GENERIC COMMODITY PROMOTION AND PRODUCT DIFFERENTIATION

This paper considers whether generic promotion lowers the differentiation among competing brands as claimed in the 1997 Supreme Court case (Wileman et al. v. Glickman). Commodity promotion is modeled as a multi-stage game where products are vertically differentiated. Analytical results show that if the benefits of generic advertising from increased demand are outweighed by the costs from lower product differentiation then high-quality producers will not benefit from generic promotion but producers of lower-quality goods may.generic advertising, product differentiation, spatial model, Marketing,

ARE ASSESSMENTS FOR GENERIC ADVERTISING OPTIMAL IF PRODUCTS ARE DIFFERENTIATED?

An analytical framework where consumers display preferences for various qualities of an agricultural commodity is used to investigate the producer welfare effects of generic advertising assessments. Depending upon the degree of product differentiation present in the final goods, some producers are shown to benefit more than others from the use of an equivalent assessment on all producers. This paper delineates those cases where producer assessments should be equal and where assessments should be different to insure an equitable benefit.Marketing,

SOME ECONOMIC IMPLICATIONS OF PUBLIC LABELING

This article discusses economic issues related to public labeling. The main contributions in both the empirical and theoretical literatures are presented in order to motivate responses to the questions, when should a regulator promote public labeling, and what are the limits to and the possible market distortions from public labeling? Although the issues are complicated, there is already much economic guidance that can be given to inform the policy debate over food labeling.Agribusiness,

Geographical Indications and the Trade Related Property Rights Agreement: A Case Study of Basmati Rice Exports

The recent controversy over the granting of patenting rights to three new strains of Basmati rice by the US Patent and Trademark Office is used as a case study to analyze the impact of incomplete protection of intellectual property. Results suggest that there is evidence that the introduction of a competing product that may infringe on India's geographical indicator has harmed Indian producers in key export markets.International Relations/Trade,

Bargaining rationale for cooperative generic advertising

The beggar-thy-neighbour aspect of commodity advertising means that benefits to one commodity from advertising come at the expense of other commodities. The effect can be mitigated by cooperation among groups as shown by Alston, Freebairn and James (AFJ). A drawback to AFJ’s analysis is that some cooperative outcomes require side payments from one producer group to another. This paper offers a bargaining solution as an alternative to cooperation in the case where cooperative side payments would be needed. We show that while bargaining without side payments is not as effective as cooperation at reducing beggar-thy-neighbour effects, it is a welfare improving alternative to non-cooperation and is likely more practical in many situations.Marketing,

DO U.S. MARKETING ORDERS HAVE MUCH MARKET POWER? AN EXAMINATION OF THE ALMOND BOARD OF CALIFORNIA

This paper tests the conventional wisdom that U.S. marketing orders act as profit-maximizing cartels. The paper analyzes the marketing order for U.S. almonds in both the domestic and export markets. Such a case study is relevant to all U.S. marketing orders because the size and scope of the U.S. almond industry on the world market, and the legal authority of the almond marketing order makes it a likely prospect for exhibiting true cartel behavior. The authors find that the market power exerted by the Almond Board of California's reserve setting is significantly less than would be expected from a profit-maximizing cartel.Marketing,

The Constitutionality of Generic Advertising Checkoff Programs

Agricultural and Food Policy, Marketing, K10, Q18,