AAWE, Economics Dept, New York University, 19 W 4th St, 6Fl., New York NY 10012aawe@wine-economics.org

AAWE Working Paper No. 87 – Economics

 

World Wine Exports: What Determines the Success
of ‘New World’ Wine Producers?

Osiris Jorge Parcero and Emiliano Villanueva

Abstract

By using an econometric approach this paper looks at the evolution of the world wine industry in the period 1961-2005. A particular stylized fact is the appearance of non- traditional producing and exporting countries of wine from the beginning of the nineties. We show that the success of these new producing and exporting countries can be explained by the importance of the demand from non-producing countries with little or no tradition of wine consumption, relative to the world demand. This stylized fact is consistent with a testable implication of the switching cost literature and to the best of our knowledge this is the first time that this implication is tested.

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