The economic regulation of quality in the Italian VQPRD sector: which perspectives?

The Appellation of Origin system is aimed at reducing consumer's information costs,assuring a minimum quality standard and wine typicity, as well as maintaining a diversified supplyin order to satisfy consumer s tastes heterogeneity. The effectiveness of the system is menaced byquantity and quality uncertainty, free riding phenomena, vertical relationships complexity andhold- up risks. The long term risk of the drop of the collective reputation of the Appellationjustifies the economic regulation of the supply by the sectorial Organizations. Thus, it is necessaryto evaluate ther role in the construction of the competitive advantage of the quality wine system.Then, the question that we address in this paper is that of the effectiveness of the supplyregulation of quantity and quality in the Italian system of Appellation of Origin. We analyze thecurrent context of the Italian Appellation of Origin Chianti Classico and the mechanisms of thesupply economic regulation. At first, we describe the structural and commercial characteristics ofthe Appellation, the vertical relationships among the agents, the trend of the most importanteconomic indicators of the Appellation. Then, we provide an analysis of the current mechanismsof the economic regulation of supply, from the specific production requirement s to the role of thesectorial organisation in the Appellation quality strategy. Finally, we point out the problems andthe possible evolutions of the Appellation of Origin's system, in the context of the Reform of theCMO of wine.