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Modeling Differentiated Quality Standards in the Agri-Food Sector: The Case of Meat Trade in the EU

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  • Rau, Marie-Luise
  • van Tongeren, Frank W.

Abstract

This paper looks at trade impacts of quality related standards from the supply side of the exporting country. We argue that food quality standards imposed by an importing country have profound effects on the market structure of the exporting industry, and hence a significant impact on the supply response. For our analysis, we develop a stylized oligopoly model that allows for the co-existence of complying and non-complying suppliers. The model is applied to two alternative policy options to explore different mechanisms an importing county may use to enhance the quality of its imports. We take the Polish meat sector as an empirical example, since after Poland's accession to the EU the tight EU food quality standards indeed apply but the process of adjusting to them is far from complete - particularly in Polish meat production/processing. The simulations show that a subsidy scheme, such as the EU's SAPARD program in Poland, can be an effective instrument to promote the compliance with standards and to upgrade the industry in the exporting country.

Suggested Citation

  • Rau, Marie-Luise & van Tongeren, Frank W., 2006. "Modeling Differentiated Quality Standards in the Agri-Food Sector: The Case of Meat Trade in the EU," 2006 Annual Meeting, August 12-18, 2006, Queensland, Australia 25739, International Association of Agricultural Economists.
    • Handle: RePEc:ags:iaae06:25739
    DOI: 10.22004/ag.econ.25739
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    References listed on IDEAS

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    1. Chevassus-Lozza, Emmanuelle & Majkovic, Darja & Persillet, Vanessa & Unguru, Manuela, 2005. "Technical Barriers to Trade in the European Union : Importance for the New EU Members. An Assessment for Agricultural and Food Products," 2005 International Congress, August 23-27, 2005, Copenhagen, Denmark 24621, European Association of Agricultural Economists.
    2. Hagemejer, Jan & Michalek, Jan, 2006. "Standardization union effects: the case of EU enlargement," MPRA Paper 22989, University Library of Munich, Germany.
    3. Nahuis, Richard, 2004. "One size fits all?: Accession to the internal market; an industry-level assessment of EU enlargement," Journal of Policy Modeling, Elsevier, vol. 26(5), pages 571-586, July.
    4. World Bank, 2005. "Food Safety and Agricultural Health Standards : Challenges and Opportunities for Developing Country Exports," World Bank Publications - Reports 8491, The World Bank Group.
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    Cited by:

    1. David G. Lugg & Julian A. Lampietti & Philip Van der Celen & Amelia Branczik, 2009. "The Changing Face of Rural Space : Agriculture and Rural Development in the Western Balkans," World Bank Publications - Books, The World Bank Group, number 13541.
    2. Agata Pieniadz & Heinrich Hockmann, 2008. "Factors Driving Quality Standard Compliance in the Polish Dairy Sector," Atlantic Economic Journal, Springer;International Atlantic Economic Society, vol. 36(1), pages 41-52, March.
    3. van Meijl, Hans & van Tongeren, Frank, 2001. "Multilateral Trade Liberalization and Developing Countries: A North-South Perspective on Agriculture and Processing Sectors," Conference papers 330951, Purdue University, Center for Global Trade Analysis, Global Trade Analysis Project.

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