Raising rivals’ costs strategy: test on two LAFS in Europe

Some Localised Agro-Food Systems (LAFS) are traditionally qualified as success stories (Comté PDO in France, Gruyere PDO in Switzerland, Parmigiano Reggiano PDO in Italy), whilst other PDOs (as for example the Cantal PDO from France) pay the same price for the milk as standard milk. The price difference may reach between 10 and 25% over a long period. To explain this difference, we assume that the agents who make up the LAFS developed a collective action to protect their localized cheese production system against unfair competition and to promote their product outside its region of origin. The aim of this communication is to shed light on levers which the agents activate to assure their uniqueness is irrevocable, and uphold the benefits of their LAFS. We propose to discuss the idea that the search for market power based on the strategy of raising rivals’ costs may be used even outside a situation of vertical integration or a situation in which pressure is applied to suppliers to challenge competitors. We assume that some companies within the LAFS have sufficient control on the rules governing the organization of the traditional system to benefit from it. They also succeed in protecting a kind of relationship between business companies. The Raising Rivals’ Costs theory helps to analyze the economic consequences of the legal set-up implementation and of its control by some companies. Indeed, we show that the collective control of the rules which are set up in the PDO legal framework explain the difficulties met by rivals to stand out through an alternative and independent production system based on the costs leadership strategy. The collective set up of institutions and rules help the agents to achieve a collective competitive advantage in which every agent benefits individually. This is the strategy developed in Europe and particularly for two PDO Localised Agro-cheese Systems: Comté PDO for France and Gruyère PDO for Switzerland.PDO, localised agro-food system, Raising rivals’ costs, regulation, Agribusiness, Agricultural and Food Policy, Community/Rural/Urban Development, Food Consumption/Nutrition/Food Safety, Labor and Human Capital,

RAISING RIVALS’ COSTS STRATEGYAND LOCALISED AGRO-FOOD SYSTEMS IN EUROPE

For some Localised Agro-Food Systems (LAFS), for ex. Comté in France, Gruyère in Switzerland, the cheese and milk prices are above average whilst others as for example the Cantal from France are similar or even below average. The objective of this paper is to shed light on levers which the agents activate to assure their uniqueness is irrevocable, and uphold the benefits of their LAFS. Raising Rivals' Costs Theory gives interesting point of view about the behaviour of firms which could make use of the collective rules to raise the costs of their competitors in the particular case of LAFS oriented to the production of traditional cheeses. This will be explored through two cases studies. In the first case (territorial collective governance mode of the local supply chain), the conditions are met to conclude that the raising costs strategy corresponds to requirements which are based to a corresponding quality which meets consumers’ expectations and willingness to pay. In the second case (sectoral governance mode), few firms have taken control on the supply chain and have imposed with the time a model based on costs leadership. As conclusion, a case-by-case in-depth approach is necessary to assess whether strategy to raise costs of the rivals damages consumers welfare in the case of PDO supply chains.PDO, localised agro-food system, Raising Rivals’ Costs, governance of LAFS, Agribusiness,

Characteristics of Traditional and Novel Food Consumers

begging of October 2010. The instrument used in this survey was a structured questionnaire consisting of several separate sections, including motivation toward food in general (Food Choice Questionnaire - FCQ), the specific questions about traditional and functional food and consumer socio-economic and demographic characteristics. The stratified three-staged random representative sample is applied (N=516). Based on reported frequency heavy traditional food consumers, who simultaneously reported lower level of functional food consumption (NT=196) and heavy functional food consumers with lower level of traditional food consumption (NF=60) are identified. A descriptive statistical analysis (parametric and non-parametric) is conducted with the aim to investigate all statistically significant differences between two consumers’ group profiles.The heavy traditional dominate over heavy functional food consumer group in Serbia. “Traditional food” in Serbia is perceived as home-made, tasty and healthy, with long heritage. Rank of motivations is very similar: after ‘taste’ - ‘price’, ‘natural content’ and ‘health’ are most frequently chosen by both consumers groups. However, the heavy traditional food consumers are more old, therefore unemployed (as retired people are considered as unemployed) and exposed to social influences. Differences in age and education between two compared consumers groups indicate possible transition of diet pattern toward more frequent functional food consumption

Assessing the role of the research in the transition to organic farming by using the Actor Network Theory: lessons from two case studies in France and Bulgaria

