A Strategic Analysis of the Phalaenopsis Orchid Industry in Taiwan and the Netherlands: Minimum Quality Standards of Quality-Upgrading Subsidies?
Resource
農業與經濟, 48, 107-138
Journal
農業與經濟
Journal Issue
48
Pages
107-138
Date Issued
2012-06
Date
2012-06
Author(s)
許淑媖
Abstract
The market share of Taiwan’s Phalaenopsis orchid has shrunk sharply mainly due to the Netherlands’ Phalaenopsis orchid having surpassed Taiwan either in the rate of infection or double stem. In order to analyze this scenario, we set up a model of vertical product differentiation to discuss the
influence of two policy tools on the quality of Taiwan’s Phalaenopsis orchid industry. The first tool in question is to set a minimum quality standard for the orchid industry, and the second one is to subsidize the orchid industry to the amount of its quality-upgrading expenditure. Our results show that imposing the policy of minimum quality standards raises the quality of both domestic and foreign orchids, and the difference in the quality of the two orchids is also narrowed down which further brings down the price gap.
Moreover, adopting a subsidization policy gives rise to the same effect on price, quality and the sales quantities. To sum up, the policy effects are equivalent for the minimum quality standards and quality-upgrading subsidies, which will no doubt help the domestic orchid industry raise its product quality.
Subjects
蝴蝶蘭、病毒率、補貼、最低品質標準
Phalaenopsis orchid, Infection rate of orchid, Minimum quality standards, Quality-Upgrading subsidies
Type
journal article
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