Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/55311
Authors: 
von Schlippenbach, Vanessa
Teichmann, Isabel
Year of Publication: 
2011
Series/Report no.: 
Discussion papers // German Institute for Economic Research 1120
Abstract: 
This paper highlights the strategic role that private quality standards play in food supply chains. Considering two symmetric retailers that are exclusively supplied by a finite number of producers and endogenizing the producers' delivery choice, we show that there exist two asymmetric equilibria in the retailers' quality requirements. The asymmetry is driven by both the retailers.incentive to raise their buyer power and the retailers' competition for suppliers. We find that the use of private quality standards is detrimental to social welfare. A public minimum quality standard can remedy this unfavorable welfare outcome.
Subjects: 
private quality standards
vertical relations
buyer power
food supply chain
JEL: 
L15
L42
Q13
Document Type: 
Working Paper

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