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The strategic use of private quality standards in food supply chains

Vanessa von Schlippenbach and Isabel Teichmann

No 62, DICE Discussion Papers from University of Düsseldorf, Düsseldorf Institute for Competition Economics (DICE)

Abstract: We explore the strategic role of private quality standards in food supply chains. Considering two symmetric retailers that are exclusively supplied by a finite number of producers and endogenizing the suppliers' delivery choice, we show that there exist two asymmetric equilibria in the retailers' quality requirements. Our results reveal that the retailers use private quality standards to improve their bargaining position in the intermediate goods market. This is associated with inefficiencies in the upstream production, which can be mitigated by enforcing a minimum quality standard.

Keywords: private quality standards; vertical relations; buyer power; food supply chain (search for similar items in EconPapers)
JEL-codes: L15 L42 Q13 (search for similar items in EconPapers)
Date: 2012
New Economics Papers: this item is included in nep-agr and nep-com
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Related works:
Journal Article: The Strategic Use of Private Quality Standards in Food Supply Chains (2012) Downloads
Working Paper: The Strategic Use of Private Quality Standards in Food Supply Chains (2011) Downloads
Working Paper: The Strategic Use of Private Quality Standards in Food Supply Chains (2011) Downloads
Working Paper: The Strategic Use of Private Quality Standards in Food Supply Chains (2011) Downloads
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