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In our study, we tried to collect empirical studies focusing on the economic impact of Geographical Indications (GIs). Using a systematic literature review approach, we investigated three different aspects: market size, price premium and impacts on rural development. Based on the findings of studies both from the grey and academic literature, the results are quite mixed. Though the number of GI-related empirical studies has risen in recent years, there is a lack of economic data to support policies related to GIs, even in the European Union (EU), where the most important GI system exists. Overall, it is impossible to draw any general conclusions about the economic impact of GIs. Some countries have remarkable GI market size, and some GI products have a determinative role in both domestic and export markets; however, it is not general. Again, some particular GI products of some regions could gain significant price premiums, but due to the associated higher production costs and unequal distribution in the value chain, it might not result in higher producer incomes. The most conflicting empirical results were found in how GIs can contribute to regional prosperity, as evidences of the harmful effects of GIs on rural development were also identified.
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Understanding the Real-World Impact of
Geographical Indications: A Critical Review of the
Empirical Economic Literature
Áron Török 1, * , Lili Jantyik 1, Zalán Márk Maró1and Hazel V. J. Moir 2
Department of Agribusiness, Institute for the Development of Enterprises, Corvinus University of Budapest,
1093 Budapest, Hungary; (L.J.); (Z.M.M.)
2Centre for European Studies, Research School of Social Sciences, Australian National University,
Canberra 2600, Australia;
*Correspondence:; Tel.: +36-1-482-5397
Received: 7 October 2020; Accepted: 8 November 2020; Published: 12 November 2020
In our study, we tried to collect empirical studies focusing on the economic impact of
Geographical Indications (GIs). Using a systematic literature review approach, we investigated three
dierent aspects: market size, price premium and impacts on rural development. Based on the
findings of studies both from the grey and academic literature, the results are quite mixed. Though
the number of GI-related empirical studies has risen in recent years, there is a lack of economic data
to support policies related to GIs, even in the European Union (EU), where the most important GI
system exists. Overall, it is impossible to draw any general conclusions about the economic impact of
GIs. Some countries have remarkable GI market size, and some GI products have a determinative role
in both domestic and export markets; however, it is not general. Again, some particular GI products
of some regions could gain significant price premiums, but due to the associated higher production
costs and unequal distribution in the value chain, it might not result in higher producer incomes.
The most conflicting empirical results were found in how GIs can contribute to regional prosperity,
as evidences of the harmful eects of GIs on rural development were also identified.
Keywords: geographical indications; PDO; PGI; market size; price premium; rural development
1. Introduction
Geographical Indications (GIs) were introduced into international trade treaties by the European
Union (EU) during the Uruguay Round trade negotiations. Although strongly resisted by the USA
and other New World countries, the 1994 Trade-Related Aspects of Intellectual Property Rights (TRIPS)
Agreement, under the World Trade Organization (WTO) Agreement, created an eective compromise.
Since then the EU has been a strong advocate for increasingly strong GI regulation and consultations
are currently under way to further strengthen EU GI regulations.
Within the EU, the GI program is managed by the Directorate-General, Agriculture and Regional
Development. In this paper, the focus is on how GIs perform as an instrument of agricultural and
regional policy, reflecting the EU arrangements. Our particular focus in this study is on the size of the
market for GI products, the extent to which they contribute to increased net producer income and the
extent to which they contribute to regional development. There are, of course, many other important
questions about how GIs operate, for example what price premiums consumers are willing to pay,
but these are beyond the scope of this particular study (several comprehensive reviews on GI related
WTP exist, however with conflicting results. Even in the European Union, the recognition of GI labels
is low and other quality attributes of food products (brand in particular) might have a greater influence
on purchasing decision, therefore the role of GIs on WTP for quality food product is not clear).
Sustainability 2020,12, 9434; doi:10.3390/su12229434
Sustainability 2020,12, 9434 2 of 24
By 2009 GI systems were used already in 167 countries and regions. Recently China has become
the country with the largest number of registered GIs, but for many years the majority of registered
GIs were found in the EU [
]. In general, in bilateral trade agreements between the EU and other
countries, the number of GIs in the EU (and listed for inclusion in trade treaties) far exceeds the number
in partner countries.
The EU-wide system for GIs was first introduced in 1992 [
] and has been revised twice since then
(in 2006 [
] and 2012 [
]). The EU system has two major types of GI. Protected Designations of Origin
(PDOs) are very similar to the French Appellation d’Origine Contr
e (AOC) system, already existing
before the EU GI system [
]. Protected Geographical Indications (PGIs) have a German origin with
a strong reputational element but a much lower link to the place of origin [
]. Just five EU Member
States (Italy, France, Spain, Portugal and Greece) are the primary users of the EU’s GI system, both in
terms of the number of registered products and in economic importance.
Recent trade agreements clearly indicate the political importance for the EU places on GI policy.
In current negotiations with both Australia and New Zealand, the EU has again indicated that GIs
are an essential element in any trade agreement. This may be surprising considering their limited
economic importance in both domestic production and international trade. According to the results of
research published in 2019 [
], on average, the share of GI products in the national food and drink
industry in 2017 was around 7% in the EU Member States. Further, 58% of EU GI production is sold in
domestic markets, and only 22% of EU GI products is sold outside of Europe. Of GI exports, 90% are
wines or spirits. The primary beneficiaries of GI labelled exports are France and Italy. But largely due
to very limited available data, there is as yet little general analysis of the economic impact of GI policy
for either particular product lines or particular countries.
It needs to be said that there are significant methodological challenges in separating the impact
of GI policy—which is eectively a regulation about food labelling—from other closely associated
characteristics. It is not a simple matter to isolate the eects of a product’s quality in itself, from the
place it is made, in itself, from the GI label that proclaims the place-product combination is regulated.
Further, a GI labelled product may also carry a trademark and, as will be seen from the literature
reviewed below, the GI and trademark labels not always work in harmony. The lack of useful data
does not make these challenges any easier.
Despite the limited data, there is a voluminous literature on GIs. Given the data limitations,
much of this literature is theoretical or conceptual, drawing conclusions on this basis rather than on
empirically verified data. To the best of our knowledge, so far, there were only a few attempts to
synthesise the evidence-based literature on GIs.
But these existing GI literature reviews focus mainly on the European system and only give general
overviews of the available resources, both in terms of methodologies and disciplines (see Table 1).
None had the primary purpose of assessing the empirical results. Rather they considered the GI
literature from a specific viewpoint (e.g., welfare implications, consumers’ attitudes, or simply the
papers from a given geographical region).
Marchesini, et al. [
] conducted a literature review on the perception of agro-foods quality cues
in the international environment, where GIs were one of several quality attributes. In his conceptual
paper R
quillart [
] reviewed willingness to pay (WTP) research, summarising eight previous studies
on consumers’ willingness to pay for GI products. Barjolle, et al. [
] collected the methods used for
evaluating GI systems and summarised the results of the EU funded SINER-GI project designed to
raise GI awareness. Teuber and her co-authors reviewed the (mainly theoretical) economic literature
on GIs, focusing on the welfare implications, concluding with some empirical findings that consumers
prefer local and GI food [12,13].
Sustainability 2020,12, 9434 3 of 24
Table 1. Studies reviewing academic literature on GIs.
Author (Year)
[Reference] Country/Region Issues Reviewed Key Findings
Marchesini et al.
(2007) [9]
Various, EU and
extra EU
Perception of
agricultural product
and foodstu
quality cues
It is unlikely that the EU GI system would be
recognised outside of Europe.
Authenticity is not always a quality attribute, and
large scale industries can produce products with
high quality where the origin is not the most
important attribute. Other quality attributes (like
animal welfare, protection of natural resources)
might appear in the EU parallel with the GI labels.
Réquillart (2007)
[10]EU Welfare impacts of GIs
PDO/PGI labels, but also trademarks, usually
achieve a higher value on the market, though brands
sometimes realise higher positive values and the GI
and trademark labels interact with each other. But
there are exceptions where the GI label as a signal of
quality is only partially accompanied with a positive
willingness to pay. Some of the studies reviewed
suggested that GIs could result in higher prices, but
these are often needed to cover the additional costs
of GI production. Overall, there is no clear evidence
that the income level of GI farmers would be higher.
Barjolle et al. (2009)
Various, EU and
extra EU
Methods for assessing
the territorial impact of
GIs and analysis of 14
case studies from the
SINER-GI project
The impacts of GI systems are more linked with
economic or economic-related issues (e.g., market
stabilisation, price premium, value-added in the
producing region) than social and
environmental ones.
Teuber et al. (2011)
Various, EU and
extra EU
GI welfare
willingness to pay
Consumer ethnocentrism (belief in the inherent
superiority of products from one’s own region) or
support warranty (supporting local or extra-local
because of characteristics such as fair trade)
dimensions are important for consumers when they
decide about the purchase of local food (or GI
products in particular), but not all consumers prefer
origin attributes per se. Agri-food products have
several quality dimensions beside origin, and they
can be not only complementary but also
substitutable with remarkable trade-oeects.
Deselnicu et al. (2012)
Various, EU and
extra EU
Meta-analysis for price
premium of GI
In GI production, agricultural products and
minimally processed foods get the highest price
premiums. Processed GI products sold via longer
supply chains usually use trademarks to gain a
reputation premium. Comparing dierent levels of
GI, PDO products usually receive a higher price
premium, compared to PGI products. When multiple
labelling schemes co-exist (trademarks together with
GI labels) the price premium is lower when the
higher quality is indicated only by a single label.
Herrmann and
Teuber (2012)
Willingness to pay for
origin labels, economic
rationale of GIs
There is low awareness and recognition of the EU GI
system and PDO/PGI logos among consumers. For
wine and high-quality coee, a price premium is
generally obtained. There is no uniform pattern as to
how psychographic and sociodemographic
characteristics of consumers aects their attitudes to
GI products. On the other hand, “clear ethnocentric
behaviour” was highlighted in all studies. GI labels
are more beneficial for producers who do not have a
high reputation for their products.
Deselnicu et al. (2013)
Various, EU and
extra EU
Meta-analysis for price
premium of GI
GI captures the highest price premium for products
sold via a short supply chain or having lower added
value. When other tools for product dierentiating
co-exist (e.g., branding, trademarks), the price
premium is lower, especially for wines and olive oils.
