Optimal Institutional Mechanisms for Funding Generic Advertising: An Experimental Analysis

Kent Messer (), Todd Schmit and Harry Kaiser

American Journal of Agricultural Economics, 2005, vol. 87, issue 4, 1046-1060

Abstract: Given the uncertain legal status of generic advertising programs for agricultural commodities, alternative voluntary funding institutions are investigated that could provide a high level of benefits to producers. This experimental study simulates key economic and psychological factors that affect voluntary producer contributions to generic advertising. The results suggest that producer referenda play a critical role in increasing contributions and that producer surplus is maximized by a provision point mechanism instituted by producer referendum with thresholds ranging from 68% to 90%, and expected funding from 47% to 77% of the time, depending on the level of advertising effectiveness. Copyright 2005, Oxford University Press.

Date: 2005
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Working Paper: Optimal Institutional Mechanisms for Funding Generic Advertising: An Experimental Analysis (2005)
Working Paper: Optimal Institutional Mechanisms for Funding Generic Advertising: An Experimental Analysis (2004)
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Persistent link: https://EconPapers.repec.org/RePEc:oup:ajagec:v:87:y:2005:i:4:p:1046-1060

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