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Geographical indications' prices and marketing margins: the role of group size, longevity and production decisions

Francesco Bimbo (Dipartimento di Scienze Agrarie, Alimenti, Risorse Naturali e Ingegneria, Universita degli Studi di Foggia, Foggia, Italy)
Alessandro Bonanno (College of Agricultural Sciences, Colorado State University, Fort Collins, Colorado, USA)
Rosaria Viscecchia (Dipartimento di Scienze Agrarie, Alimenti, Risorse Naturali e Ingegneria, Universita degli Studi di Foggia, Foggia, Italy)

British Food Journal

ISSN: 0007-070X

Article publication date: 28 March 2022

Issue publication date: 2 January 2023

70

Abstract

Purpose

Geographical indication (GI) labels aim to improving farmers' and processors' income. This article studies how characteristics related to GI groups and their reputation (e.g. the producer group size, longevity and production decisions) are related to prices at the origin, final (consumption) prices and marketing margins.

Design/methodology/approach

The authors use 8 years of annual data for the Italian Extra Virgin Olive Oil (EVOO) GI market encompassing 46 GI EVOOs. Estimated parameters characterizing the relationship between the GI's group features and prices (at origin and at consumption) are obtained via Three-Stage Least Squares (3SLS).

Findings

Results show that the number of GI operators is related to consumption prices, while is weakly related to prices at the origin. GIs' age is not associated with higher consumption prices, while origin prices are lower for older GIs compared to younger ones. Higher farmers' olive/oil conversion rate is associated with lower origin and consumption prices, whereas the extent of vertical integration is related to higher prices at the origin and a higher share of the marketing margins going to producers.

Originality/value

To the best of their knowledge, the authors offer the first empirical evidence on how structural characteristics and production decisions of a GI group relate to prices and marketing margins.

Keywords

Acknowledgements

The authors thank Tiziana Sarnari (ISMEA) for providing data on GI EVOOs annual quantities and sales values.

Citation

Bimbo, F., Bonanno, A. and Viscecchia, R. (2023), "Geographical indications' prices and marketing margins: the role of group size, longevity and production decisions", British Food Journal, Vol. 125 No. 1, pp. 286-301. https://doi.org/10.1108/BFJ-09-2021-1000

Publisher

:

Emerald Publishing Limited

Copyright © 2022, Emerald Publishing Limited

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