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Consumer Preferences for Country-Of-Origin, Geographical Indication, and Protected Designation of Origin Labels

  • Menapace, Luisa
  • Colson, Gregory J.
  • Grebitus, Carola
  • Facendola, Maria

Motivated by the recognition that geography is often correlated with and/or an important determinant of the overall quality of agricultural products, consumer groups, industry representatives, and domestic and trade representatives have increasingly considered the potential role of geographical origin labels as consumer information and marketing tools. We investigate whether consumers recognize and value the informational content of a variety of nested geographical origin labels. In particular, this study disentangles and assesses three nested types of origin labels: country of origin (COOL), geographical indications (GI), and PDO/PGI. We find that, within the context of a high quality valueadded commodity such as extra virgin olive oil, consumers' willingness to pay varies across different countries of origin, and that within a country consumers have a greater willingness to pay for GI-labeled than non-GI labeled products. We also find evidence that consumers value PDOs more than PGIs, but the result is not as strong as that found for GI versus non-GI. Overall, our findings support the recent surge in interest by both developed and developing nations in reaching an agreement for stricter and more widespread protection of GIs within ongoing WTO discussions and harnessing them as marketing tools for expanding shares in export markets.

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Paper provided by Iowa State University, Department of Economics in its series Staff General Research Papers with number 13122.

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Date of creation: 02 Nov 2009
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Handle: RePEc:isu:genres:13122
Contact details of provider: Postal: Iowa State University, Dept. of Economics, 260 Heady Hall, Ames, IA 50011-1070
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Web page: http://www.econ.iastate.edu
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  1. Moschini, GianCarlo & Menapace, Luisa & Pick, Daniel, 2008. "Geographical Indications and the Competitive Provision of Quality in Agricultural Markets," Staff General Research Papers 12858, Iowa State University, Department of Economics.
  2. Wuyang Hu & Michele Veeman & Wiktor Adamowicz & Ge Gao, 2006. "Consumers' Food Choices with Voluntary Access to Genetic Modification Information," Canadian Journal of Agricultural Economics/Revue canadienne d'agroeconomie, Canadian Agricultural Economics Society/Societe canadienne d'agroeconomie, vol. 54(4), pages 585-604, December.
  3. Scarpa Riccardo & Del Giudice Teresa, 2004. "Market Segmentation via Mixed Logit: Extra-Virgin Olive Oil in Urban Italy," Journal of Agricultural & Food Industrial Organization, De Gruyter, vol. 2(1), pages 1-20, August.
  4. Sergio H. Lence & Stéphan Marette & Dermot J. Hayes & William E. Foster, 2006. "Collective Marketing Arrangements for Geographically Differentiated Agricultural Products: Welfare Impacts and Policy Implications," Midwest Agribusiness Trade Research and Information Center (MATRIC) Publications 06-mwp9, Midwest Agribusiness Trade Research and Information Center (MATRIC) at Iowa State University.
  5. Céline Bonnet, 2001. "Assessing consumer response to Protected Designation of Origin labelling: a mixed multinomial logit approach," European Review of Agricultural Economics, Foundation for the European Review of Agricultural Economics, vol. 28(4), pages 433-450, December.
  6. Green, Paul E & Srinivasan, V, 1978. " Conjoint Analysis in Consumer Research: Issues and Outlook," Journal of Consumer Research, University of Chicago Press, vol. 5(2), pages 103-23, Se.
  7. Colin Carter & Barry Krissoff & Alix Peterson Zwane, 2006. "Can Country-of-Origin Labeling Succeed as a Marketing Tool for Produce? Lessons from Three Case Studies," Canadian Journal of Agricultural Economics/Revue canadienne d'agroeconomie, Canadian Agricultural Economics Society/Societe canadienne d'agroeconomie, vol. 54(4), pages 513-530, December.
  8. Medicamento, Umberto & De Gennaro, Bernardo, 2006. "Social Networks and Supplychain Management in Rural Areas: A Case Study Focusing on Organic Olive Oil," 2006 Annual Meeting, August 12-18, 2006, Queensland, Australia 25266, International Association of Agricultural Economists.
  9. Teuber, Ramona, 2007. "Geographical Indications of Origin as a Tool of Product Differentiation: The Case of Coffee," 105th Seminar, March 8-10, 2007, Bologna, Italy 7866, European Association of Agricultural Economists.
  10. Tim Josling, 2006. "The War on "Terroir": Geographical Indications as a Transatlantic Trade Conflict," Journal of Agricultural Economics, Wiley Blackwell, vol. 57(3), pages 337-363.
  11. Rigby, Dan & Burton, Michael P. & Young, Trevor, 2005. "Precaution and Protectionism: GM Food and the WTO," 2005 International Congress, August 23-27, 2005, Copenhagen, Denmark 24447, European Association of Agricultural Economists.
  12. Baker, Gregory A. & Burnham, Thomas A., 2001. "Consumer Response To Genetically Modified Foods: Market Segment Analysis And Implications For Producers And Policy Makers," Journal of Agricultural and Resource Economics, Western Agricultural Economics Association, vol. 26(02), December.
  13. Sterns, James A. & House, Lisa & VanSickle, John J. & Wysocki, Allen F., 2004. "COOL and Consumers' Willingness to Pay in the Fresh Produce Industry - Some Initial Impressions from the Field," Working Papers 15644, University of Florida, International Agricultural Trade and Policy Center.
  14. Loureiro, Maria L. & Umberger, Wendy J., 2002. "Estimating Consumer Willingness-To-Pay For Country Of-Origin-Labels For Beef Products," 2002 Annual meeting, July 28-31, Long Beach, CA 19745, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
  15. Nelson, Philip, 1974. "Advertising as Information," Journal of Political Economy, University of Chicago Press, vol. 82(4), pages 729-54, July/Aug..
  16. Loureiro, Maria L. & Umberger, Wendy J., 2003. "Estimating Consumer Willingness to Pay for Country-of-Origin Labeling," Journal of Agricultural and Resource Economics, Western Agricultural Economics Association, vol. 28(02), August.
  17. Krystallis, Athanasios & Ness, Mitchell, 2005. "Consumer Preferences for Quality Foods from a South European Perspective: A Conjoint Analysis Implementation on Greek Olive Oil," International Food and Agribusiness Management Review, International Food and Agribusiness Management Association (IAMA), vol. 8(02).
  18. Roxanne Clemens & Bruce A. Babcock, 2004. "Country of Origin as a Brand: The Case of New Zealand Lamb," Center for Agricultural and Rural Development (CARD) Publications 04-mbp9, Center for Agricultural and Rural Development (CARD) at Iowa State University.
  19. Turkekul, Berna & Gunden, Cihat & Abay, Canan & Miran, Bulent, 2007. "A Market Share Analysis of Virgin Olive Oil Producer Countries with special respect to Competitiveness," 103rd Seminar, April 23-25, 2007, Barcelona, Spain 9410, European Association of Agricultural Economists.
  20. James Rude & Javed Iqbal & Derek Brewin, 2006. "This Little Piggy Went to Market with a Passport: The Impacts of U.S. Country of Origin Labeling on the Canadian Pork Sector," Canadian Journal of Agricultural Economics/Revue canadienne d'agroeconomie, Canadian Agricultural Economics Society/Societe canadienne d'agroeconomie, vol. 54(3), pages 401-420, 09.
  21. Akerlof, George A, 1970. "The Market for 'Lemons': Quality Uncertainty and the Market Mechanism," The Quarterly Journal of Economics, MIT Press, vol. 84(3), pages 488-500, August.
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