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Does VQA Certification Matter? A Hedonic Analysis

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Author Info
Danielle E. Rabkin
Timothy K.M. Beatty
Abstract

The Vintners Quality Alliance (VQA) program was established in British Columbia in 1990 in response to international pressure that opened the BC wine market to increased foreign competition. The VQA program aimed at improving the quality of British Columbia-produced wines by outlining standards and regulations for wine produced 100 percent from BC grown grapes. Wine sales in British Columbia are rapidly increasing, w i t h domestically produced Canadian wines having the largest market share. This research examines consumers' valuation of VQA certification through a hedonic price analysis. Results show that consumers are willing to pay a premium for VQA red and white wines. However, the benefits of VQA certification are asymmetric: certification is less important for high-priced wines than for low-priced wines.

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Article provided by University of Toronto Press in its journal Canadian Public Policy.

Volume (Year): 33 (2007)
Issue (Month): 3 (September)
Pages: 299-314
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Handle: RePEc:cpp:issued:v:33:y:2007:i:3:p:299-314

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  1. Combris, Pierre & Lecocq, Sebastien & Visser, Michael, 1997. "Estimation for a Hedonic Price Equation for Bordeaux Wine: Does Quality Matter?," Economic Journal, Royal Economic Society, vol. 107(441), pages 390-402, March. [Downloadable!] (restricted)
  2. Rosen, Sherwin, 1974. "Hedonic Prices and Implicit Markets: Product Differentiation in Pure Competition," Journal of Political Economy, University of Chicago Press, vol. 82(1), pages 34-55, Jan.-Feb.. [Downloadable!] (restricted)
  3. Joseph Gyourko & Joseph Tracy, 1999. "A look at real housing prices and incomes: some implications for housing affordability and quality," Economic Policy Review, Federal Reserve Bank of New York, issue Sep, pages 63-77. [Downloadable!]
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  4. Nerlove, Marc, 1995. "Hedonic price functions and the measurement of preferences: The case of Swedish wine consumers," European Economic Review, Elsevier, vol. 39(9), pages 1697-1716, December. [Downloadable!] (restricted)
  5. Peter G. Moffatt & Simon A. Peters, 2004. "Pricing Personal Services: An Empirical Study of Earnings in the UK Prostitution Industry," Scottish Journal of Political Economy, Scottish Economic Society, vol. 51(5), pages 675-690, November. [Downloadable!] (restricted)
  6. Erik Lehmann, 2003. "Pricing Behavior on the WEB: Evidence from Online Travel Agencies," Empirica, Springer, vol. 30(4), pages 379-396, December. [Downloadable!] (restricted)
  7. G¸nter Schamel & Kym Anderson, 2003. "Wine Quality and Varietal, Regional and Winery Reputations: Hedonic Prices for Australia and New Zealand," The Economic Record, The Economic Society of Australia, vol. 79(246), pages 357-369, 09. [Downloadable!] (restricted)
  8. Oczkowski, Edward, 1994. "A Hedonic Price Function For Australian Premium Table Wine," Australian Journal of Agricultural Economics, Australian Agricultural and Resource Economics Society, vol. 38(01), April. [Downloadable!]
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