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How to Promote Quality Perception in Wine Markets: Brand Advertising or Geographic Indication?

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Author Info
Yue, Chengyan
Marette, Stephan
Beghin, John C.

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Abstract

In the context of the wine industry, we investigate producers'’ choice between geographic indications and brand advertising to convey information to consumers. Producers also decide whether or not to select an effort level for improving the quality of their products. We show that if this effort is selected, a producer will prefer to rely on brand advertising for promoting its products and set up its own reputation. Despite the sharing of the promotion cost, a geographic indication does not sufficiently reward the effort for improving quality. Finally, the selection of both instruments by producers is examined.

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Publisher Info
Paper provided by American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association) in its series 2006 Annual meeting, July 23-26, Long Beach, CA with number 21310.

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Date of creation: 2006
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Handle: RePEc:ags:aaea06:21310

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Keywords: Marketing;

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References listed on IDEAS
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  1. Marco Costanigro & Jill J. McCluskey & Ron C. Mittelhammer, 2007. "Segmenting the Wine Market Based on Price: Hedonic Regression when Different Prices mean Different Products," Journal of Agricultural Economics, Blackwell Publishing, vol. 58(3), pages 454-466, 09. [Downloadable!] (restricted)
  2. Mussa, Michael & Rosen, Sherwin, 1978. "Monopoly and product quality," Journal of Economic Theory, Elsevier, vol. 18(2), pages 301-317, August. [Downloadable!] (restricted)
  3. Fluet, Claude & Garella, Paolo G., 2002. "Advertising and prices as signals of quality in a regime of price rivalry," International Journal of Industrial Organization, Elsevier, vol. 20(7), pages 907-930, September. [Downloadable!] (restricted)
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  4. Philippe Mahenc, 2004. "Influence of Informed Buyers in Markets Susceptible to the Lemons Problem," American Journal of Agricultural Economics, American Agricultural Economics Association, vol. 86(3), pages 649-659, 08. [Downloadable!] (restricted)
  5. Marette, Stephan & Zago, Angelo, 2003. "Advertising, Collective Action, And Labeling In The European Wine Markets," Journal of Food Distribution Research, Food Distribution Research Society, vol. 34(03), November. [Downloadable!]
  6. Stéphan Marette & John Crespi, 2003. "Can Quality Certification Lead to Stable Cartels?," Review of Industrial Organization, Springer, vol. 23(1), pages 43-64, August. [Downloadable!] (restricted)
  7. Jason A. Winfree & Jill J. McCluskey, 2005. "Collective Reputation and Quality," American Journal of Agricultural Economics, American Agricultural Economics Association, vol. 87(1), pages 206-213, 02. [Downloadable!] (restricted)
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  8. Marette, Stephan & Crespi, John M & Schiavina, Allesandra, 1999. "The Role of Common Labelling in a Context of Asymmetric Information," European Review of Agricultural Economics, Oxford University Press for the Foundation for the European Review of Agricultural Economics, vol. 26(2), pages 167-78, June.
  9. Bodo Steiner, 2004. "French Wines on the Decline? Econometric Evidence from Britain," Journal of Agricultural Economics, Blackwell Publishing, vol. 55(2), pages 267-288. [Downloadable!] (restricted)
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