The Impacts of Labeling on the Production and Trade of Vertically Differentiated Goods with Process Attributes

Brian Roe and Ian Sheldon

No 20451, 2001 Annual meeting, August 5-8, Chicago, IL from American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association)

Abstract: A model of vertical quality differentiation is used to analyze the introduction of continuous and binary labeling in a market for credence goods with process attributes under autarky and free trade. The results indicate that continuous labeling increases welfare under autarky and free trade so long as labeling is not too expensive. With binary labeling, consumer welfare is increased if the standard is set above the level that would be chosen under continuous labeling under autarky. In the case of free trade, the effects depend on whether binary labeling is harmonized or whether there is mutual recognition of different standards.

Keywords: Marketing (search for similar items in EconPapers)
Pages: 30
Date: 2001
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Citations: View citations in EconPapers (2)

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Persistent link: https://EconPapers.repec.org/RePEc:ags:aaea01:20451

DOI: 10.22004/ag.econ.20451

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