Stricter regulations result in higher price premiums.
Bienenfeld and Roe
Various, EU and
extra EU
Meta-analysis of
willingness to pay,
especially for organic
Based on 132 observations derived from 29 papers,
for organic products, a higher price premium is
realised by fruits and animal products. From a
methodological point of view, studies using
contingent valuation and based on more
representative samples show higher price premiums.
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Table 1. Cont.
Author (Year)
[Reference] Country/Region Issues Reviewed Key Findings
Feldmann and
Hamm (2015)
USA and Europe
Perceptions and
preferences for local
Unlike organic food, local food is not perceived
as expensive.
Consumers are willing to pay a premium for
local food.
Grunert and
Aachmann (2016)
Consumer reactions to
the use of EU quality
The results are conflicting; overall conclusions cannot
be made. Low levels of awareness with significant
country dierences (e.g., higher in South Europe,
lower in the North—in line with the number of the
registered GI products). GI labels can play a role, but
this might be smaller than the role of other quality
attributes (e.g., brand, origin information), and it is
highly dependent on the product and the context.
Evidence on actual perception and use of the labels
in real shopping circumstances is very limited.
Mirna de Lima et al.
Mainly Brazil
Summarising the
findings of GI-related
papers in the Brazilian
CAPES journal
The very general conclusions suggest that GIs can be
designed as a tool for protection (both for consumers
and producers), for marketing (helping in product
dierentiation), for rural development (maintenance
of local employment and identity), and preservation
(culture, ingredients).
Dias and Mendes
Various, EU and
extra EU
Bibliometric analysis of
the various research
topics connected to GI
Based on bibliometric analysis of academic research
(all disciplines) in the field of food quality labels (501
articles), the papers can be sorted into four clusters,
indicating the most relevant research topics.
Leufkens (2018)
[22]EU Meta-analysis on GI
label eects
Consumers have a highly significant and positive
marginal willingness to pay for GIs. However, the
marginal willingness to pay diers significantly
between the individual GI standards and indicates
great heterogeneity between the protected products.
Caputo et al. (2018)
[23]Mainly EU
Consumers’ attitude
towards traditional
food products
European consumers are not familiar with the food
quality labels of the EU. Origin is not the most
important motivation when buying traditional food
products, though it is often seen as an added value.
Cei et al. (2018)
[24]EU Eects of GIs on local
economic development
GIs can generate value-added, especially at
consumer and retailer levels; however, eects on
producers are not apparent.
Deselnicu, et al. undertook a meta-analysis of GI food valuation studies and found that “brands
[trademarks] and GIs may play a similar role in product dierentiation, and thus, be substitutes for each other
], p. 43). Using the same approach, Deselnicu, et al. [
] collected 25 GI valuation studies and
found the GI price premium to be lower when other product dierentiating tools are also available
(e.g., brands/trademarks for processed food products).
Herrmann and Teuber [
] collate a number of WTP studies, finding that origin is valued by
consumers, mainly because of quality and cultural preferences. Bienenfeld [
] provides a meta-analysis
of willingness to pay, especially for organic foods. Feldmann and Hamm [
] reviewed literature
of how consumers react to locally produced foods and found a willingness to pay a price premium.
Grunert and Aachmann [
] reviewed the demand side literature, mainly focusing on publications
about consumers’ reactions to the EU quality labels. Papers about the implications of GIs available in
Elsevier’s Brazil database were meta-analysed by Mirna de Lima, et al. [
]. Dias and Mendes [
prepared a bibliometric analysis of articles using EU GI labels. They found that the most investigated
issues were PGI, olive oil, dairy products (mainly cheese) and chemical composition.
Leufkens [
] tried to quantify and evaluate the overall marginal consumer willingness to
pay for the European GI label. Using a meta-analysis and a heterogeneity analysis, he found that
consumers have substantial willingness to pay for GIs; however, there are significant dierences among
products. Caputo, et al. [
] investigated consumers choices regarding traditional food products. They
highlighted the low level of recognition of the EU quality labels. Also, they collected the main drivers
Sustainability 2020,12, 9434 5 of 24
why consumers seek for traditional products and found that sensory appeal and the natural character,
health and safety issues, origin, ethical concerns, price, and convenience are the most important.
Lastly, their results indicated that it is not clear what are the most important factors of consumers’
decision-making process about such products.
To the best of our knowledge, the last GI-related review was conducted by Cei, et al. [
], with
particular attention given to the economic eects serving rural development initiatives. They concluded
that GIs could generate value-added at the end of the value chains: for consumers and retailers in
particular. However, on the producers’ level, the results are somewhat mixed and depend on the
specific local conditions. A summary of these identified literature review articles is provided in Table 1.
Against this background, the aim of this paper is twofold. First, it updates current knowledge
about GIs, focusing on empirically validated results. Second, it tries to identify the key areas where
policy-makers need to understand when, where and how GIs work best, updating earlier research
conducted by the authors.
To achieve this, the study includes all agricultural and food GI products (also wines and spirits).
However, non-agricultural and food products, together with services, are excluded and are not part of
this research.
After Section 2describing the methodology, Section 3considers the evidences. First general
results from the grey literature are summarised, then the next part with three subsections covers three
dierent topics based on the academic literature: the market size for GI products, the eects of GIs on
net producer income involving the issue of price premiums, and the GI-related tools to enhance rural
development and prosperity. Section 4draws together the results and findings, identifying key gaps in
knowledge and identifying critical areas for policy-oriented research.
2. Materials and Methods
To achieve a wide-ranging overview of the empirical evidences on GIs, a comprehensive literature
review was conducted using five significant online databases: Scopus, Web of Science, JSTOR, ProQuest
and Science Direct. The keywords used were “geographic*” and “indication*”. These two keywords
had to be included in the title, abstract, or keywords. Also, the article had to contain empirical data
and/or analysis. The search was restricted to studies in English or with some information available
in English.
We also included key European Commission reports. Finally, our review was also extended to
the references found in the most important articles identified and these references were also added to
our database.
From the online databases, the initial search resulted in 2881 items. To include only relevant
studies in the final literature analysis and to exclude duplicates, we used the online software package
Covidence. After excluding duplicates, 2144 studies remained that might provide empirical findings
on the topics investigated. Figure 1describes how we screened and identified the relevant literature.
The initial screening, based on title and abstract, was independent, but then the authors discussed items
with conflicting outcomes. This first screening resulted in 1841 items being excluded. The 303 articles
remained were also each screened in more depth by at least two of the authors. Again, authors first
screened independently, but then discussed articles with inconsistent results. Items with willingness to
pay methodology and meta-analysis were excluded; however, we reviewed the papers identified in
these meta-analyses. Also, studies that turned out not to be empirical and where no text was available,
were excluded from our research. The final set of relevant studies employing empirical approach
was 80 publications from the systematic literature review, including 5 studies from the grey literature,
trying to cover all the empirical GI literature published until the end of February 2020.
Sustainability 2020,12, 9434 6 of 24
Figure 1. Pathway of the systematic literature review.
Figure 2indicates the empirical GI studies by their year of publication. There is a clear growing
tendency of such studies in recent years, as more than the third of the publications were published
after 2017.
Figure 2.
Empirical GI studies identified in our study, by year of publication. * Our collection covers
studies available at the end of February 2020.
Sustainability 2020,12, 9434 7 of 24
Figure 3indicates the topics of the articles identified. Obviously, a paper can focus on more than
one topic relevant to this study. The numbers clearly indicate that research on GIs is very much about
trying to measure the economic importance of the sector and the number of papers about impacts on
regional prosperity is quite limited.
Figure 3. Topics covered by empirical GI studies.
Most of the studies investigated Italy, France and Spain, the primary beneficiaries of the EU GI
system. Several extra-EU countries were also often studied, in the Americas in particular (Figure 4).
Figure 4. The territorial focus of empirical GI studies.
Researchers mainly focused on the empirical investigation of GI food products, as 73% of the
papers covered GI food products. Wines and spirits together were the topic of 17% of the papers, while
the rest of them covered various product lines.
Sustainability 2020,12, 9434 8 of 24
3. Results
3.1. Grey Literature and Centralised Datasets
One of the most comprehensive reports is conducted by the London Economics. Undertaken for
the European Commission (EC), this report highlighted “the lack of comprehensive data on the number
of PDO and PGI producers, the size of the agricultural land devoted to PDO/PGI production, the value and
volume of production and the value of sales” and noted that this was “a serious constraint to the monitoring and
evaluation of the scheme at national and EU level” ([25], p. 254).
The authors of the London Economics report suggest that the number of registered GI products
can describe market size. This could however be misleading, as the number of registrations can
be influenced by factors such as national procedures and incentives, country-specific institutional
characteristics, dierent social-cultural contexts, the depth of variety within a particular product group
etc. There will also be substantial dierences between registered GIs in the volume of output, its value
and the number of producers. According to the report, the number of GI products is highest in the
Mediterranean EU Member States, also with significant market for these products. The report also
highlighted the concentration of GI registrations in particular food categories, “Fruit, vegetables and
cereals”, “Cheeses”, “Fresh meat (and oal)”, “Oils and fats/olive oils” and “Meat-Based Products”
represented more than 80% of the total number of registrations. It is clear that GI labelling either works
better or appeals more to producers, in some product lines than in others.
Another major data sources are the contracted reports conducted by AND-International and
published in 2008 and 2019 [
]. These reports analyse all the four GI regimes (agricultural products
and foodstus, wines, aromatised wines and spirits). Both primary (direct and indirect surveys)
and secondary (centralised datasets) data were included, but it is clear that for some areas only educated
guestimates were available. This underlines the problem of the lack of available datasets on GIs again.
