Quality certification by geographical indications, trademarks and firm reputation

Luisa Menapace and GianCarlo Moschini

ISU General Staff Papers from Iowa State University, Department of Economics

Abstract: We develop a reputation model to study the concurrent use of trademarks and certification for food products with a regional identity, known as geographical indications (GIs). The model extends Shapiro’s (1983) approach to modeling reputation to a situation in which two technologies for the production of quality are available, one of which is available only in the GI region and has a cost advantage for the production of higher quality levels. In this setting, trademarks capture firm-specific reputations whereas GI certification captures a notion of collective reputation. The model shows that GI certification improves the ability of reputation to operate as a mechanism for assuring quality when it is linked to some inherent attributes of a particular production area. We discuss some welfare implications of introducing GI certification and show that an EU-style sui generis GI certification is preferable to the US-style approach based on certification marks.

Date: 2010-06-08
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Related works:
Journal Article: Quality certification by geographical indications, trademarks and firm reputation (2012)
Working Paper: Quality certification by geographical indications, trademarks and firm reputation (2012)
Working Paper: Quality Certification by Geographical Indications, Trademarks and Firm Reputation (2010)
Working Paper: Quality Certification by Geographical Indications, Trademarks and Firm Reputation (2009)
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