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An Introduction to Geographic Indications

Geographic Indications (or 'origin-based labelling) are becoming increasingly important within global politics. This post provides a literature review of how we conceptualise and analyse Geographic Indications.

Photo Credit: http://www.arigat.eu/en/pdo-pgi

Geographical Indications (GIs) are a form of intellectual property right which affords its owner the exclusive use of ‘place-based names that convey the geographic origin, as well as the cultural and historical identity, of agricultural products’ (Bowen & Zapata, 2009: 108). Foremost is the concept of terroir; ‘that the special quality of an agricultural product is determined by the character of the place from which it comes’ (Gade, 2004: 849). The assumption here is that specific environmental conditions, including soil and climate, contribute to a food’s quality (DeSoucey, 2010: 438); conditions which cannot be replicated elsewhere. Also crucial are the human practices which maintain such environmental conditions, including ‘history, culture, know-how and tradition’ (Lenglet, 2014: 265). Thus, GIs rest on the idea that the quality of agricultural products depends on a combination of both natural and human factors.

The European Union (EU) has been the most active in seeking to protect GIs, creating two categories of intellectual property in 1992; Protected Designation of Origin (PDO) and Protected Geographical Indication (PGI). PDO exists as the strictest form of GI and seeks to protect, ‘with a name, a unique product that is not reproducible in another terroir’ (Bérard and Marchenay, 2006: 110). Under this system, producer groups must apply to the EU for PDO status, highlighting the link between their geographic region and their product, as well as the rules of production, including the materials and techniques to be used. Once granted, PDOs ensure that only those producers situated within the specified geographical area, who follow the rules of production, are able to use the label. Products named after member states or products with generic names, including Cheddar (Parrott et al, 2002: 245), are not granted PDO status. There has been a proliferation of registered GI products within the EU; 1,276 products had been registered as of 2018, with the majority located in the Southern European nations of Greece, Italy, Spain and Portugal (Ruiz et al, 2018: 1879).

Globally, the World Trade Organisation (WTO) requires all member states to provide legal means for producers to prevent their products from being appropriated in a way that deceives consumers or creates unfair competition (Josling, 2006: 350-351). However, the EU is pushing for the establishment of an international register for GIs which would extend protection to all products (Bérard & Marchenay, 2006: 111). Yet, the EU’s attempts to extend its GI system to the bilateral and multilateral level has received backlash from the US who argue that the European system for protecting food names is poor state planning and ‘smacks of protectionism’ (Blenkinsop, 2015). Resultantly, the conflict over the protection of GIs has become a vital issue in international trade, creating stumbling blocks for the establishment of key trade deals, including the Transatlantic Trade and Investment Partnership (TTIP)- a deal with the ‘potential to increase EU exports to the U.S. by 28 percent’ (Selig, 2016).

Despite the importance of GIs to international trade negotiations, and the effects that these intellectual property rights can have on societies, they remain poorly theorised (Voyce, 2007: 155). The purpose of this research is to consider existing theoretical and empirical approaches to origin-based labels to gain a better understanding of how GIs operate and the effects they that have. Already, academics and policymakers have analysed the economic effects of GI protection, focusing on how origin-based labelling can improve the functioning of the market through information provision, while also allowing rural communities to gain better market access in their pursuit for development. However, there is also a body of work which speaks to the political economy aspect of GIs. These approaches, often drawing on Karl Polanyi’s concept of ‘embeddedness’, view GIs as a form of resistance to neoliberal capitalism, with the protection of these products serving to ‘re-embed’ agricultural production within local places. This is predicted to safeguard the cultural, traditional, and environmental resources of rural communities. These perspectives will now be analysed in greater depth.

Economic Benefits of Geographic Indications

Much of the existing literature on GIs has focused on the economic rationale for protecting these goods, particularly concerning the issue of information asymmetry (Bramley et al, 2009; Rangnekar, 2004; Réquillart, 2007). The critical issue is that in free markets, there exists an asymmetry between the producer and consumer; the producers know the quality of the product while the consumer may only know little (MacKenzie, 2003). This can lead to severe impediments for the functioning of the market, causing the quality of total supply to fall and driving higher quality products out of the market, meaning that some consumers cannot satisfy their preferences (Bramley et al, 2009: 115). GIs help to overcome this issue by providing information to consumers- they act as signalling devices which indicate the reputation of a good, linking a product and its quality to a particular geographical origin (Rangnekar, 2004: 13). This signalling function is particularly important in light of the trend that has emerged which sees consumers place increasing value on food quality and ethical production methods (Blakeney, 2017: 165) as well as having a ‘renewed interest in…culinary heritage’ (Bramley et al, 2009: 109).

