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Quality labels and rural development : a new economic geography approach

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  • Callois, Jean-Marc

Abstract

Some rural development strategies are based on the assumption that quality labels may act as levers for inducing economic growth and population migration to rural areas. To investigate the validity of this assumption, we use a new economic geography model. A specific (“labelled”) agricultural good is assumed to be produced by farmers who co-operate in order to set a monopoly price and control the number of producers. We find that there is a trade-off between the number of differentiated farmers and their individual income. Besides, the positive effect of agricultural differentiation on rural industrialization, due to increased demand for industrial goods, is offset by an opposite effect due to urban wages rise. Higher transport costs for the specific good favour rural industrialization but limit the size of the differentiated agricultural sector.

Suggested Citation

  • Callois, Jean-Marc, 2006. "Quality labels and rural development : a new economic geography approach," Cahiers d'Economie et de Sociologie Rurales (CESR), Institut National de la Recherche Agronomique (INRA), vol. 78.
    • Handle: RePEc:ags:inrace:201680
    DOI: 10.22004/ag.econ.201680
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    1. Cei, Leonardo & Stefani, Gianluca & Defrancesco, Edi & Lombardi, Ginevra Virginia, 2018. "Geographical indications: A first assessment of the impact on rural development in Italian NUTS3 regions," Land Use Policy, Elsevier, vol. 75(C), pages 620-630.
    2. Leonardo Cei & Edi Defrancesco & Gianluca Stefani, 2018. "From Geographical Indications to Rural Development: A Review of the Economic Effects of European Union Policy," Sustainability, MDPI, vol. 10(10), pages 1-21, October.
    3. Schaeffer, Yves & Aubert, Francis, 2010. "La pertinence de la politique rurale à l’aune des théories de la justice," Review of Agricultural and Environmental Studies - Revue d'Etudes en Agriculture et Environnement (RAEStud), Institut National de la Recherche Agronomique (INRA), vol. 91(1).
    4. Takayama, Taisuke & Norito, Takashi & Nakatani, Tomoaki & Ito, Ryoji, 2021. "Do geographical indications preserve farming in rural areas? Evidence from a natural experiment in Japan," Food Policy, Elsevier, vol. 102(C).
    5. Yves Schaeffer & Francis Aubert, 2010. "La pertinence de la politique rurale à l’aune des théories de la justice," Review of Agricultural and Environmental Studies - Revue d'Etudes en Agriculture et Environnement, INRA Department of Economics, vol. 91(1), pages 73-101.

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