The Economics of Ecolabelling - SEAFOOD Ecolabelling: Principles and Practice - page 54

and are substitutable to a large extent with other species, even if not to as great an
extent as are the whitefish species (also see Chapter 17 for a discussion of possible
substitutions). Thus, an ecolabel will be a means to differentiate a product, even
in the unlikely event that all sources of a particular species become certified. As a
result, it seems likely that ecolabelling as a market-based incentive will continue to
be effective in contributing to the drive for environmental reforms within capture
fisheries.

2.5 Conclusions and need for future research

This chapter has considered the economics of ecolabelling at a variety of levels
of the seafood market. This is presented from the perspective of the consumer,
which is the level that has perhaps traditionally received the most focus because
the consumer ultimately must demand sustainable seafood in order to provide the
market-based incentive to producers to supply such products, and the perspectives
of the intermediate market level of the processors and the retailers who up to now
have been helping to create that consumer demand, and the fisheries themselves.
While the fundamental theory of the economics of ecolabelling is not complex,
application of the research to the ecolabelling of seafood is only at the inception
stage, and much has yet to be done to answer some of the remaining key questions.
First and perhaps foremost, now that a range of ecolabelled products has been
in the marketplace, some for a considerable period of time, research on the actual
market benefits of ecolabelling programmes needs to be conducted. This research
should be conducted at all levels of the market. If the consumer is paying a pre-
mium, how much of that premium is being transmitted down the market chain to
the ex-vessel level? How are market shares of certified fish being realigned relative
to noncertified fish? Answers to these questions are very important for a number
of reasons. For example, proof of market benefits, sufficient to cover costs of certi-
fication, will provide incentives to fisheries to sign on to assessments and attempt
to remain certified through reassessments. Proof of market benefits, sufficient to
cover costs, will provide incentives for the seafood industry to process or retail
ecolabelled seafood.
On a less positive note, if market research shows there are premiums being
paid for certified products, programmes will need to ensure that their chain-of-
custody and traceability programmes are strong enough to withstand the potential
for falsification of labels, i.e. product fraud.
Second, virtually all the research conducted so far has focused on consumer
demand for ecolabelled seafood from capture fisheries, while few has investigated
consumer demand for aquaculture production from best practices. With proposals in
the US for open-ocean aquaculture, the tremendous growth potential in aquaculture
production worldwide and the potential growth in ecolabelling programmes for