Thus, GIs are promoted as a tool which serves to improve the functioning of the market, allowing for smooth transactions between producers and consumers. This benefits consumers; they no longer have to exert time to establish where the product has come from and they can be sure that the product is of good quality, avoiding fraudulent goods (Parasecoli & Tasaki, 2011: 110). This argument assumes a link between geographic origin and quality. For Josling (2006: 338), this assumption is not concrete and requires more significant empirical investigation; if the perceived link between origin and quality is not reliable, then the information transmitted by origin-based labels may serve to deflect choice and restrict competition, thus inhibiting the market. Indeed, Rangnekar (2004: 25) reminds us that ‘quality’ is a highly contested term which can be defined in numerous ways. Therefore, while some consumers may view quality as linked to geographic origin and cultural heritage, others may view ‘quality’ foodstuffs as determined by efficiency and the satisfaction of hygiene and safety considerations (Parrott et al, 2002: 248).

GIs have also been analysed as a policy to induce rural development (Bérard & Marchenay, 2006; Bramley et al, 2009; Cei et al, 2018; Folkeson, 2005). From this perspective, the benefit of origin-based labelling is that producers can obtain a premium for their goods while also keeping foreign competitors, who may seek to sell ‘similar products at lower prices under the same name’ (Parasecoli & Tasaki, 2011: 110), out of the market. As such, GIs erect barriers to entry, establishing monopoly control over the product while providing farmers and rural communities with higher incomes. Similarly, origin-based labelling allows producers to differentiate their products and engage in niche marketing, thus improving market access (Bramley et al, 2009: 117-118). This is predicted to be of great importance to less-favoured areas, supporting farmers and agricultural producers that are less able to compete in ‘a globalized, commodity driven, marketplace’ (Parrott et al, 2002: 243). Indeed, over 70% of GIs protected by the EU are located in less-favoured areas (Ibid). However, it is not only farmers and producers who benefit; GIs also have spillover effects for rural economies in the form of enhanced tourism. This is the case in France, where many people are aware of the Burgundy region due to its publicity through Burgundy wines (Rangnekar, 2004: 17).

The evidence on whether GIs can promote rural development remains mixed. For such a policy approach to be effective, consumers must be aware and willing to buy regional products. However, surveys conducted have shown mixed responses; consumers in France and Spain had a keen awareness and willingness to buy regional products while those in the UK and Finland were much more unlikely to buy them (Parrott et al, 2002: 253). Nonetheless, consumers can be persuaded to buy regional products if they are informed about the positive impacts that their purchases can have on rural communities (Teuber, 2011: 915). Studies of GIs suggest that these products do command a premium for farmers and agri-food producers. This is the case in France, where Bresse poultry commands ‘quadruple that of commodity poultry meat’ (Babcock, 2003: 3) and dairy farms in the Comté area ‘are 32% more profitable than similar farms outside the Comté area’ (Blakeney, 2017: 163).

However, there is no guarantee that GIs will lead to equitable rural development. Callois (2004: 15) argues that GIs can produce exclusionary effects whereby ‘the rise in some farmers’ income does not benefit the rural region as a whole’. Indeed, there is no guarantee that GIs will benefit small farming businesses, since large, industrialised firms within the region can come to dominate the production of the good through greater efficiency and economies of scale (Folkeson, 2005: 26), thus appropriating the gains from GI protection. Similarly, GI protection can harm other communities, reducing the competitiveness of other regional goods not yet protected (Parrott et al, 2002: 248), and preventing such communities from selling the protected product. That GIs have a mixed impact upon rural economic development is confirmed by Barnette (2012) who focuses on the GIs of Café de Colombia and Tequila. In the case of Café de Colombia, producers were ‘able to solidify the origin-quality link for their product’ leading to a premium put on its terroir, thus fostering rural economic development (Barnette, 2012: 111). However, in the case of Tequila, the link to terroir has been lost, and production has become commercialised; this has prevented the realisation of rural economic development with the benefits, instead, accruing to a few international liquor companies (Barnette, 2012: 107). The outcomes of GIs for rural development should, therefore, be treated on a case by case basis and are open to further empirical analysis.

