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Determinants of Adoption of Protected Designation of Origin Label: Evidence from the French Brie Cheese Industry

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  • Zohra Bouamra-Mechemache
  • Jad Chaaban

Abstract

This paper investigates empirically the determinants of agro-food firms' adoption of the Protected Designation of Origin (PDO) label. A unique dataset containing firm-level cost and production information on the French Brie cheese is used, covering the period 1980-2000. The Brie cheese data are especially relevant as PDO Brie producers have coexisted with other non-PDO producers since 1981. To evaluate the producers' incentive to opt for PDO certification, we use a structural switching regression model which incorporates cost and production structure variables. Results show that PDO certification is less attractive the higher the costs of raw materials and the greater the size of the company. PDO Brie cheese production costs are estimated to be on average 40% higher than those for non-PDO Brie. The PDO production process could be technically inefficient when compared with the unconstrained non-PDO manufacturing; yet, PDO producers benefit from a price premium on their product which offsets their higher production cost. Copyright (c) 2010 The Authors. Journal compilation (c) 2010 The Agricultural Economics Society.

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Bibliographic Info

Article provided by Wiley Blackwell in its journal Journal of Agricultural Economics.

Volume (Year): 61 (2010)
Issue (Month): 2 ()
Pages: 225-239

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Handle: RePEc:bla:jageco:v:61:y:2010:i:2:p:225-239

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Web page: http://www.blackwellpublishing.com/journal.asp?ref=0021-857X

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Cited by:
  1. Bontemps, Christophe & Bouamra-Mechemache, Zohra & Simioni, Michel, 2012. "Quality Labels and Firm Survival in the French Cheese Industry," IDEI Working Papers 741, Institut d'Économie Industrielle (IDEI), Toulouse.
  2. Diez-Vial, Isabel, 2011. "Geographical cluster and performance: The case of Iberian ham," Food Policy, Elsevier, vol. 36(4), pages 517-525, August.
  3. Bouamra-Mechemache, Zohra & Yu, Jianyu, 2011. "Quality Choice, Competition and Vertical Relationship in a Market of Protected Designation of Origin," 2011 Annual Meeting, July 24-26, 2011, Pittsburgh, Pennsylvania 103607, Agricultural and Applied Economics Association.
  4. Bouamra-Mechemache, Zohra & Chaaban, Jad, 2010. "Is the Protected Designation of Origin (PDO) Policy Successful in Sustaining Rural Employment?," 116th Seminar, October 27-30, 2010, Parma, Italy 94987, European Association of Agricultural Economists.
  5. Dentoni, Domenico & Menozzi, Davide & Capelli, Maria Giacinta, 2012. "Group heterogeneity and cooperation on the geographical indication regulation: The case of the “Prosciutto di Parma” Consortium," Food Policy, Elsevier, vol. 37(3), pages 207-216.
  6. Di Vita, Giuseppe & D'Amico, Mario, 2013. "Origin Designation And Profitability For Small Wine Grape Growers: Evidence From A Comparative Study," Economics of Agriculture, Institute of Agricultural Economics, vol. 60(1).
  7. Bontemps, Christophe & Bouamra-Mechemache, Zohra & Simioni, Michel, 2010. "Firm Survival and Quality Labels in the Food Industry," 2010 Annual Meeting, July 25-27, 2010, Denver, Colorado 61377, Agricultural and Applied Economics Association.
  8. Resano, Helena & Sanjuán, Ana I. & Albisu, Luis M., 2012. "Consumers’ response to the EU Quality policy allowing for heterogeneous preferences," Food Policy, Elsevier, vol. 37(4), pages 355-365.
  9. Bouamra-Mechemache, Zohra & Jianyu, Yu, 2013. "Production Standards, Competition and Vertical Relationship," TSE Working Papers 13-417, Toulouse School of Economics (TSE).

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