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Products with multiple certifications: insights from the US wine market

Author

Listed:
  • Megan E. Waldrop
  • Jill J. McCluskey
  • Ron C. Mittelhammer

Abstract

We present a product-differentiation model to analyse markets in which products may have multiple environmental and sustainability claims. We estimate hedonic price functions for California and Washington wines to quantify the implicit prices consumers are willing to pay for organic, sustainable, fish friendly and biodynamic-produced wines. We distinguish between the effects of self-claiming versus certification, in addition to assessing the returns to multiple certifications. For the most part, the different certifications have statistically different premiums. In some instances, the certified characteristic commands a lesser premium compared to the corresponding self-claimed characteristic. Having multiple certifications results in diminishing returns for the additional certification.

Suggested Citation

  • Megan E. Waldrop & Jill J. McCluskey & Ron C. Mittelhammer, 2017. "Products with multiple certifications: insights from the US wine market," European Review of Agricultural Economics, Foundation for the European Review of Agricultural Economics, vol. 44(4), pages 658-682.
  • Handle: RePEc:oup:erevae:v:44:y:2017:i:4:p:658-682.
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    File URL: http://hdl.handle.net/10.1093/erae/jbx010
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    References listed on IDEAS

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    1. repec:ags:jlaare:276501 is not listed on IDEAS
    2. repec:eee:ecolec:v:153:y:2018:i:c:p:100-110 is not listed on IDEAS
    3. Bonanno, Alessandro & Bimbo, Francesco & Costanigro, Marco & VIscecchia, Rosaria, 2018. "Do Geographic Indication Labels Pay off? Estimating GI’s implicit Price Dispersion in the Italian EVOO Market," 2018 Annual Meeting, August 5-7, Washington, D.C. 274203, Agricultural and Applied Economics Association.
    4. Markova-Nenova, Nonka & Wätzold, Frank, 2017. "Fairness to dairy cows or fairness to farmers: What counts more in the preferences of conventional milk buyers for ethical attributes of milk?," MPRA Paper 83066, University Library of Munich, Germany.

    More about this item

    Keywords

    sustainability; biodynamic; organic; salmon safe; fish friendly;

    JEL classification:

    • L15 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Information and Product Quality
    • Q13 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Agricultural Markets and Marketing; Cooperatives; Agribusiness
    • Q59 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Other

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