Collective Marketing Arrangements for Geographically Differentiated Agricultural Products: Welfare Impacts and Policy Implications
This paper examines the incentive of atomistic agricultural producers within a specific geographical region to differentiate and collectively market products. We develop a model that allows us to analyze the market and welfare effects of the main types of real-world producer organizations, using it to derive economic insights regarding the circumstances under which these organizations will evolve, and describing implications of the results obtained in the context of an ongoing debate between the European Union and United States. As the anticipated fixed costs of development and marketing increase and the anticipated size of the market falls, it becomes essential to increase the ability of the producer organization to control supply in order to ensure the coverage of fixed costs. Whenever a collective organization allows a market (with a new product) to exist that otherwise would not have existed there is an increase in societal welfare. Counterintuitively, stronger property right protection for producer organizations may be welfare enhancing even after a differentiated product has been developed. The reason for this somewhat paradoxical result is that legislation aimed at curtailing the market power of producer organizations may induce large technological distortions.
|Date of creation:||May 2006|
|Contact details of provider:|| Postal: 578 Heady Hall, Ames, Iowa, 50011-1070|
Web page: https://www.card.iastate.edu/
More information through EDIRC
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Dermot J. Hayes & Sergio H. Lence & Andrea Stoppa, 2004.
John Wiley & Sons, Ltd., vol. 20(3), pages 269-285.
- Hayes, Dermot J. & Lence, Sergio H., 2002. "Farmer-Owned Brands?," Staff General Research Papers Archive 12707, Iowa State University, Department of Economics.
- Hayes, Dermot J. & Lence, Sergio H. & Stoppa, Andrea, 2004. "Farmer-Owned Brands?," Staff General Research Papers Archive 11285, Iowa State University, Department of Economics.
- Hayes, Dermot J. & Lence, Sergio H & Stoppa, Andrea, 2004. "Farmer-Owned Brands?," ISU General Staff Papers 200407140700001012, Iowa State University, Department of Economics.
- Dermot J. Hayes & Sergio H. Lence & Andrea Stoppa, 2003. "Farmer-Owned Brands?," Center for Agricultural and Rural Development (CARD) Publications 02-bp39, Center for Agricultural and Rural Development (CARD) at Iowa State University.
- Stéphan Marette & John Crespi, 2003. "Can Quality Certification Lead to Stable Cartels?," Review of Industrial Organization, Springer;The Industrial Organization Society, vol. 23(1), pages 43-64, August. Full references (including those not matched with items on IDEAS)
When requesting a correction, please mention this item's handle: RePEc:ias:mpaper:06-mwp9. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: ()
If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.
If references are entirely missing, you can add them using this form.
If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.
If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.
Please note that corrections may take a couple of weeks to filter through the various RePEc services.