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When are Private Standards more Stringent then Public Standards?

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  • Thijs Vandemoortele

Abstract

Retailers’ private standards are increasingly important in addressing consumer concerns about safety, quality and social and environmental issues. Empirical evidence shows that these private standards are frequently more stringent than their public counterparts. I develop a political economy model that may contribute to explaining this stylized fact. I show that if producers exercise their political power to persuade the government to impose a lower public standard, retailers may apply their market power to install a private standard at a higher level than the public one, depending on several factors.

Suggested Citation

  • Thijs Vandemoortele, 2011. "When are Private Standards more Stringent then Public Standards?," LICOS Discussion Papers 29611, LICOS - Centre for Institutions and Economic Performance, KU Leuven.
  • Handle: RePEc:lic:licosd:29611
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    File URL: http://www.econ.kuleuven.be/licos/publications/dp/dp296.pdf
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    References listed on IDEAS

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    Citations

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    Cited by:

    1. Johan Swinnen, 2014. "Global Agricultural Value Chains, Standards, and Development," RSCAS Working Papers 2014/30, European University Institute.
    2. John C. Beghin & Miet Maertens & Johan Swinnen, 2017. "Nontariff Measures and Standards in Trade and Global Value Chains," World Scientific Book Chapters,in: Nontariff Measures and International Trade, chapter 2, pages 13-38 World Scientific Publishing Co. Pte. Ltd..
    3. Maertens, Miet & Swinnen, Johan, 2015. "Agricultural trade and development: A value chain perspective," WTO Staff Working Papers ERSD-2015-04, World Trade Organization (WTO), Economic Research and Statistics Division.
    4. Jean-Christophe Bureau & Thorsten Rogall, 2017. "EU Policies and Global Food Security," LICOS Discussion Papers 39217, LICOS - Centre for Institutions and Economic Performance, KU Leuven.
    5. Vanessa von Schlippenbach & Isabel Teichmann, 2012. "The Strategic Use of Private Quality Standards in Food Supply Chains," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 94(5), pages 1189-1201.
    6. Meloni, Giulia & Swinnen, Johan, 2017. "Standards, Tariffs And Trade: The Rise And Fall Of The Raisin Trade Between Greece And France In The Late 19th Century And The Definition Of Wine," Working Papers 253853, American Association of Wine Economists.
    7. repec:eee:agisys:v:163:y:2018:i:c:p:45-57 is not listed on IDEAS
    8. Venus, Thomas & Punt, Maarten & Wesseler, Justus, 2015. "Influence of voluntary GMO-free production standards on the reputation and flexibility of agricultural value chains," 2015 Conference, August 9-14, 2015, Milan, Italy 211920, International Association of Agricultural Economists.

    More about this item

    Keywords

    Private standards; public standards; political economy;

    JEL classification:

    • D72 - Microeconomics - - Analysis of Collective Decision-Making - - - Political Processes: Rent-seeking, Lobbying, Elections, Legislatures, and Voting Behavior
    • L15 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Information and Product Quality

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