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Commitment to commercialization and quality choices in the Champagne wine producer-distributor relationship

Author

Listed:
  • Jacques-Alexandre J.-A. Laye

    (LEF - Laboratoire d'Economie Forestière - INRA - Institut National de la Recherche Agronomique - AgroParisTech)

  • Eric E. Giraud-Heraud

    (Alimentation et Sciences Sociales - INRA - Institut National de la Recherche Agronomique)

Abstract

We study the interaction in the Champagne wine producer/distributor relationship between the commitment of the producer to commercialization of a low quality wine and the high quality adjustment of the distributor. We show that this commitment can allow the producer to acquire all the pro t of the supply chain. However, at equilibrium, the distributor chooses a quality level that is superior to that obtained at the optimum of vertical integration, and manages to get a part of the pro t. The results we obtain allow us to analyze the evolution of wine supply chains when a new distributor appears and enters in competition with the producer.

Suggested Citation

  • Jacques-Alexandre J.-A. Laye & Eric E. Giraud-Heraud, 2011. "Commitment to commercialization and quality choices in the Champagne wine producer-distributor relationship," Post-Print hal-01000551, HAL.
    • Handle: RePEc:hal:journl:hal-01000551
    as

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