Understanding the Real-World Impact of Geographical Indications: A Critical Review of the Empirical Economic Literature

Abstract

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.

Geographical Indications and local development: the strength of territorial embeddedness

“…A final group of papers investigates the role of GIs in supporting socio-economic development (see Torok et al, 2020, for a review). The majority of these contributions focus on specific case studies and adopt qualitative approaches (e.g., Belletti et al, 2015;Bowen, 2010), such as interviews, desk research and figure comparisons (Bowen & Zapata, 2009;Dogan & Gokovali, 2012;Tregear et al, 2007).…”

“…The effects generated by GIs in terms of local development can be mediated by different contextual conditions and can be activated through different mechanisms (Torok et al, 2020). In what follows we test a set of heterogeneity dimensions of the GIs' effects related to territorial and GI characteristics.…”

“…The literature on the linkage between GIs and the development of rural areas is rich (Bonanno et al, 2019;Torok et al, 2020). However, notwithstanding some relevant exceptions (Carbone et al, 2014;Cei et al, 2018;Food and Agriculture Organization (FAO), 2018) the subject has thus far mainly been investigated through qualitative studies focusing on few products, macroregions or adopting a supply-chain approach (Kizos & Vakoufaris, 2011).…”

What Is the Environmental Impact of Wine Entering Global Value Chains? Studying the Evolution of CO2 Emissions from the Export of Spanish Denomination of Origin Wines

“…They are also defined by different historic, economic and social circumstances, which have formed the respective winemaking sectors in each case. This combination of factors finally gives rise to the transferability of concepts such as quality and exclusivity transmitted in the end product [ 95 , 96 , 97 ].…”

Does Altitude and Forest Density Affect Economic Growth? a Case Study of Kalimantan Barat

“…This region treaties also acknowledge the need to strengthen the economic, social and territorial cohesion, particularly concerning the areas which suffer from severe and permanent or demographic handicaps, such as mountains, island, outermost or sparsely populated areas (Monfort, 2009). Geographical indications on growth have a significant impact on local economic actors and households (Scott, 2006;Török, Jantyik, Maró, & Moir, 2020), summarise that geography is an active component of economic performance, precisely portraying entrepreneurship and innovation in many sectors.…”