Country of Origin Labeling (C.O.O.L.): How cool is it?

Elias Dinopoulos, Grigorios Livanis and Carol West

International Review of Economics & Finance, 2010, vol. 19, issue 4, 575-589

Abstract: This paper develops a partial-equilibrium model of a small open-economy trading an unsafe product. The model is used to analyze the welfare effects of trade with and without a country-of-origin labeling (COOL) program. The welfare gains from trade in the absence of COOL are ambiguous, may justify the imposition of a trade ban. Even if a full ban does not improve welfare and some restriction of trade is always welfare-enhancing. Under a tariff regime, more COOL trade is better than less trade. Independently of domestic market power, free trade coupled with a COOL program maximizes national welfare.

Keywords: Country-of-origin; labeling; Protection; Product; safety; Welfare; Insurance; markets (search for similar items in EconPapers)
Date: 2010
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Citations: View citations in EconPapers (5)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:reveco:v:19:y:2010:i:4:p:575-589

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