home    about    browse    search    latest    help 
Login | Create Account

Organic Label, Bargaining Power, and Profit-sharing in the French Fluid Milk Market

Bonnet, Céline and Bouamra-Mechemache, Zohra (2016) Organic Label, Bargaining Power, and Profit-sharing in the French Fluid Milk Market. American Journal of Agricultural Economics, pp. 113-133.

Full text not available from this repository.

Document available online at: https://hal.inrae.fr/hal-02637852


The paper determines how the value-added created by an organic label is shared in a vertical chain among manufacturers and retailers. Using purchase data on the French fluid milk sector, we develop a structural econometric model of demand and supply that takes into account the bargaining power between manufacturers and retailers. Our results suggest that the organic label segment is more profitable, as it permits the existence of higher margins. Moreover, an organic label allows manufacturers to achieve more bargaining power relative to retailers, and hence to obtain a higher share of total margins. The econometric model is then used to assess the impact of an environmental policy in favor of the organic segment based on a mechanism of price support. Our results suggest that while a subsidy policy towards organic products benefits both manufacturers and retailers, a tax policy toward conventional products benefits manufacturers of national brands at the expense of retailers and manufacturers that provide the private labels. The benefits of such policies on the environment is relatively small. All such policies tend to increase the impact on global warming and land use, but reduce the impact on eutrophication, acidification, and energy use.

EPrint Type:Journal paper
Keywords:bargaining power (en), fluid milk market (en), environmental policy (en), organic (en), structural economics (fr), manufacturers (fr), retailers (fr)
Subjects:"Organics" in general
Research affiliation: France > INRAe - Institut national de recherche pour l’agriculture, l’alimentation et l’environnement
ISSN:ISSN: 0002-9092
Project ID:HAL-INRAe
Deposited By: PENVERN, Servane
ID Code:41041
Deposited On:12 Aug 2021 10:37
Last Modified:12 Aug 2021 10:37
Document Language:English

Repository Staff Only: item control page