Based on the results of the AND-International reports we can assume that the market share of
the GI products (all the four regimes, excluding Traditional Specialty Guaranteed foods) in 2017 was
around 7% with a sales value of EUR 74.76 billion. GI wines had the highest share in the GI market
with 51%, followed by the food products (35%) and spirit drinks (13%), while the market of aromatised
wines was hardly measurable (around 0.1%). Compared to the first report (with latest data of 2010)
the total sales value of the GI products increased by 37% on an average (an increase of 33%, 65% and
27% and among wines, foods and spirits, respectively). This remarkable growth was mainly caused by
the increased number of new GI products; however, the growth of French, Italian and Spanish wines
and French spirits was also determinative. The reports also found extreme concentrations. Among
wines, 90% of the EU28 sales volume and 95% of the EU28 sales value in 2017 came from France, Italy,
Spain, Germany and Portugal. In case of agricultural products and foodstus, PGI products had 58%
share, and only 42% of GI foods sold had a PDO label, while more than half of these GI products
came from only three EU member states (Italy, Germany and France). Among foods, a few product
categories had significant shares: cheeses (36%), meat products (16%), beers (13%), fresh meats (12%)
and fruits, vegetables and cereals (8%) were the five most important categories, altogether representing
85% of the total GI foods. A huge concentration was also identified. For example, out of the 235 GI
cheeses, the Italian, French and Dutch products represented 82% of the total sales value. The GI spirit
market was highly dominated by three products representing 90% of the total market (Scotch Whisky,
Cognac and Irish Whisky). In 2017, the share of GI products exported had reached 42% of the total
sales with 20% of intra-EU markets (e.g., Switzerland) and 22% of extra-EU markets (mostly USA,
China and Singapore). The majority of the exported European GI foods came from France, Italy and
the UK and was pulled by a very few GI products (e.g., Scotch Whisky).
Regarding price premium, the AND reports calculated value premiums, using ex-factory and
wholesale prices, compared to similar products without GIs and weighted by the GI sales volume.
On average, they found 107% value premium for EU GI products, with a slight decrease compared to
the 114% identified for 2010. The authors underlined the importance of French products and wines,
Sustainability 2020,12, 9434 9 of 24
as their contributions to the total value premium is higher than expected. Also, they calculated a higher
value premium for processed products than raw products.
The Aret
report [
] conducted between the two above mentioned AND-International reports,
confirms their general results based on their few selected cases. The authors found remarkable price
premiums for most of their 13 GI case studies, though with extreme variability in the extent. For GI
agricultural raw materials, the price premium was limited but significantly higher for PDO than for
PGI products. They also found that the producers of the final product usually had more than 70% of
total retail value (and also higher gross margins). This also implies that the primary producers’ share
is more limited (though this is almost the same for both GI and non GI value chains) and therefore the
farmers benefit less than retailers from GI labels.
As an initial step of the research we have also inspected the ocial databases of the European
Commission dedicated to the GI system. eAmbrosia [
] is now the ocial register of GI products
recognised by the European Union. However, this online database is limited to technical information
(milestones of the GI products’ registration, product descriptions etc.) and neither empirical nor market
data are provided.
] is the ocial EU statistical database and only collects very basic data on grapes
for wines with geographical indication. According to the latest dataset, in 2016, 72% of total grape
producing area was dedicated to produce grapes allowed for PDO or PGI wine production, representing
1.2% of the total EU utilized agricultural area.
The European Commission’s Farm Accountancy Data Network (FADN) is aimed to measure
the income level of EU agricultural holdings and the impact of the EU Common Agricultural
Policy [
]. In its publicly available dataset there is no centralized data available on the impact of
geographical indications.
3.2. Academic Literature
3.2.1. The Market Size of GI Products
Regarding the academic literature, only a few studies gave quantitative data on the size of the
market. After introducing these few studies, we cover several related aspects: interaction between
price and quantity, export and import, institutional issues, wine related studies and trademarks.
Arfini and Capelli [
] measured concentration in the Italian GI sector, but also explored data on
the size of the market. Although Italy has the most GI registrations (PDO and PGI together) in the EU,
just 15 products generated 90% of the entire Italian PDO turnover. The most important GI products
were cheeses and processed meat products, with substantial dierences in average turnover. In general,
firms producing PGI products had higher values than those producing PDO products. Regarding
market destination, PDO products are mainly sold domestically (86%) and other EU markets (8%),
while the PGI products exported are sold in more distant markets (e.g., 43% olive oils shipped with
PGI labels were sold in extra-EU markets).
Even among well-known GI foods, there are remarkable dierences in terms of the size of the
market and the value chain. E.g., the Italian Parmigiano Reggiano PDO cheese industry processes the
milk from 300,000 farmers (in contrast, the first Brazilian GI cheese Serro is produced only by around
100 dairy farmers [
]) and an annual 3 million wheels of cheese are made by 393 dairies (of which 60%
belong to a cooperative), the Spanish Ternasco de Arag
n PGI fresh lamb meat is produced by many
large cooperative groups but distributed by only three enterprises (of which 66% is a cooperative) [
In 2007, the Portuguese GI food market was estimated to have a EUR 70 million sales value,
dominated by very small producers. Only about two-thirds of GI product was sold in the real market,
the rest being bartered [34].
The real market performance of PDO cheeses in Italy was estimated by Galli, et al. [
who examined 11 varieties in 2008. On average, a PDO cheese in Italy had EUR 50 million turnover
Sustainability 2020,12, 9434 10 of 24
with an average production of 6232 tons. Substantial dierences existed between products, and only
three of the selected varieties exported more than 20% of their total production.
Also, Italian PDO cheese and olive oil was the subject of the ex-post assessment of Carbone,
et al. [
]. Results showed that due to the better connection to the place of origin and therefore reaching
niche market segments, smaller producers had better performance than the bigger ones. On the other
hand, producers with lower-ranked products (based on the authors’ multi-criteria analysis) usually
use conventional distribution channels reaching broader markets with higher volume and turnover.
In Hungary, Jantyik and Török [
] used a mystery shopping approach and found a less than 1%
market share of GI foods in the supply of the most dynamically growing discounters.
It is essential to measure the interaction between price and quantity to get a full picture of the
potential market size. In our systematic literature review, we found only one study measuring price
elasticity. Monier-Dilhan, et al. [
] compared French PDO and non-PDO cheese varieties, using
home scan data from the period of 1998–2003. Based on their results, the level of price elasticity of
PDO cheeses is similar, or even higher than of non-PDO cheese. The authors also suggest little price
substitutability between these products (PDO and non-PDO); however, they were all in possession of
several trademarks, which might also influence reputation.
Several studies focused on the export-related performances of GI products. Leufkens [
] found
that EU GI policy has some impact on trade: PGI has a trade-creating eect in general, while in case of
PDO, only alcoholic products can expect better export performance. On the contrary, the empirical
results suggested that PDO food products and PGI wines instead create trade-diverting eects. Other
empirical results show that GIs play a more significant role in international trade when the importer
has no GI protected product in the same product category [
]. For the European cheese industry,
Balogh and J
mbor [
] found a high level of intra-EU exports, as 80% of the cheese exported by EU
member states are sold in another EU member state. Regarding GI, they found that countries exporting
cheeses with PDO label have a comparative advantage over other countries without GI cheeses.
Belletti, et al. [
] investigated the most exported Tuscan GI products and found that for small
scale producers it could be considered as a marketing tool, however, in general, GI is often used as a
tool for defending the existing market positions. Among the selected products, olive oils were the
most export-oriented. PDO olive oils were targeting the intra-EU markets, while ones with PGI label
were usually exported outside of Europe, mainly to the USA. The results also indicated that exporting
firms with their own trademarks had less interest in PDO or PGI labels.
Török and J
mbor [
] focused on the European ham trade and found that GIs have a trade aect as
exporting countries in possession of PDO/PGI labelled ham had a higher level of comparative advantage.
In Canada, for the cheese market Slade, et al. [
] found that GI-related restrictions might benefit
not only the producers/exporters of the GI labelled products but also local/domestic cheeses without
GI, as additional information on GIs might stimulate consumption for all cheeses.
Only limited research investigates (potential European) GI labelled imports. For Thai GI fruit
and coee products, Wongprawmas, et al. [
] highlighted that the European market is already an
important export destination. Although the Thai government set up their GI system to certify high
quality level, results suggest that these products can expect increasing market positions, but that a GI
label alone would not guarantee success. Another Asian study focused on the GI tropical fruit durian
in Malaysia [
]. Authors found a significant increase in market share; however, due to the small
size of producers and to the lack of an institutional organisation, currently, there is no opportunity of
attracting export markets. Ghana is among the few African countries certified to export honey to the
EU market; however, the export so far is not remarkable. Beekeepers of Ghana, therefore, would like
to follow the example of the Oku White honey, which has received the African PGI label, resulting
in increasing sales and prices, together with exports to the EU [
]. In Chile, neither the national GI
labels nor the public certification trademark is widely used among the producers; therefore they cannot
meet their original expectations to increase market share and to reach export markets [
]. Indian GI
Sustainability 2020,12, 9434 11 of 24
rice Udupi jasmine is entirely sold in the domestic market, and experts think that e-commerce might
strengthen the position of this traditional food outside of the producing region [49].
Several studies focused on GI-related institutional issues. Based on the Spanish beef market Bardaj
et al. [
] found that geographical origin and designation of origin are not among the top priorities for
retailers. However, as their consumers care about these logos, they sell GI labelled products.
The well-known PDO Parma ham (“Prosciutto di Parma”) was the subject of research of Dentoni,
et al. [
]. In-depth interviews indicated remarkable heterogeneity among ham producers, with smaller
producers in favour of strict PDO regulations (in terms of controls and standards). In contrast, large
scale producers—often producing many non-GI products as well—would prefer more flexibility and
would favour of the establishment of a PGI labelled ham. So far, this latter initiative has not happened.
Kizos and Vakoufaris [
] studied the olive oil supply chain of a Greek island. Among small
producers, they recorded a high level of self-consumption (up to 29%). Although Greece has a longer
GI tradition, the vast majority of the olive oil produced in Lesvos Island is sold in bulk, and only a very
small part (less than 1%) marketed with GI labels.
Using value chain analysis, Tregear, et al. [
] inspected the case of a Hungarian onion with a
PDO label. Onion is mainly sold as a raw material; therefore, onion producers need to capture higher
margins and access to bigger markets. They found that market orientation is essential, especially for
small producers. Also, diversification might be another way for higher value-added. In practice, it
would mean cooperation with other sectors (tourism and hospitality, in particular) that might have a
positive impact on the market situation of this product.
Considering the case of the few Baltic GI products, Bardone and Spalv
ena [
] identified a growing
interest in producing and consuming traditional foods in rural tourism in both Latvia and Estonia.
Here these quality labels are part of the rural tourism and preserve cultural heritage.
