Government Regulation and PDOs

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The competing pressure in regards to Parmigiano Reggiano is the government regulation over where the cheese can be sold. The European Union created PDO regulations to ensure the authenticity and quality of the foods sold. While PDOs are supposed to protect the consumer from food of imitation, they make it difficult for other companies to sell the same product. Companies like Kraft cannot sell “Parmigiano Reggiano” and therefore have to sell “Pamsello Italiano”. This creates direct competition between brands. Without the PDO, Parmigiano Reggiano could establish a deal with Kraft to eliminate the competition and achieve more profit. The social concern was that consumers must be protected as they could buy products they do not truly want. Consumers needed authenticity from the PDOs. Protecting the consumer is a business and social concern, so the European Union created the PDO to address both issues.

Based on the videos, government regulation with PDOs help consumers by ensuring the authenticity of the products they buy. The Pindot pattern of the Parmigiano Reggiano ensures consumers that they are purchasing an authentic product. With PDOs, the European Union monitors companies and products, causing less company deception and more transparency with the products sold. Some believe that government should have less regulation in the free market. Regarding PDOs, some believe that companies should be able to make deals with other companies for a product to be sold. Parmigiano Reggiano cannot create a deal with Kraft because that would be a violation of the PDOs. Limiting trade and deals between two companies could prevent the market from growing to its potential. One may also argue that not allowing the market to grow to its full potential impacts the consumer because they may invest in the Parmigiano Reggiano company. These investors will never know if a deal with Kraft could increase the value of their investments due to these government regulations.

The issue of Monopolies is an ongoing debate among proponents of government regulation, and among those who disagree with government regulation. A business monopoly is when a company has complete control over the supply or trade of a good while they are also one of the only companies in a specific market. An example of a monopoly is Microsoft. At the same time, there are a few companies that can provide the same service; Microsoft is one of the leading technology companies in the world. Some believe this is a good thing, as interconnectedness across many people will lead to easier collaboration on group projects or services. Some believe monopolies are terrible as they eliminate the choice as a consumer; if one wants a particular service, they do not have many options to get it. The Government has strict rules on monopolies in the private sector as they want to help the consumer have various options. However, the Government also engages in monopolies in the forms of Railroad, mail, water services, and electric services. Some believe that the Government cannot talk about the problems with monopolies as the Government willingly creates them as they see fit.