Question

One of the areas addressed by the ISO 14000 series is environmental labeling.

(PART A) How might individual firms benefit from using labeling standards?

(PART B) How might international trade be affected?

Be specific and please don't send the same answer that is already posted.

Answer 1

Part A

Labeling standards provide the firms with a direction about the acceptable labeling designs and standards prevailing throughout the world. It helps the individual firms by taking off their burden of labeling and of trying to make their product differentiated from the others only through the use of labels. This way, it allows the firms to concentrate more on the quality of the product as they can simply use the labels as per the standards and thus, focus more on the product quality.

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Part B

International trade can be affected both positively as well as negatively. It can be affected in a positive way by helping the small producers and the producers from the small countries in the ways mentioned in the part A. However, it may affect the international trade in a negative way as well as the firms who have the potential to provide good quality products as well as innovative labels, might not be able to use their labeling strategies due to these standards. Therefore, at the end, most of the things over-the-counter looks almost same, and thus, many producers lose the potential market.