Corsican clementines have always targeted a niche market, as they could never compete with
Spanish products sold in huge quantities. However, mainly due to the PGI registration of this
clementine only allowed to be sold with leaves (indicating the freshness of the product), shipments
have started growing again after decades of struggling [55].
Many papers investigated the market size of GI wines. Some studies give exact numbers for
specific wine GIs, as wine and vine statistics are usually quite comprehensive in the EU member
states (e.g., in Germany, Mosel GI wines represents the 10% of the total German wine production [
In Brazil, De Mattos Fagundes, et al. [
] found that GI registration can stimulate the market performance
of the producers. In the GI region of Vineyard Valley, the number of wineries has more than doubled
following GI registration.
Agostino and Trivieri [
] investigated the export performance of quality wines produced in
selected regions of France, Italy and Spain. In these countries, the share of the selected wines in the
total wine export is high, and has significantly higher prices, compared to ordinary table wines. Also,
these high-quality wines have higher export values usually sold in rich importer countries (mainly
in Western-Europe and East-Asia). The authors identified dierences as French wines benefit more
from the GI label than do their Italian and Spanish competitors, both in terms of market share and
price level.
The same authors [
] tried to estimate the market performance of Mediterranean wines (PDO,
PGI and non-GI) in the BRICS countries (Brazil, Russia, India, China and South Africa), using a bilateral
export model. Their results showed that PDO wines have a high market value due to the high prices
received mainly by French wines, while PGI wines have only a moderate price premium.
In the case of Tuscan wines, participating in food quality schemes (PDO, PGI, organic) might
increase the number of distribution channels, targeting dierent markets [60].
With a broader context of wines and other alcoholic products, several empirical findings also exist.
Teuber [
] investigated a GI apple wine of Germany, both from the supply and the demand side’s
perspectives. According to the producers, protection against free-riders and imitations, together with
the prevention against price erosion, were the main reasons for the GI registration. From the consumers’
Sustainability 2020,12, 9434 12 of 24
side, the research showed low awareness of the PGI labels, and that consumers tend to pay more for
such GI labelled apple wines as they would like to support the local economy. For fruit spirits distilled
in Central-Europe Török and J
mbor [
] indicated weakening comparative advantages, especially
after the EU accession of these countries after the millennium. Though several Mediterranean GI
spirits (grappa, in particular) are prospering, many of the selected Central-European fruit spirits lost
their European market despite their GI recognition.
Finally, Drivas and Iliopoulos [
] gave specific attention to the interaction between trademarks
and GI labels and found a strong correlation between them. Based on data from 13 European countries,
they found that both are mainly used for dierentiation, particularly when accessing new markets.
3.2.2. The Price Premium of GI Products
Results from studies investigating price premiums of GI foods dier significantly; therefore, it is
essential to keep the location and the product type in mind when interpreting them. First, the attitudes
of European consumers are presented briefly, then value premiums in dierent sectors and value
chains are described. The end of this sub-section is dedicated to coee and wine, where substantial
price premiums are more frequently found for premium products.
Van Ittersum and colleagues, in three studies [
] tested consumers’ preferences for PDO/PGI
products. Based on their findings for 13 protected products from 6 European countries, they found
that consumers interested in local foods are willing to pay a price premium for a GI product. They
also found that low levels of recognition and awareness of these systems among European consumers
limit the added value of GI labels [
]. In 2001, they tried to estimate the direct eect of PDO labels on
regional food preferences for Italian olive oil. They found that region of origin and the PDO label have
dierent influences but mainly for a specific group of consumers. People living in the product’s region
of origin are directly influenced by the region of origin but not by the PDO label itself. Using conjoint
analysis, they found an association between higher price and higher quality, but they did not report
exact measures of price premiums nor of the proportion of consumers willing to pay these. In his PhD
dissertation, van Ittersum [
] summarised his results on GI price premiums saying that consumers’
relative attitudes to regional products significantly influenced the premium they were willing to pay
relative to competing products. Similar findings were found later with a Pan-European study [67].
Santos and Ribeiro [
] investigated the GI market for olive oil and cheese in Portugal. They
calculated a price premium of 22–30% for three olive oil products, while for cheese 12–23% for two of
the four cheeses examined. For the other two cheeses there was no price premium.
Although country of origin labelling (COOL) generally lies beyond the scope of GI policy,
we thought it useful to include one US study that indirectly addresses some GI issues. We did this
because of the lack of data on US consumer attitudes to products with specific geographical attributes.
Carter, et al. [
] report on three US case studies: Vidalia onions, Washington apples and Florida orange
juice. They tried to test the success of COOL as a marketing tool and found no evidence that it leads to
long-term price premiums. They found that in some cases, product dierentiation was not an option
because of the characteristics of the product. To benefit from regional attributes, strong control over
supply and market entry is required, and this is almost impossible to achieve when the production
area is large. Last but not least, they found that advertising and promotion contribute to sales success,
but is often not aordable and sometimes legally prohibited.
Hassan and Monier-Dilhan [
] tried to study competition between dierent types of quality
labels. Using a database about the daily food purchases of 8000 French consumers in 2000, they
studied six products with labels such as organic, PDO, PGI, and Label Rouge and several trademarked
products. They found a price premium for all the products sold with only a quality label (PDO, PGI,
organic or Label Rouge). But if the quality label was accompanied by a trademark it had less value in
all the cases except the dry-cured ham.
Belletti, et al. [
] calculated the eects of certification costs on the value chains of a PGI olive
oil, a PGI beef and a PDO cheese, all from Italy. They found that both the benefits of the GI label
Sustainability 2020,12, 9434 13 of 24
and the associated indirect costs diered between products. Besides the direct costs of certification
and the more expensive inputs, they identified several indirect costs (e.g., adaption of firm structure,
organisation, production process, cost of bureaucracy) and found that these depend highly on how
strict the registered code of practice is. This had the consequence that the profitability of these products
relies on the form of the regulations.
, et al. [
] compared two varieties of beef (PGI and non-PGI) in the Navarra region of
Spain. Based on monthly wholesale beef prices between 1996 and 2006, they found that PGI beef
received a price premium of 7% on average and had better price stability. They also found that the GI
product was better able to withstand crises (e.g., BSE) as consumers’ trust was less aected.
In their guide for geographical indications, Giovannucci et al. [
] included several case studies
from dierent countries. They identified price premiums up to 115–145%, but not all products were
able to achieve any premium. Some generalisations from these studies are that price premiums can
only be achieved over the longer term and that not all specialty products will be able to achieve a price
premium based on GI labelling.
The distribution of value-added among supply chain actors was the focus of a study by Roselli,
et al. [
]. They investigated an Italian PDO olive oil (Terra di Bari) which represented 15% of the
national PDO olive oil market in 2006/2007. By 2009 the Italian olive oil market faced a severe crisis of
falling prices. Terra di Bari oil had a price premium ranging from 10% to 15% compared to non-GI
olive oils, but among all Italian PDO olive oils, it was among the cheaper ones (with prices 39–55%
lower than average). Regarding the distribution of this price premium, they found that within the
value chain, the primary producers (the olive farmers) benefitted least from the PDO certification.
The extra profit gained from the GI went to the bottling companies and distributors. Although olives
suitable for PDO production are more marketable, prices are only slightly higher than for other olives.
For Terra di Bari oil, the price premium is collected at the higher level of the value chain (olive mills,
packers and brokers). The farmers did not seem to gain any financial benefit from the GI.
Penker and Klemen [
] analysed the costs of EU GI registration and maintenance, using the
examples of an Austrian PGI ham and PGI horseradish. They included both direct costs and indirect
costs and tried to link them to indirect benefits such as social capital building, intensified cooperation
with other rural sectors, higher awareness of and compliance with quality standards. They found that
PGI ham, which had a larger output, could aord to subcontract the GI registration process. As a
result, the registration costs could then be financed directly by EU funds. This gives larger groups of
producers a clear advantage over smaller groups both in terms of costs and time required.
Vakoufaris [
] tried to identify the socio-economic and environmental impact of a PDO cheese
produced in Lesvos island, Greece. Comparing a non-PDO cheese that is a close substitute and is made
in the same region by the same producers, they found that the PDO milk producers and cheesemakers
do not receive any premium price. Supermarkets, however, gained a slightly higher price. They also
found that the price of PDO certified milk was often lower than average generic milk prices in Greece.
Iraizoz, et al. [
] tried to estimate the overall profitability and eciency of the PGI beef sector in
Spain. Using the EU’s Farm Accountancy Data Network (FADN) dataset, the results show that PGI
production is more profitable in the Spanish beef sector. Regarding eciency, non-PGI farms have
better technical eciency scores, while the PGI-farms are better in scale eciency.
Some studies have tried to calculate GI price premiums for rice in India and Thailand. For India,
Jena and Grote [
] found that the production of Basmati rice was more profitable than non-Basmati
varieties but less than the production of sugarcane. For Thailand, Ngokkuen and Grote [
] found
that GI producers of Jasmine rice had higher bargaining power than non-GI producers. This potential
impact on prices was found to be due to cooperation between GI producers not to a direct eect of GI
registration. In a comparative study of India and Thailand, Jena, et al. [
] found a positive eect of GI
adoption on the welfare of rice producers, especially in terms of reducing rural poverty. There was,
however, no evidence of any GI impact on consumer prices. This lack of an evident price premium
calls into question the benefits of GI production in these cases.
Sustainability 2020,12, 9434 14 of 24
Though food discounters in Hungary target price-sensitive consumers, the limited number of GI
foods available in their product portfolio is sold with a remarkable price premium, 43% on an average,
compared to their closest substitutes [37].
Investigating online sales of fresh produce on the South-Korean market, Lee, et al. [
] declared
that indicating GI label as an extrinsic product characteristic might positively influence the sales and
the price of the products.
Albayram, et al. [
] studied what determines consumers’ attitudes towards local and/or GI
products in respect of a local and a non-local GI olive oil, both from Turkey. Their results demonstrate
that consumers’ decisions are highly aected both by the quality and by origin. Where both products
are labelled as GI, attributes like brand, package and origin become important. They found that
respondents preferred local to non-local GI products because they considered local GI products better
in terms of both reputation and quality. It was apparent, however, that the higher price paid for the
local GI oil was because it was local not because it was a GI.
