOWSKI, Wojciech J. & CAREW, Richard, 2015. "Pricing Attributes Of Wines From Emerging Suppliers On The British Columbia Market," Review of Agricultural and Applied Economics (RAAE), Faculty of Economics and Management, Slovak Agricultural University in Nitra, vol. 18(2), pages 1-12, October.
    3. Fares, M’hand & Raza, Saqlain & Thomas, Alban, 2018. "Is there complementarity between labels and brands? Evidence from small French co-operatives," TSE Working Papers 18-895, Toulouse School of Economics (TSE).

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Stephan Marette & Roxanne Clemens & Bruce Babcock, 2008. "Recent international and regulatory decisions about geographical indications," Agribusiness, John Wiley & Sons, Ltd., vol. 24(4), pages 453-472.
    2. Jianyu Yu & Zohra Bouamra-Mechemache, 2016. "Production standards, competition and vertical relationship," European Review of Agricultural Economics, Oxford University Press and the European Agricultural and Applied Economics Publications Foundation, vol. 43(1), pages 79-111.
    3. Pierre Fleckinger, 2007. "Collective Reputation and Market Structure: Regulating the Quality vs Quantity Trade-of," Working Papers hal-00243080, HAL.
    4. Marion Desquilbet & Sylvette Monier-Dilhan, 2015. "Are geographical indications a worthy quality label? A framework with endogenous quality choice," European Review of Agricultural Economics, Oxford University Press and the European Agricultural and Applied Economics Publications Foundation, vol. 42(1), pages 129-150.
    5. Richard Carew & Wojciech J. Florkowski, 2010. "The Importance of Geographic Wine Appellations: Hedonic Pricing of Burgundy Wines in the British Columbia Wine Market," Canadian Journal of Agricultural Economics/Revue canadienne d'agroeconomie, Canadian Agricultural Economics Society/Societe canadienne d'agroeconomie, vol. 58(1), pages 93-108, March.
    6. Loïc Henry, 2023. "Adapting the designated area of geographical indications to climate change," American Journal of Agricultural Economics, John Wiley & Sons, vol. 105(4), pages 1088-1115, August.
    7. Leufkens, D., 2015. "Der Wert geschützter Herkunftsangaben in einer industrieökonomischen und hedonischen Preisanalyse," Proceedings “Schriften der Gesellschaft für Wirtschafts- und Sozialwissenschaften des Landbaues e.V.”, German Association of Agricultural Economists (GEWISOLA), vol. 50, March.
    8. Teuber, Ramona & Herrmann, Roland, 2012. "Towards a differentiated modeling of origin effects in hedonic analysis: An application to auction prices of specialty coffee," Food Policy, Elsevier, vol. 37(6), pages 732-740.
    9. Jianyu Yu & Zohra Bouamra-Mechemache & Angelo Zago, 2018. "What is in a Name? Information, Heterogeneity, and Quality in a Theory of Nested Names," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 100(1), pages 286-310.
    10. Bouamra-Mechemache, Zohra & Yu, Jianyu, 2011. "Quality Choice, Competition and Vertical Relationship in a Market of Protected Designation of Origin," 2011 International Congress, August 30-September 2, 2011, Zurich, Switzerland 114264, European Association of Agricultural Economists.
    11. Pecchioli, Bruno & Moroz, David, 2023. "Do geographical appellations provide useful quality signals? The case of Scotch single malt whiskies," Economic Modelling, Elsevier, vol. 124(C).
    12. Jacobo Núñez & David Martín‐Barroso & Francisco J. Velázquez, 2024. "The hedonic price model for the wine market: A systematic and comparative review of the literature," Agricultural Economics, International Association of Agricultural Economists, vol. 55(2), pages 247-264, March.
    13. Berríos, Rodrigo & Saens, Rodrigo, 2012. "The country brand trap," Revista CEPAL, Naciones Unidas Comisión Económica para América Latina y el Caribe (CEPAL), April.
    14. Teuber, Ramona, 2011. "Protecting Geographical Indications: Lessons learned from the Economic Literature," 2011 International Congress, August 30-September 2, 2011, Zurich, Switzerland 116081, European Association of Agricultural Economists.
    15. Leufkens, Daniel, 2014. "Der Wert Geschützter Herkunftsangaben In Einer Industrieökonomischen Und Hedonischen Preisanalyse," 54th Annual Conference, Goettingen, Germany, September 17-19, 2014 187429, German Association of Agricultural Economists (GEWISOLA).
    16. Daniele Curzi & Martijn Huysmans, 2022. "The Impact of Protecting EU Geographical Indications in Trade Agreements," American Journal of Agricultural Economics, John Wiley & Sons, vol. 104(1), pages 364-384, January.
    17. Costanigro, Marco & Scozzafava, Gabriele & Casini, Leonardo, 2017. "Vertical Differentiation, Perceptions Restructuring, And Wine Choices: The Case Of The Gran Selezione In Chianti Wines," Working Papers 253850, American Association of Wine Economists.
    18. García Arancibia, Rodrigo & Rossini, Gustavo & Depetris Guiguet, Edith, 2015. "Wine Label Descriptors and Shelf Price Paid by Argentine Consumers," Agricultural Economics Review, Greek Association of Agricultural Economists, vol. 16(2), pages 1-17.
    19. Pennerstorfer, Dieter & Weiss, Christoph R., 2011. "Do Cooperatives Offer High Quality Products? Theory and Empirical Evidence from the Wine Market," 2011 International Congress, August 30-September 2, 2011, Zurich, Switzerland 115741, European Association of Agricultural Economists.
    20. Armelle Mazé, 2023. "Geographical indications as global knowledge commons: Ostrom's law on common intellectual property and collective action," Post-Print hal-04063797, HAL.

    More about this item

    Keywords

    Marketing;

    JEL classification:

    • L15 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Information and Product Quality
    • L66 - Industrial Organization - - Industry Studies: Manufacturing - - - Food; Beverages; Cosmetics; Tobacco
    • Q13 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Agricultural Markets and Marketing; Cooperatives; Agribusiness

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:ags:aaea06:21310. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: AgEcon Search (email available below). General contact details of provider: https://edirc.repec.org/data/aaeaaea.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.