Moving Beyond Economic Value: Embeddedness Theories

Despite focusing on their purely economic effects thus far, academics have also analysed the non-market effects of GIs, often conceptualising the policy as a form of resistance which aims to protect not only rural livelihoods, but also cultures, identities, environments and traditional knowledge from the excesses of neoliberal capitalism and the global agri-food industry (Barham, 2002; DeSoucey, 2010; Sekine & Bonanno, 2017). While numerous theoretical approaches have been used to analyse GIs as a form of resistance, embeddedness theories have received much of the attention (Barham, 1997, 2002, 2003; Bowen, 2010; Bowen & Zapata, 2009; Dagne, 2015). These studies draw on Karl Polanyi’s The Great Transformation (TGT), particularly his concept of the ‘double movement’, in order to view GI protection as a form of resistance, capable of providing an alternative to ‘placeless food production systems’ (Bowen & Zapata, 2009: 108).

In TGT, Polanyi offers a unique insight into the market system, critiquing the ideas of the Austrian School which championed free-market economics (Kuttner, 2014). From a Polanyian perspective, the concern should not be focused purely on whether markets are economically efficient. Instead, we should think about the ‘human and environmental costs of allowing people and nature to be included as parts of the production process within the market economy’ (Watson et al, 2014). Indeed, Polanyi viewed the expansion of the market system during the 19th century as a political project, not as a result of the natural expansion of barter. Prior to the Industrial Revolution, Polanyi regarded the economy as ‘embedded in systems of social norms and institutions’ (Barham, 2002: 351). However, a laissez-faire movement sought to expand the role of the market, imposing the logic of the market on ordinary people (Block, 2001: xxvii), and ordering the production and distribution of goods through the self-regulating mechanism (Buğra, 2007: 173). Consequently, the market would become ‘disembedded’, with society being run ‘adjunct to the market’ (Polanyi, 2001: 60).

Key to the expansion of the market system was the commodification of humans into labour and nature into land. Polanyi referred to these as fictitious commodities; the market treats land and labour as items that are to be bought and sold, yet this does not capture their full identity (Barham, 1997: 240). This is because neither nature nor humans are produced for sale in markets. Yet, within the self-regulating market, all those aspects of both humans and their habitats which do not directly enter the production process are treated merely as afterthoughts (Barham, 2002: 315). Thus, the expansion of the market means that the needs of both humans and nature are increasingly overlooked since they fall outside the logic of market exchange (Barham, 1997: 240).

Here, the movement towards neoliberal capitalism and the global agri-food industry can be seen as the most recent attempt at ‘disembedding’ the economy from society. This is because neoliberal capitalism is a system which views ‘competition as the defining characteristic of human relations’ (Monbiot, 2016) and treats the market as ‘the most effective way to allocate human, economic and natural resources’ (Bonanno, 2019: 28). This neoliberal ideology is pushing the trend towards globalisation whereby goods, capital and labour can move without friction, regardless of space or time (Barham, 2003: 129). One of the most critical aspects of this trend has been the development of the ‘food system’, which aims to feed populations ‘mostly through a system of market relationships’ (Rastoin, 2012). Central to the food system is the agri-food industry- dominated by a handful of nations, including the US and China, as well as multinational corporations, such as Nestle and Danone (Ibid).

Polanyi saw such a system as fundamentally destructive; allowing the market to be the sole director of both humans and their environment would result in catastrophe, with society demolished and ‘nature reduced to its elements’ (Polanyi, 2001: 76). Indeed, the development of neoliberal capitalism and the global agri-food business has had negative consequences for societies and their surroundings. The drive for profit has resulted in overproduction and pollution (Rastoin, 2012), while the standardisation and mechanisation of agricultural production has harmed biodiversity (Parasecoli & Tasaki, 2011: 116). Further, the homogenisation of brands and the industrialisation of agriculture is creating ‘placeless foodscapes’ (Ilbery & Kneafsey, 2000: 319), eliminating traditional and regional products. This commercialisation of agriculture is destroying rural communities, forcing people to migrate to cities where they face dire employment opportunities (Buğra, 2007: 180). The loss of such communities and their traditional products harms societies, with local cultures and traditional knowledge put in jeopardy (Solecki, 2014: 143).

Similarly, the homogenising forces of globalisation and the appropriation of traditional foods by large corporations can be seen as an attack on national identities (DeSoucey, 2010: 435). This is undoubtedly the case in France, where 34% of surveyed citizens see excessive US influence on French food, thus putting their French identity in danger (Gordon & Meunier, 2001: 21). Therefore, the development of neoliberal capitalism and the industrial agri-food system is charged with having negative impacts on the environment, as well as cultures, identities and traditional knowledge.