For French mountain cheeses (both PDO and PGI varieties) Lamarque and Lambin [
] found
a price premium for the GI producers of the milk used to produce the mountain cheese. The dairy
farmers producing for the PDO cheese gained 41% higher prices, while the PGI milk producers received
only 21%, compared to the non-GI average French farm-gate milk prices.
While there are few systematic studies comparing price premiums for quality products between
dierent food and drink categories, there are a priori reasons for thinking that consumers are willing to
pay a higher premium for wines, and perhaps for coee, than they are for other food products.
Coee is an important product for many small countries, and several have established geographical
indications for their coee, to build a reputation and enter the growing global specialty coee market.
In Honduras Teuber [
] used internet auction data with a hedonic pricing model and regional
dummies. During the first two years, there was no evident impact of the GI label on the price of
Marcala coee. Latin, South-American and Ethiopian coees were studied by Teuber [
] using a
hedonic price model. Data showed that single-origin coees gain price premiums of between 20 and
58%. The results suggested that while the country and region of production is essential, these attributes
are less important than the sensory quality attributes for prices achieved at online coee auctions.
Wines have the biggest GI market world-wide. There is also reason to suppose that consumers
might be willing to pay a higher premium for quality wines than for other agricultural products. It is
therefore worth looking separately at the price premium evidence for wines.
The US wine market was often investigated in terms of origin. Bombrun and Sumner [
] analysed
the price determinants of wines in California between 1989 and 2000. Of the 125 dierent appellations,
they found that 64 had significant price influencing power. For instance, the well-known Napa
Valley wines had an average +61% price premium because of the appellation, compared to standard
“California” wines. Costanigro, et al. [
] also tried to estimate the link between the name (origin),
reputation and price premiums for California wines. Based on a dataset of 9,261 observations from
Wine Spectator between 1992 and 2003 they found that for more expensive wines, the specific names
and labels are more valuable than for the cheaper ones. All wines also benefit from collective names.
Schamel [
] investigated relative prices in the US market for wines produced both in and outside
the USA to determine the value of the producer brands/trademarks and geographical indications.
The results identified origin as important. On average top quality wines from New World producers
outside the USA never exceeded the prices of average quality wines from the Napa Valley. On the
other hand, the top brands from France or Italy had higher prices than the top US brands. This
was interpreted as meaning that Old World wines still possessed a higher regional reputation in the
US market.
In their study of the Portuguese GI market, Santos and Ribeiro [
] include not only wines but
also olive oil and cheese. Using a sample collected from three dierent types of retailers, and hedonic
price function estimation, they found a statistically significant price premium of between 26% and 46%
Sustainability 2020,12, 9434 15 of 24
for three of the six wines. In respect of the other three wines, they found price premiums of 1–14%,
but these results were not statistically significant.
In both of their papers, Agostino and Trivieri [
] analysed the price and volume eects of GI
labelling for wines from France, Italy and Spain. They found that in rich importing countries, all three
origins have a value premium, caused by both price and volume eects. The price premium was
highest for French wines and somewhat lower for Italy and Spain. Similar outcomes are reported for
the BRICS markets, indicating that the GI price premium exists not only in rich but also in emerging
markets. In the latter study, the French PDO premiums remain the largest, and significantly higher
than the Italian and Spanish premiums. Finally, using historical data for selected French wines, Haeck,
et al. [87] found that GIs have a determining role on prices of some Champagne wines; however, this
was not the case for wines from Bordeaux or Champagne.
3.2.3. The Impact of GI Products on Rural Development
One of the initial goals of EU GI policy is to promote regional prosperity by improving farmers’
income and retaining rural population in less-favored or more remote areas [
]. Many studies state
that, for lower-income countries, GI policy has been promoted as an important avenue for raising
producer incomes and to promote rural socio-economic development e.g., [
]. In this
sub-section, we review the empirical results from studies that considered the impact of GI products on
regional prosperity.
Most of the studies we found were case studies with little hard data. They focused on issues such
as institutional arrangements and how dierences in these aected the likelihood of any increased
income remaining in the original product area.
Through a case study of three Tuscan products (PGI olive oil, PGI beef and PDO sheep cheese)
Belletti, Burgassi, Marescotti and Scaramuzzi [
] tried to identify the possible eects of GI products
on rural development. They highlighted that the most crucial goal is to attach any higher GI income to
the GI producing area, rather than further down the value chain. A critical issue is, therefore, what is
the direct impact on the income level of the GI farmers and the indirect eect on local employment.
Additional regional benefits can be gained by attracting consumers to the producing area so that there
are positive spill-over eects from other actors in the local system. In this way, the production of GI
foods can interact positively with tourism and handicraft production. They also point to positive
non-economic eects from the presence of a GI supply chain, such as maintaining traditional production
methods and encouraging social interaction. Based on the example of other well-known Italian and
Spanish GI product Arfini et al. [
] highlighted the level of externalities associated with public
goods. In case of the Parmigiano Reggiano PDO cheese and Ternasco de Arag
n PGI lamb meat,
these public goods can be identified not only at the value chain level but also at the territorial level.
Cei, et al.
] tried to assess the eects of GIs in Italy on the NUTS3 level. They found that a higher
number of GI schemes causes a higher level of value-added, thus possibly it fosters rural development
in these regions.
Tregear, et al. [
] took a multi-country approach, looking at two Italian (fresh fruit and processed
meat) and one British (cheese) product. They examined the role that regional food qualification schemes
play in rural development. They found that when local institutions try to involve too many actors
in developing the GI regulations, there is a risk of losing the distinctive local characteristic. This is
because accommodating many actors with dierent expectations results in too permissive code of
practice. Where this happens, there is a looser connection between the GI product and the region of
origin. Overall, they concluded that policies such as GIs need to be considered as part of an extended
territorial strategy. The success of the GI element depends on a mix of actors and motivations.
Williams and Penker [
] conducted 25 in-depth interviews with large retailers and stakeholders
directly involved in producing and or marketing Jersey Royal and Welsh Lamb. The study identified
only indirect impacts on rural development, finding outcomes such as increased transparency and
fairness due to GI regulations.
Sustainability 2020,12, 9434 16 of 24
Tequila is a Mexican GI first registered in 1974 and is not only the oldest Mexican GI but also
perhaps the most well-known non-European GI. Issues related to the product description were
investigated by Bowen and Zapata [
], using several rounds of semi-structured interviews with agave
farmers, tequila producers and distributors, government ocials, and leaders of farmer associations.
The authors found that the sole production requirement was geographic boundaries. They found
that because the boundaries covered a very large area, including territories without any tradition
and without the required biophysical conditions for cultivating agave, over time the link between the
production locality and quality has been eroded. The GI was not recognised in the USA and Canada
until 1994, and not until 1997 in the EU. Since then demand for tequila has grown, and traditional
agave cultivation and artisanal tequila production has been replaced by modern, industrialised
techniques operated by large (international) companies which have entered the market. The expansion
of the tequila market thus resulted in a substantial shift in control and ownership, accompanied by
concentration, industrialisation, and standardisation. Local actors have lost their influence on tequila
production, resulting in economic insecurity among farm households dependent on agave production.
In their multi-criteria analysis of 11 dierent Italian PDO cheeses, Galli et al. [
] also looked at
rural development issues. In assessing rural development, they considered factors like the share of
production sold on local and regional markets and the presence of local events for the promotion of
PDO products. They found that products with good market performance such as Pecorino Romano
and Gorgonzola had high exports and increasing market share. But this was associated with a low
contribution to rural development (and also low bargaining power and limited product dierentiation).
In contrast, small PDO producers of Robiola di Roccaverano, Murazzano and Raschera, with strong
production traditions it had much better outcomes in terms of their contribution to rural development.
By analysing the value chain of GI olive oil in Lesvos island, Kizos and Vakoufaris [
] highlighted
that a GI label could help smaller producers achieve higher incomes as they have relatively more
freedom in choosing between supply chains. On the other hand, large bottlers have to cooperate and
satisfy international retailers, so for them, the GI label does not necessarily lead to economic success.
As a consequence, there is less association between large bottlers and regional prosperity.
Similar to the case of tequila, Bowen and De Master [
] found that how a GI system was
introduced could be harmful to heritage-based food systems. With their comparative fieldwork in
France and Poland, they investigated several cheeses (Corsican cheese and Comt
from France, Oscypek
cheese from Poland) and the multifunctional quality initiatives in the Polish Narew River region. Their
most significant finding was that by pursuing extra-local markets, the production processes changed
and started losing their former characteristics of regional distinctiveness. They found dierences
between the three cheese cases. For Comt
, heritage and tradition were integrated into a code of
practice that benefited small scale local producers. For the other two cheeses, they found that extra-local
actors played a larger role. This led to the introduction of so-called “invented traditions” designed to
maximise commercial profit—but these were not part of the local production system. Overall, they
suggest that GI initiatives can be a good tool for rural development provided special attention is given
to the social-organisational context when setting up the code of practices.
Another comparative study tried to assess the role of institutional policies supporting quality food
labels using the example of a Mexican sausage (without GI) and the Spanish Iberian Ham (in possession
of several PDO labels) [
]. The authors found that that dierences in geopolitical context resulted
in disadvantages for the Mexican sausage as they could not achieve the GI recognition. In contrast,
the Iberian Ham, supported by the EU GI policy, has reached substantial development, as the PDO
ham producers became very successful in terms of entrepreneurial vision, capacity building in local
actors, heritage preservation and self-employment
A positive correlation between GIs and regional prosperity was identified by Ngokkuen and
Grote [
]. They analysed the impact of GI adoption on household welfare and poverty reduction
among Jasmine rice producers in North-East Thailand. Based on a cross-sectional survey with 541
Jasmine rice producer families (180 GI certified farms and 361 non-GI farms), they found a significant
Sustainability 2020,12, 9434 17 of 24
and positive eect of GI certification adoption on household welfare and poverty reduction. They
found GI producers to have significantly higher consumption expenditures (both annual and monthly)
and a lower incidence of poverty (using national and regional poverty lines). GI farmers also owned
considerably more land, productive assets and vehicles. The education level of the household head was
higher, and GI farmers generally had more social capital (were a member of cooperatives, participated
in village meetings, accessed information on GIs and followed good agricultural practices). However,
the authors highlighted a major limitation of their research—that as the adoption of GI certification
was endogenous. The dierent outcomes for GI and non-GI farmers could not be interpreted as caused
by the adoptions of GI processes. Despite this, they argued that the positive household prosperity
outcome was a pure eect of the GI certification adoption. Similar results were found for India: Jena
and Grote [77] found that the adoption of Basmati rice had increased household welfare.