This paper explores the potential of Actor Network Theory (ANT) in understanding how the process of interaction and translation between human and non-human actors contribute to the development, adoption and diffusion of science-based innovations linked to the transition to organic farming. The study relies on two case studies, the French Camargue case covering a range of technical and social innovations, and the case from Bulgaria focusing on the development of a technical and product innovation, i.e. a veterinary product for organic beekeeping. The paper shows the limitations of classical approaches in studying innovations since they underestimate the role of heterogeneous actors, their status, and how they interact with each other. We argue that focusing on actors’ interactions helps to better understand the so-called “uncertainties” and “turning points” in the innovation development, as well as to interpret them as natural elements. Moreover we argue that challenges to tackle should be problematized to increase the success of research programs. We also stress the importance of opinion leaders during the implementation and diffusion phase of the innovation

Using social network analysis to evaluate the impacts of the research: on the transition to organic farming in the Camargue

This paper evaluates the relevance of undertaking a Social Network Analysis (SNA) to better understand the role played by the network of actors during innovation processes as well as validate stakeholders’ views on actors’ relationships in a case study on the transition to organic farming in the Camargue territory (South of France). The SNA method is part of a set of methods that forms an approach that was developed to evaluate ex-post the impacts of agronomic research in the framework of the European research project IMPRESA. The analysis particularly confirms, through the indicator of Betweenness, the growing role played by INRA (French National Institute of Agronomic Research) in the network and its contribution to the transition to organic agriculture. This is due in particular to closer relationships between farmers and INRA. The results also indicate a growing role played by CIRAD (Agricultural Research Center for International Development) through the lens of increased relationships with farmers. Additionally, the analysis confirms the great influence of the creation of the firm Biosud in 2003 on the transition to organic farming. SNA proved to be an excellent research tool for confirming stakeholders’ statements about impact pathway, the events described in it, and the intensity of links between events. The reconstruction of the actor network over 5 different periods allows a significant deepening of the analysis. This method could be more largely used in evaluating impacts of research

La politique agricole suisse entre économie, écologie et société

Ce dossier explore quelques aspects de la politique agricole et de l’économie rurale suisses. Fondée sur la notion de sécurité alimentaire dans l’après-guerre, la politique agricole suisse a d’abord été marquée par la volonté de préserver une capacité productive capable de nourrir sa population en cas de crise ou de conflit. Elle a donc établi une forte protection aux frontières et des aides sélectives toujours plus importantes en faveur des exploitations situées en zone défavorisée, particul..

Transition to organic production

We present the main characteristics and results of the Camargue case study. The case study was about the evaluation of a research program focusing on the transition to organic farming (the research program was launched in 2000)

COMPARAISON ENTRE LES SYSTEMES DE CONNAISSANCES AGRICOLES DE SEPT PAYS EUROPEENS

International audienceComparison between agricultural knowledge systems in seven european countries. This paper compares knowledge systems which embrace all the actors implied in the production, diffusion and use of knowledge concerning agriculture. With the change in role of agriculture from a production function to multifunctionnality, institutional change driven by public funding as well as the repartition between different institutions of competences and functions are becoming essential questions. Based on an analysis on the repartition of the competences, the modes of governance and funding in seven European countries, this paper proposes several elements to contribute to the debate

IMPRESA WP3: Case Study Report - Transition towards organic farming in the Camargue

In this report we assess the contribution, role, and impacts of the Science-Based Research and Innovation Program (ISRIP) on farmers’ transition to organic production in the Camargue. We have applied a qualitative method based on the Participatory Impact Pathway Analysis (PIPA) and complemented by other methods to adapt it to the requirements of an-ex-post evaluation (with Outcome Harvesting), to identify the role played by the different actors along the innovation pathway (with the Social Network Analysis), to validate the pathway links (with the Process tracing) and to identify the crucial components in the pathway (by asking counterfactual questions to stakeholders). We demonstrate that the research has played a limited role to support farmers’ transition to organic farming in the Camargue. Three main evidences were identified: (1) informal testing made by farmers on crop rotation were very important to help them to convert to organic farming; (2) economic factors were also important and even indispensable; and (3) the institutionalization of the supply chain for organic rice was seen as a crucial factor in the pathway

IMPRESA case study brief: Transition to organic production - The case of the Camargue in France

This case study focuses on the transition to organic farming in the French Camargue. A research programme was launched in the year 2000 with the objective of expanding organic farming in the territory and thus responding to the severe environmental problems, e.g. the pollution of the Rhône River. The main impacts of the research – additionally driven by external factors, especially economic ones – are the increase in the surface under organic rice (the main crop in the territory) as well as increased revenues at farm level. We hereby trace back the innovation pathway, describe the key influencing factors and draw general conclusions for research and innovation in EU agriculture