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Generic Commodity Promotion And Product Differentiation

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  • Crespi, John M.

Abstract

This paper considers whether generic promotion lowers the differentiation among competing brands as claimed in the 1997 Supreme Court case (Wileman et al. v. Glickman). Commodity promotion is modeled as a multi-stage game where products are vertically differentiated. Analytical results show that if the benefits of generic advertising from increased demand are outweighed by the costs from lower product differentiation then high-quality producers will not benefit from generic promotion but producers of lower-quality goods may.

Suggested Citation

  • Crespi, John M., 1999. "Generic Commodity Promotion And Product Differentiation," 1999 Annual meeting, August 8-11, Nashville, TN 21488, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
    • Handle: RePEc:ags:aaea99:21488
    DOI: 10.22004/ag.econ.21488
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    File URL: https://ageconsearch.umn.edu/record/21488/files/sp99cr01.pdf
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    References listed on IDEAS

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    1. Alston, Julian M. & Carman, Hoy F. & Chalfant, James A. & Crespi, John M. & Sexton, Richard J. & Venner, Raymond J., 1998. "The California Prune Board's Promotion Program: An Evaluation," Research Reports 11926, University of California, Davis, Giannini Foundation.
    2. Lee, Hyunok & Alston, Julian M. & Carman, Hoy F. & Sutton, William R., 1996. "Mandated Marketing Programs For California Commodities," Information Series 11919, University of California, Davis, Giannini Foundation.
    3. Mussa, Michael & Rosen, Sherwin, 1978. "Monopoly and product quality," Journal of Economic Theory, Elsevier, vol. 18(2), pages 301-317, August.
    4. Harry M. Kaiser & Donald J. Liu, 1998. "The Effectiveness of Generic versus Brand Advertising: The Case of U.S. Dairy Promotion," Review of Agricultural Economics, Agricultural and Applied Economics Association, vol. 20(1), pages 69-79.
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    1. Crespi, John M. & Marette, Stephan, 2001. "Are Assessments For Generic Advertising Optimal If Products Are Differentiated?," 2001 Annual meeting, August 5-8, Chicago, IL 20762, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).

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