In the case of the Malaysian fruit durian, the GI helped to build up its own terroir and to preserve
agro-diversity together with local identity. These were also helpful in promoting a touristic brand for
durian orchard owners [
]. Similar results were found in Latvia and Estonia, where the local GI foods
are part of rural tourism. Therefore, the EU quality labels help in the promotion and the preservation
of these cultural heritages [
]. In Croatia, the existence of olive oils with protected geographical
indications enables additional recognition of the olive oil producing region; thus, GIs can heavily
contribute to the olive tourism developments [95].
For Indonesian GI coee Neilson, et al. [
] found only a little evidence that current GI schemes of
Indonesia have tangible economic benefits for the producers and the producing region. This is mainly
due to the lack of supportive local institutional settings on a strategic level. However, some intangible
benefits can be identified, mainly the promotion of the sense of regional pride and cultural identity,
but this hardly results in achieving rural development outcomes.
A case study of the Nicaraguan GI cheese Queso Chontaleno highlights problems that are common
in many developing countries [
]. The introduction of the Queso Chontaleno GI also meant more
competitive pressure on the local production system. In South America, the introduction of such GIs
has often been found to benefit mostly the local elite and not farmers or cheese producers. In the
Queso Chontaleno case, international organisations assisted with the GI registration, but traditional
producers were not really involved, so the code of practice did not reflect their interests. For example,
there were no provisions for institutionalising the link between product and terroir. Mancini suggests
that for a GI to contribute positively to regional prosperity, three factors are essential. First, it is crucial
to set up proper quality standards to define the method of production. Second, it should be clearly
stated how the GI valorises the producing area (the terroir). Third, there should be a strong collective
organisation to foster cohesion among GI producers.
The case of the Brazilian cheese Serro with an indication of provenance also showed that the
recognition of a GI might stimulate territorial development goals; however, it has many limitations
in several aspects and results heavily depend on other factors. GI is most of all a tool for territorial
development that can encourage cooperation between actors in rural areas [32].
In Japan, among GI farms producing Tonburi, Tashiro, et al. [
] dierentiated the eects based on
their time horizon. In the short term, GI registration might contribute to the spread of cultural capital
among farmers; however, over a long term, GI and the associated traditional ecological knowledge
negatively aects production maintenance and landscape management.
Lamarque and Lambin [
] investigated what GIs can do for the prosperity of marginal mountain
areas in France. They compared a PDO, a PGI and a non-GI cheese using farm surveys. Their results
showed that high standards for the GI cheeses are associated with more extensive agricultural practices,
especially in the case of PDO farmers, though the dierences between PDO and PGI farmers are
minor. In this way, the GI schemes can indirectly contribute to retaining population in these regions,
as extensive agricultural practices are more labour-intensive.
Based on the case of Hungarian PDO onions Tregear et al. [
] found that the impact of such a
nascent GI on the prosperity of the producing area is very limited. To meet regional development
Sustainability 2020,12, 9434 18 of 24
expectations, the building of eective networks with regional actors external to the value chain (outside
of onion production and distribution) is crucial. Although the onion is deeply embedded in the local
culture (e.g., onion themed attractions like onion themed spa and cultural centre) and this PDO variety
is well known in Hungary, the PDO onion struggles to become the basis for a “basket of goods” rural
development strategy. The reputation of this product is appreciated only locally and in Hungary.
4. Discussion
Our research highlights the fact that there is only very limited relevant empirical economic data
available on the impact of GI policy. In the EU this lack is particularly evident. A major reason is
that the EC has not yet set up any comprehensive dataset to evaluate and improve GI policy—so far,
there is no EU-wide data collection about the production and the markets of PDO and PGI products.
The available ocial database eAmbrosia (integrating the former DOOR, E-BACCHUS and E-SPIRIT
DRINKS databases) is a simple registration database with no economic data. In the EU, the FADN
system collects accountancy microdata on agricultural holdings reporting harmonised information at
three levels: region, economic size and type of farming. However, the design of the data collection does
not eectively measure the impacts of GI production. The centralised EU FADN dataset is a summary
of the results of national surveys that are not entirely the same, and only a few (e.g., the Italian and
Hungarian) collect data on GIs, mainly about whether the selected farm is producing any GI product.
In some of the Mediterranean EU countries, with the most significant GI production, specific initiatives
exist to gather national market data (e.g., the Italian Qualivita). However, on the whole, we can
conclude that there is a lack of statistics on the EU GI sector, even though other European food quality
schemes (organic production, in particular) are supported with centralised data collection and through
EUROSTAT (the EC’s Directorate-General providing statistical information) easily accessible datasets
are available.
The most fundamental issue is how large the market for GI foods might actually be. This, of course,
depends critically on the consumers’ willingness to pay for these (higher quality) goods. Due to
methodological problems and lack of systematic data, we did not include WTP studies in this particular
review. But the available data do show that the most important GI market is the internal market of the
EU. Nonetheless, despite the well-known European commitment to food quality, GI labelled products
form only a minor part of total EU agri-food production (7% in 2017). There are a few GI products
with both significant market size (domestic and export) and remarkable market share, but these are
a small set of all registered GI products and are concentrated in only a few countries, mainly in the
Mediterranean EU countries.
What the limited available studies so show is that there is considerable heterogeneity between
dierent GI products and between the outcomes for similar GI products in dierent regions.
Consequently, it is dicult to determine if there are specific types of product, or specific places,
where GI labelling is more likely to achieve a price premium. This hinders the eective development
of GI policy on the ground. Based on the available data it is not possible to recommend where an
investment in GI labelling will generate a good return. Certainly, many wines achieve premiums
related to quality. But there is as yet no clear evidence as to whether the higher premiums observed for
wines translate across to foods. There are suggestions that regional coees can obtain good premiums,
but there are many cases where eorts to achieve such premiums by using GI labelling for a coee has
not (or at least not yet) been successful. There are also suggestions that a small number of meats and
cheeses with global distribution chains, may also achieve valuable premiums.
If one cannot know when a GI label will achieve a higher price for a product, how can one know
the impact of GI labelling policy on farmer prosperity? The studies available do show that farmers can
achieve higher prices—but they also show that this is not a certainty. They show that there are higher
costs associated with producing GI products—intrinsic costs in producing a higher quality product
and indirect costs associated with complying with the GI regulation. But the empirical studies that
address the issue of the impact of GIs on net producer income are insucient to say when, where and
Sustainability 2020,12, 9434 19 of 24
how this might occur. One issue they do point to, however, is that it cannot be assumed that any higher
net income will flow to primary producers rather than to actors higher up the value chain.
The studies we have found point to a possible pattern where PDOs usually gain higher price
premiums than PGIs and products with higher value-added also generally gain higher premiums.
There were, however, exceptions to this pattern. It was also reported that when dierent quality labels
are attached to a given product (especially a GI label and a trademark), the value of the GI label can be
low as consumers prefer and/or are more aware of other quality cues.
Given the lack of clear data on market size, price premium and impact on net producer income,
it is not surprising that the material on the role of GIs in regional development is thin when it comes
to hard data. Obviously, some criteria need to be met if GIs are to contribute positively to regional
prosperity: there must be higher net producer income, and this must attach to the farmers or processors
located nearby.
Also, there are other mechanisms that could enhance any positive regional development impact
of GIs. One of the most important indirect impacts can be on regional employment. If the labour
needed for a GI product is significant—as it can be for traditional and labour-intensive production
methods—then a GI can make a positive contribution to regional prosperity. However, care needs
to be taken that this does not simply perpetuate low wages associated with traditional agricultural
methods. Employment generation needs to be accompanied by reasonable incomes.
Positive spill-over eects from other actors in the local system can also be important, for example,
where there are synergies between GI food production, tourism and even handicraft production.
In many regions, a particular regional brand is used across a range of product types and indeed across
industry sectors. How regional branding inter-relates with GI labelling needs more study.
On the other hand, as several papers found, attempting to increase local income by accessing
extra-local markets can result in negative eects on regional prosperity. One conclusion is that great
care needs to be taken in designing and implementing a GI strategy for a product. The GI code of
practice can play an important role via identifying the right geographical boundaries and practices to
ensure a vital connection between the product and the production area. To turn the yields from GIs
into regional prosperity requires consideration of all these factors.
Author Contributions:
.T. and H.V.J.M.; methodology,
.T. and H.V.J.M.; software
and H.V.J.M.; formal analysis,
.T., L.J., Z.M.M. and H.V.J.M.; investigation,
.T., L.J., Z.M.M. and H.V.J.M.;
writing—original draft preparation,
.T. and H.V.J.M.; writing—review and editing,
.T., L.J., Z.M.M.and H.V.J.M.;
.T., L.J., Z.M.M. and H.V.J.M.; supervision,
.T. and H.V.J.M.; funding acquisition,
.T. and H.V.J.M.
All authors have read and agreed to the published version of the manuscript.
This paper was supported by the J
nos Bolyai Research Scholarship and by the National Research,
Development and Innovation Oce project FK124800 “Economical and Social Impacts of Food Quality Schemes
and Short Food Supply Chains in Hungary”. The initial stage of the research was conducted by
ron Török and
Hazel Moir at the Australian National University Centre for European Studies and supported by the Jean Monnet
program of the European Commission.
Conflicts of Interest: The authors declare no conflict of interest.
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... GI also enable market differentiation for the local product. GI allows the product to be marketed in broader markets because it is also in demand outside the production place (12). This feature contributes significantly to tourism revenues (13). ...
... There is a growing literature on the country of origin products and consumers' WTP for such products (6)(7)(8)(9)(10)(11)(12)(13)(14)(15)(16)(17)(20)(21)(22)(23)(24)28,29,(31)(32)(33)35,43,45,(49)(50)(51)53), In the same line, the literature on GI is developing in Turkey (5,(25)(26)(27)30,(36)(37)(38)(39)(40)(41)(42)44,46). Current research primarily focuses on consumers' perception of GI products, GI products' effect on rural development (9,24), rural tourism (12,(25)(26) and gastronomy tourism (27,28). ...