As a result of the pernicious effects of the market system, groups in society would collectively organise and resist against commodification and the increasing intrusion of the market logic, restricting the market through new laws or social institutions (Barham, 1997: 241). Indeed, it is not the case that markets disappear as a result of such resistance; rather, they are ‘made to serve all of humankind’ (Barham, 2002: 352). It is in this context that GIs have been understood as a Polanyian ‘countermovement’ whereby societies seek to resist the expansion of the market system and ‘re-embed a product in the natural processes and social context of its territory’ (Barham, 2003: 130). As such, GIs seek to challenge the ‘abstract capitalist relations that fuel exploitation in the global agri-food system’ (Raynolds, 2000: 298) and possess a transformative function which can re-link ‘production to the social, cultural and environmental aspects of particular places’ (Barham, 2003: 298). Resultantly, GIs are conceptualised as a tool which can help to sustain natural habitats, cultures and traditional knowledge (Dagne, 2015: 693).

Evaluating the ‘Re-embedding’ Nature of GIs

The idea that GIs help to ‘re-embed’ production and protect communities and their environments from the excesses of neoliberal capitalism and the agri-food industry has received mixed evaluations. Riccheri et al (2004: 63) report that for the eight GIs studied, all had a positive effect on biodiversity and landscape conservation. This was certainly the case with the Idiazábal Cheese PDO, a Spanish cheese which is produced using traditional grazing systems that help to conserve soils and landscapes in the Basque Country (Riccheri et al, 2004: 64). A similar finding is evident in the case of Comté, where the production process retains its historical ties and local dairy farmers work hard to maintain diversity in grasses and flora (Bowen, 2010: 219). Thus, PDOs have helped to maintain traditional production techniques which help to protect natural habitats. Indeed, cultures have also received protection; this is the case with the GI for Darjeeling tea, which helps to maintain the unique craftsmanship culture of Indian tea growers that has existed in the hilly regions of Darjeeling since the British colonial period (Zahur, 2017: 197).

However, not all GIs have the same positive outcomes. In the case of Tequila, the GI has been dominated by a few multinational corporations which are primarily focused on achieving a more stable supply of agave, ignoring the ‘contributions of the agave farmer’ and the ‘traditional practices that historically defined tequila’ (Bowen, 2010: 225). Consequently, the production of agave is becoming increasingly industrialised and chemical-intensive, eroding not only natural habitats but also the rich cultural heritage and traditional knowledge that used to go into the production of Tequila (Bowen & Zapata, 2009: 115). This demonstrates that origin-based labelling is not enough on its own, GIs require careful management and must maintain their link to terroir if they are to truly protect rural regions and prevent powerful extra local actors from taking control (Bowen & Zapata, 2009: 117).

Yet, more fundamental critiques challenge the idea that GIs resemble a Polanyian countermovement which can successfully re-embed production within local environmental and social contexts. Guthman (2007: 457) is particularly sceptical, arguing that GIs are ineffective in bringing about positive social and environmental improvements as they concede the market as the ‘locus of regulation’. That GIs do not ‘re-embed’ the production of traditional goods within natural and social contexts is supported by Sekine & Bonanno (2017). These authors argue that ‘while GI mitigates some of the contradictions of free-market capitalism…it does not transcend the fundamental dimensions of capitalist production and consumption’ (Sekine & Bonanno, 2017: 107). This equates with the views of scholars who have analysed TGT, since ‘re-embedding’ requires a ‘complete break with the prevailing market logic’ (Carton, 2014: 1005) and demands the full ‘de-commodification of land, labour and money’ (Lacher, 1999: 315). These changes would require the transition to an entirely different system, such as Socialism (Carton, 2014: 1005). Thus, while GIs seek to regulate capitalism, they are unable to overcome the dominant market system which champions global competition and remains open to corporate control (Sekine & Bonanno, 2017: 115; Bonanno, 2019: 33). This brings into question whether GIs should be conceptualised as a form of resistance to neoliberal capitalism and the global agri-food industry.

Concluding Remarks:

Geographic Indications are becoming increasingly important in the global sphere. It is therefore crucial that we understand these origin-based labels; how they operate and what effects they have. The purpose of this post was to provide a starting point for further study. The ‘economic benefits’ perspective opens up discussion about how GIs can help to smooth the functioning of the market, while also promoting economic development. Conversely, embeddedness theories suggest that GIs operate as a form of resistance to global capitalism that serves to safeguard cultures, traditions, local communities, and environments. In my next post, I will investigate these questions further, providing a re-conceptualisation of the Polanyian approach to origin-based labelling systems.


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