Business Issue with Competing Pressures: Based on what you see in the three videos, identify a specific issue with competing pressures. How is a business issue influenced by a social concern?
The issue with competing pressures identified in the three videos involves product differentiation and authenticity. The two items presented were essentially the same product, however one was constructed in a more traditional manner. The Parmigiano Reggiano was crafted over the course of several years with techniques that have been around for centuries, with the goal to produce a truly authentic cheese. The Kraft cheese displayed, while also parmesan cheese, was most likely produced with modern production techniques in a factory. This replication by Kraft and presumably other brands is what lead the EU to certify the authenticity of Parmigiano Reggiano. This issue is influenced by a social concern as the consumer may not be able to differentiate between the two products, and thus a trademark is required. Also, Parmigiano Reggiano is most likely significantly more expensive than the Kraft alternative, which would allow Kraft to upcharge or undercut the parmesan cheese market if it weren’t for the regulation.
Rationales For and Against Regulation: Based on the issue you have selected, make one statement for government regulation to address the issue (rationale for regulation) and one statement for minimal regulation/the free market to address the issue (rationale against regulation):
The regulation is necessary to differentiate between a high-quality product and a low-quality product, that would seem the same to the consumer. This preserves the authenticity and quality of Parmigiano Reggiano, as they don’t have to switch production techniques, but still allows Kraft to be a competitor.
The regulation is not necessary as the free market will be the judge of the true quality of Parmigiano Reggiano in comparison to other alternatives. The regulation discourages innovation, and with increased regulation firms in the cheese market will lose the incentive to develop more efficient production techniques in fear of a loss of authenticity.
Other Examples Like This?: Based on the competing pressures you see in this video, identify another issue that has an ongoing debate among people who argue for government regulation to address the issue versus those who argue that the free market should address the issue.
On the topic of sustainability, there has been an ongoing debate between those in favor of using government regulation to phase out the plastic straw versus those who believe the innovations in the free market could accomplish the same task. A plastic straw ban would give rise to innovators who have already developed sustainable alternatives. Others argue that if these alternatives are truly more efficient and sustainable than the free market would also deem them more profitable and phase out the plastic straw.