... There is a growing literature on the country of origin products and consumers' WTP for such products (6)(7)(8)(9)(10)(11)(12)(13)(14)(15)(16)(17)(20)(21)(22)(23)(24)28,29,(31)(32)(33)35,43,45,(49)(50)(51)53), In the same line, the literature on GI is developing in Turkey (5,(25)(26)(27)30,(36)(37)(38)(39)(40)(41)(42)44,46). Current research primarily focuses on consumers' perception of GI products, GI products' effect on rural development (9,24), rural tourism (12,(25)(26) and gastronomy tourism (27,28). A small number of studies have evaluated GI products within the scope of destination marketing (25), branding (28), value creation (29) and export marketing (12). ...
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Background and aim: A geographical indication (GI) confirms the products' geographical origin. GI products derive their quality and reputation from this origin. Protected Designation of Origin (PDO) labelling guarantees that the product is produced, processed and prepared in a specific geographical area. PDO labelling helps sustain the product's naturalness and quality by preserving local identity and culture. Therefore, consumers are willing to pay (WTP) more for such products. PDO labelling elevates brand building and supports rural tourism and rural development. Olive producers can reach a high-profit margin by obtaining PDO labels. Despite the benefits, PDO labelling offers PDO-labelled table olive consumption below desired levels. This shows that consumers still need to understand PDO labelling fully. This research aims to reveal consumers' GI knowledge of the Gemlik table olive and how their knowledge affects consumption levels and WTP. Methods: Data was collected from 648 residents in Bursa, Turkey using a public-intercept survey. The study used descriptive analysis and used SPSS 22 software package to analyse the data. Results: The result showed that 59.6% of participants were knowledgeable about GIs, and 56.3% were knowledgeable about PDO labelled Gemlik olive. Only 37.5% of respondents consumed PDO labelled food products, and 32.7% consumed PDO labelled Gemlik olive. Over half (51.4%) of the participants see themselves as average, 31.8% moderately, and 16.8% very knowledgeable about olives. While 79% of the consumers indicated WTP for the PDO label, half could pay 10% or less. The proportion of those who said they could spend more than 25% remained at 11%. Conclusion: Consumers are willing to pay more for PDO labelled Gemlik olives as their knowledge increases.
... GI research suffers from a lack of comprehensive and readily available data (Török et al. 2020). One of our major contributions is that we base our analysis on a large number of observations and GIs from the Open Food Facts database. ...
... It is difficult to make general conclusions in GI research due to the heterogeneity of registered products (Török et al. 2020). We focus on 79 cheeses and prepared meats from 10 countries not only because many GIs fall in these categories, but also because additives are common in these categories. ...
... Overall, PGIs do not show a significant difference concerning ultraprocessing and additive use compared to non-GI products. Hence, the general heterogeneity of GI products (Török et al. 2020) also reflects itself in our differing results regarding PDOs and PGIs. ...
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The EU's “Farm to Fork” strategy aims to promote healthier diets that include more nutritious and natural foods instead of ultra-processed products. Although several producers of geographical indication (GI) foods such as Parma ham advertise their products as artisanal and healthy, little is known yet about whether GIs can contribute to these ambitions. Therefore, we examine the nutritional quality and food composition of GIs compared to non-GIs. We analyse more than 6,000 cheeses and prepared meats marketed in France. We find that in these food categories GIs are associated with lower nutritional quality based on the Nutri-Score metric. Thus, GI regulations may need to facilitate health-driven product reformulations. On the positive side, we find that GIs in the considered dairy and meat categories tend to be less likely to contain food additives and to be ultra-processed. However, this seems to be truer for Protected Designations of Origin than Protected Geographical Indications. Hence, harmonised additive rules could strengthen the natural character of GIs.
... Agricultural and Food Economics (2023) 11:33 the European food and drink sector (European Commission 2021) and processed meat products are a distinct product group of European GIs (Török and Moir 2018). Moreover, among the GI foods on the EU register, meat products are present in the second largest proportion (after cheeses) and are associated with one of the highest price premiums Török et al. 2020). ...
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Processed meat products are a staple part of the typical European diet. Product packaging can include a considerable amount of information and, with other intrinsic and extrinsic attributes, substantially influence consumers' preferences and purchasing decisions. This study investigates 14 product attributes of processed meat products using a cross-country analysis. Based on an online survey conducted in Hungary ( n = 410), Italy ( n = 268), and Serbia ( n = 402), an object-case best–worst scaling approach was applied. Results reveal both international and country-specific characteristics of preferences. Best-Worst scores reveal that taste and best-before date are among the most significant considerations in all three countries, while brand is among the attributes considered least important. Comparisons indicate significant differences according to country and socioeconomic characteristics. The study provides managerial implications.
... Actually, analysing the main conditions that favour GI registration is complex, due to limited availability of economic data on GIs at the local level. Because of these limitations, previous studies addressing this nexus were mostly qualitative (see, for example, Torok et al., 2020;Bonanno et al., 2019). However, they all confirm that socio-economic determinants (e.g., infrastructure endowment and consumer demand), dynamism of the local agri-food sector, and favourable institutional context all matter (Huysmans and Swinnen, 2019;Meloni and Swinnen, 2018;Vaquero-Piñeiro, 2021;Resce and Vaquero-Piñeiro, 2022). ...
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Remote areas have been progressively obtained greater attention within rural development policies. Actually, a tool to foster the economic development of remote areas is valorising those high-quality agri-food products that are characterised by unique features through the use of Geographical Indications. In particular, socioeconomic characteristics and weaknesses might limit GI implementation, especially in remote areas. This work addresses this topic, by considering as a case study Southern Italian regions and their remote areas, as defined by the 2014 Italian National Strategy for Inner Areas. The work considers data on GIs at municipality (i.e., LAU2) level, adopting an empirical strategy based on the hurdle model for count data. Results suggest that geography plays a key role: actually, municipalities in the inner areas show a lower number of GIs compared to non-inner municipalities. Moreover, also social capital seems to play a role, stressing its importance when dealing with the registration of a new GI.
... A study concluded in investigating the factors of geographic indicators which are already registered, the respondents of the research study stated that they took too much time in getting the GIs registered; there were so many formalities included, including the verification process, form filing, signatories and other time to the authorization was quite a time taking (Török, Jantyik, & Maró, 2020). Further, in recommendations, it has been said that an easy process of registration should be introduced (Ariestyani & Utami, 2022). ...
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Geographical Indications (GI) are signs or tags that are used on agricultural, manufactured and natural goods in order to distinguish and protect them. The protection of such GI’s gives owners and cultivators due recognition in the world, and the buyers become aware of the original product belonging to a specific area. Pakistan enacted its GI law in 2020, and despite great potential, there have still been a very minute number of GI registrations. Pakistan is a diverse country rich in culture, values, and identities. There are numerous potential Geographical indications that have not been registered in the country due to various impediments in the processes of its registration. In order to register Geographical Indications in Pakistan, there are several barriers that must be overcome, including lack of knowledge, lack of technology, lack of a connection between IP tribunals and the business community, a dearth of subject-matter specialists, etc. Pakistani gemstones, fruits, delicacies, footwear, sports products, cutlery, sweets, traditional outfits and headgear are thought to be registered as strong GI's in the nation. These potential Geographical Indications, if registered, could earn a great amount of money for the national exchequer and improve the dilapidated financial condition of the country.
This chapter considers a specific issue of the impact of the European Union (‘EU’)’s Free Trade Agreements (‘FTAs’) on third countries, with a focus on geographical indications (‘GIs’). It assesses the hypothesis of the crowd-out effect—when an EU GI-protected product listed in the EU FTAs is the same as product names exported from athird country, the EU producer will exclude third-country exporters from using the same name. The chapter first explains the conditions and limitations of the crowd-out effect, then uses EU-South Korea FTA’s GI list which includes 19 cheese names to examine to what extent the crowd-out effect exists in a real world case. It concludes with key findings, future research directions, and the need for a systematic solution to the crowd-out effect.KeywordsGeographical indicationsFTATRIPSCrowd-out effectNorm collisionsMFN
In discussions about the development of regions, normally only economic factors are related, however, the new demands imply the need to promote sustainable development through synergy between sectors. This article presents a systematic review about Geographical Indications - GIs, with the objective of verifying their contributions in promoting the Sustainable Development Goals - SDGs, highlighting SDG number 8. Thus, 58 articles published on the Mendeley platform were selected. It is understood that the territorial insertion of the GIs represents the valorization and protection of the activities of the place, presenting economic, social, environmental progress and the valorization of the cultural heritage. However, its main obstacle lies in the formulation of a public policy capable of meeting the particularities of each product.
The boundaries of geographical indication (GI) areas represent the core of GI specifications. Theory suggests that smaller areas result in higher prices due to quantity restrictions and higher quality. However, empirical evidence on the importance of GI areas for using places as brands is scarce. Our regressions using newly coded data of GI areas in km² of 22 hams provide direct empirical evidence that larger areas are associated with lower prices. Subsample regressions suggest that areas affect prices through both quantity and (perceived) quality. Thus, our findings indicate that GI areas are a non-negligible factor in establishing collective regional brands.
Geographical Indications (GIs) have been a ‘must-have’ element for EU FTAs in the last decade. Contemporaneously, the USA has contested these EU GI provisions in its own FTAs often with the same countries. The impacts of the EU-US contestation on GIs on a third country are not sufficiently understood. China has been a long-standing example of the EU-US GI contestation. This article examines how the competing demands of EU-US GI contestation have contributed to the ‘Chinese GI Schizophrenia’, which features triplicate GI protection mechanisms coexisting simultaneously and independently. It discusses how the symptom has developed when China was navigating GI regulations bilaterally and multilaterally in the last four decades, how China has made efforts to manage this schizophrenia through institutional integration, and how recent agreements with the EU and the USA respectively further worsened the situation. Using the case of Chinese GI Schizophrenia, this article warns of similar consequences for any country signing bilateral GI agreements with both the EU and the USA: a compliance dilemma that can ultimately cast doubts on the legitimacy of GI rules and create rule complexity that can bring enormous uncertainty to agri - food producers and exporters.
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The protection of geographical indications (GIs) is an important feature of modern trade agreements. In the Canada‐European Union Comprehensive Economic and Trade Agreement (CETA), Canada agreed to stronger protections for GIs of European cheeses and other food products. Under this agreement, new Canadian producers can no longer label cheese as “feta” but instead must refer to it as “imitation feta,” “feta style,” or “feta type.” We use a choice experiment to determine the effect of this agreement on Canadian cheese producers. We find that the effect of GI recognition varies depending on the terms used to label Canadian cheese and the information given to consumers. The results imply that policies that give greater latitude to food marketers will weaken the impact of GI recognition.
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The food security of the European Union heavily relies on the food quality systems where Geographical Indications (GI) play an important role. European food is considered world-wide secure and high quality, therefore European food names and designations represent value that should be protected as intellectual property. Despite the importance of GIs in Europe, the availability of the related economic data is very limited, and the only available comprehensive database (in the case of GI foods, the Database of Origin and Registration (DOOR)) details only some very basic and mainly administrative characteristics of such products. From an economic perspective, market size and price premium of these products are the most important in order to assess the economic sustainability of European GI foods. Empirical datasets describing these characteristics of GI products are scarcely available and can be collected only case by case. Therefore, the purpose of this study is to estimate the market size for food products with geographical indications available in Hungary (excluding wines and spirits) and their price premium compared to their direct substitute products, based on empirical data. We conducted monthly mystery shopping for one year (January–December 2018) at three food discount stores (Lidl, Aldi, and Penny Market) operating in Budapest. We collected data on all the GI products available in the stores and their closest substitutes; then the dataset was subsequently analysed and compared to the main characteristics of the DOOR database. The reason for choosing the discounters is that these stores have expanded spectacularly in recent years and are mostly available to average consumers, both in Hungary and across Europe, and based on the main characteristics of this type of retail (limited product portfolio targeting price-sensitive consumers), the data collected here can be considered to indicate the minimum level of market share and price premium. Our results show that currently, GIs have only limited importance in the Hungarian food market, in terms of both the number of products and their market share, as only a small number of such products appear in the food discounters’ supply. As regards the premium achievable with consumer prices, the average price premium is remarkably high (43% on average), even in the case of discounters. Our empirical results also suggest that in Hungary, there is an opportunity to increase the importance of GI foods, both in terms of availability and market share. For Hungarian GI food producers and processors, the level of price premium achievable in discounters might be attractive enough to stimulate their presence in the market.
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Purpose – The aim of this paper is to identify necessary requirements for development of olive tourism and compare the findings with the situation in Croatia in order to provide guidelines for the future development of this particular form of tourism. Design/methodology/approach – In this preliminary study, the method of secondary sources data analysis was used. The data includes searching of relevant scientific articles and official web sites such as web pages of the Ministry of Agriculture, Tourist Boards, etc. Findings –The analysis revealed the existence of eight requirements necessary for olive tourism developments, such as: oil mills open for visitors, museums and interpretation centers dedicated to olives and olive oil, olive farms, protected geographical indications, olive groves, events/fairs devoted to olives and olive oil, Olive Oil Roads, specialized shops for olive oil – oleotece. The results could help in future research for planning and development of olive tourism in other countries. Olive tourism requirements already exist in Croatia, but there is insufficient available information about stakeholders who offer activities related to olive tourism. Originality of the research – This study has identified necessary requirements for olive tourism development. It is oriented to olive tourism in developing countries, which have received little prior research attention.
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The tropical fruit durian in Southeast and East Asia has witnessed a surge in popularity in the past two decades to assume the rank of a fetishized commodity. This research investigates the construction of the multidimensional concept of terroir as applied to the durian economy of Penang, Malaysia based on personal interviews with orchard owners and state government officials to strategically embed the local in the global through the promotion of agritourism. While environmental terroir is a contingent dimension, the construction of a place bound cultural terror is anchored in a strong cultivation tradition, cultivar diversity, and a historical sense of community. This research deepens the cultural terroir dimension in two ways. First, it injects the otherwise aspatial concept of refinement to the cultural terroir narratives of orchard owners allowing the on-farm tourist consumption experience to be more geographically rooted. Second, it conceptually links cultural terroir to the marketing terroir instrument of the Balik Pulau geographical indication; while functioning as a governance tool to prevent fraud and to construct a place bound product valorization and differentiation within an expanding and larger scale durian economy, it also indirectly assists in preserving agro-diversity and local identity.
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Fresh produce has rich sensory attributes, and consumers generally prefer examining physically these sensory attributes prior to purchase. The nature of e-commerce, however, limits consumers’ ability to examine products’ sensory attributes while buying online. Customers receive very limited intrinsic cues of fresh produce (such as color) when buying online and thus use only extrinsic cues to assess the quality of fresh produce. This study investigates the effects of extrinsic cues on online shopping for fresh produce, with a particular focus on the effect of geographical indication (GI), which often assumes the role of brand names among producers of fresh groceries. We used data from an online South Korean marketplace for fresh produce to conduct a linear regression analysis. The results show that products linked to GIs sold more and were ordered more frequently; other control variables had somewhat significant effects. The volume of online product reviews was found to have a significant positive effect on the amount of orders and sales, but the product rating itself did not have an effect. The price had a negative effect on the amount of orders, while the number of certifications ( e.g. “organic agriculture”) had a significant positive effect on the number of orders.
This article reviews the scientific literature on local food from the consumer's perspective and analyses findings through the application of the Alphabet Theory-a newly developed theoretical framework for consumer behavior towards alternative food choices. As consumers' interest in local food has steadily increased in the past fifteen years, so has the number of research studies on consumers' attitudes and purchase behavior with regard to local food. A literature search was carried out on three online catalogues using the search terms taken into account. In all, the literature search returned 550 scientific articles. This paper provides an overview of 73 relevant publications, summarizes the main results, and identifies research gaps in the context of the Alphabet Theory. One major result was that, unlike organic food, local food is not perceived as expensive. Nevertheless, consumers are willing to pay a premium for local food. In mostly quantitative studies, consumer characteristics , attitudes, and purchase behaviors with regard to local food were assessed. Research gaps were identified in various areas: cross-national (cultural) comparisons, influence of different types of products (fresh vs. non-perishable, processed vs. non-processed, or plant vs. animal products), origin of foodstuffs used to produce local food as well as the influence of personal and social norms on the formation of attitudes towards local food. This contribution appears to be the first review of scientific articles from the field of local food consumption to present an overview on international research and to identify research gaps.
Previous studies on the value of terroir, or more generally geographical indications (GI), used hedonic techniques. We use historical data and exploit temporal and geographical variations in the introduction of wine GIs in early twentieth century France to study the impact on the price of specific wines in the years and decades following their introduction. We find large effects of GIs on prices of some Champagne wines, but no significant impact on Bordeaux or other Champagne wines.
In a traditional wine region such as Tuscany (Italy), the wine production is perceived by several industry players as weak and fragmented because it is mainly managed by small and medium-sized wineries that have limited market power compared to large companies and distributors. In this paper, we hypothesise that this problem was influenced - in a period of strong market growth - by producers' choices that underestimated the impact of several external forces (e.g. competition, changes in demand and regulation) and promoted strategies without considering their combination with key context-specific physical, structural and socio-cultural factors. The study investigates the origin of these marketing strategies confronted with the contested fragmentation, exploring both current and future trends of the wine market in Tuscany. The objective is to provide a better understanding on how the combinations between these factors and firm's activities define regional settings in which the different strategies are developed and how these settings can be used to promote more effective and calibrated strategies towards greater economic sustainability of the sector. The focus is to understand the nature and the dynamics of interlinkages between the adoption of quality-based differentiation strategies, the diversification of marketing channels, and their regional and local determinants. We adopt a mixed quantitative and qualitative research approach composed of an analytical framework, an econometric analysis, and interviews with wine producers. First, the method provides a conceptual framework to understand the interlinkages between producers' strategies and local and regional determinants. Then, the winery decision-making process is modelled through a two-by-two differentiation strategy model that represents the wineries' decision towards the adoption of PDO/PGI appellation or organic certification in relation with the choice of distribution channels. Through the reciprocal of the Herfindahl-Hirschman Index (HHI⁻¹) - calculated on alternative marketing strategies – we verified the extent of diversification of sale channels under the different quality choices (i.e. PDO/PGI and organic or without them). Then, the determinants of the choice of distribution channels were quantified by applying a censored regression model and the results were elaborated and discussed in the light of 32 producers' interviews. The main trend highlights the fragmentation of wine production that has been determined by the differentiation model adopted by the regional producers. The results confirm a great divide in strategies between those producing quality wines and those who do not: on the one hand being mainly involved in PDO/PGI or organic certification positively affects the choice of multiple distribution channels; on the other hand, those who are not involved in quality labels have concentrated their production in a restricted number of marketing channels. The analysis shows that different producers' strategies have been influenced by the interaction between structural factors, farm characteristics and terroir in response to external changes. It also reveals a transformation process in progress that involves the concentration of the supply chain. Producers are promoting greater consolidation and reassembling of the production through new producer networks and associations that aim to reduce the fragmentation and related weakness with new common strategies.
Purpose The concept of terroir is institutionalized through geographical indications (GIs) in large parts of the wine-producing world. GIs in wine are associated with certain taste characteristics. Mosel wine is said to be slender and fresh. However, external sources of pressure are recognized as challenging this notion. The purpose of this paper is to explore the narrative construction of Mosel wine and how institutions, markets and climate are presented as having implications for its taste. Design/methodology/approach Ethnographic fieldwork was carried out over ten weeks during the fall of 2016, consisting of three weeks of participant observation and 12 in-depth interviews. Post-fieldwork, data were interpreted as collective narratives. Additionally, a wide range of written sources on Mosel wine has been analyzed. Findings It is found that a development toward big-bodied wines was considered a threat to the region’s stylistic image, in which light-bodied wines represented the cornerstone. Consequently, this had triggered introspection and greater discursive attentiveness to “lightness” to preserve the credibility and identity of Mosel as a GI. Findings show that these aesthetic controversies functioned to recreate and consolidate the notion of Mosel wine and its sense of terroir. Originality/value Focusing on how taste in wine is narratively produced, this paper utilizes an inductive approach rarely employed within terroir research.