Imports versus Domestic Production: A Demand System Analysis of the U.S. Red Wine Market
AbstractThe U.S. wine market experienced rapid growth in all facets—production, consumption, exports, and imports—over the past decade. Red wine imports more than tripled while consumption of domestically produced red wines doubled. This research estimates demand elasticities of U.S. red wine imports from five countries accounting for over 90% of imports—Italy, France, Spain, Australia, and Chile—using the first-difference version of the almost ideal demand system (AIDS). These elasticities are compared with those for domestically produced red wine. Results for conditional expenditure elasticities indicate that the U.S. red wine industry gains over imports when U.S. consumers’ total expenditures on red wine increase. However, comparing own- and cross-price elasticities reveals an increase in the price of U.S. red wine results in a decline in quantity demanded six times greater than for French and Italian red wines and over 20 times greater than other import countries, thus harming the U.S. red wine industry. Empirical results suggest that U.S. red-wine producers could increase their total revenue by decreasing prices, while Italian and French producers can increase total revenues by increasing them. Copyright 2003, Oxford University Press.
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
Bibliographic InfoArticle provided by Agricultural and Applied Economics Association in its journal Review of Agricultural Economics.
Volume (Year): 25 (2003)
Issue (Month): 1 ()
Contact details of provider:
Postal: Oxford University Press, Great Clarendon Street, Oxford OX2 6DP, UK
Phone: (414) 918-3190
Fax: 01865 267 985
Web page: http://www.aaea.org/
More information through EDIRC
Other versions of this item:
- Seale, James L., Jr. & Merchant, Mary, 2002. "Imports versus Domestic Production: A Demand System Analysis of the U.S. Red Wine Market," Technical Papers 15637, University of Florida, International Agricultural Trade and Policy Center.
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Chalfant, James A, 1987. "A Globally Flexible, Almost Ideal Demand System," Journal of Business & Economic Statistics, American Statistical Association, vol. 5(2), pages 233-42, April.
- Seale, James L., Jr. & Sparks, Amy L. & Buxton, Boyd M., 1992. "A Rotterdam Application To International Trade In Fresh Apples: A Differential Approach," Journal of Agricultural and Resource Economics, Western Agricultural Economics Association, vol. 17(01), July.
- Seale, James Jr. & Walker, Wayne E. & Kim, In-Moo, 1991. "The demand for energy : Cross-country evidence using the Florida model," Energy Economics, Elsevier, vol. 13(1), pages 33-40, January.
- Moschini, GianCarlo, 1995. "Units of Measurement and the 'Stone Index' In Demand System Estimation," Staff General Research Papers 5058, Iowa State University, Department of Economics.
- Terry L. Kastens & Gary W. Brester, 1996. "Model Selection and Forecasting Ability of Theory-Constrained Food Demand Systems," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 78(2), pages 301-312.
- Harri, Ardian & Brorsen, B. Wade & Muhammad, Andrew & Anderson, John D., 2010.
"Estimating a Demand System with Seasonally Differenced Data,"
Journal of Agricultural and Applied Economics,
Southern Agricultural Economics Association, vol. 42(02), May.
- Harri, Ardian & Muhammad, Andrew & Anderson, John D., 2008. "Estimating a Demand System with Seasonally Differenced Data," 2008 Annual Meeting, July 27-29, 2008, Orlando, Florida 6427, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
- Malorgio, Giulio & Camanzi, Luca & Grazia, Cristina, 2007. "Effectiveness of European Appellations of Origin on the International wine market," 105th Seminar, March 8-10, 2007, Bologna, Italy 7896, European Association of Agricultural Economists.
- Muhammad, Andrew & Jones, Keithly G., 2009.
"An Assessment Of Dynamic Behavior In The U.S. Catfish Market: An Application Of The Generalized Dynamic Rotterdam Model,"
2009 Annual Meeting, January 31-February 3, 2009, Atlanta, Georgia
45912, Southern Agricultural Economics Association.
- Muhammad, Andrew & Jones, Keithly G., 2009. "An Assessment of Dynamic Behavior in the U.S. Catfish Market: An Application of the Generalized Dynamic Rotterdam Model," Journal of Agricultural and Applied Economics, Southern Agricultural Economics Association, vol. 41(03), December.
- Thompson, Stanley R. & Sam, Abdoul G., 2008. "Country of Origin Advertising and U.S. Wine Imports," 2008 Annual Meeting, July 27-29, 2008, Orlando, Florida 6553, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
- Castellon, Cesar E. & Boonsaeng, Tullaya & Carpio, Carlos E., 2012. "Demand System Estimation in the Absence of Price Data: an Application of Stone-Lewbel Price Indices," 2012 Annual Meeting, August 12-14, 2012, Seattle, Washington 124819, Agricultural and Applied Economics Association.
- Marette, Stephan & Zago, Angelo M., 2003. "Advertising, Collective Action, And Labeling In The European Wine Markets," Journal of Food Distribution Research, Food Distribution Research Society, vol. 34(03), November.
- Lee, Young-Jae & Kennedy, P. Lynn & Hilbun, Brian M., 2008. "Import Demand System Analysis Of The South Korean Wine Market With The Source Differentated Aids Model," 2008 Annual Meeting, July 27-29, 2008, Orlando, Florida 6345, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
- Seccia, Antonio & Nardone, Gianluca & Stasi, Antonio, 2008.
"Analisi del mercato Italiano del vino Syrah
[Analysis of Italian Market of Syrah Wine]," MPRA Paper 14665, University Library of Munich, Germany, revised 15 Mar 2009.
- Zheng, Yuqing & Kaiser, Harry M., 2008. "Advertising and U.S. Nonalcoholic Beverage Demand," Agricultural and Resource Economics Review, Northeastern Agricultural and Resource Economics Association, vol. 37(2), October.
- Davis, Timothy R. & Ahmadi-Esfahani, Fredoun Z. & Iranzo, Susana, . "Demand under product differentiation: an empirical analysis of the US wine market," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society.
- Seale, James L. Jr. & Zhang, Lisha & Traboulsi, Mohamad R., 2013. "Domestic and Foreign Sources of U.S. Demand for Fresh Vegetables and Fruits," 2013 Annual Meeting, August 4-6, 2013, Washington, D.C. 150769, Agricultural and Applied Economics Association.
- Poudel, Pawan & Keithly, Walter R., Jr., 2008. "Analysis of United States and European Union Import Demand for Shrimp," 2008 Annual Meeting, February 2-6, 2008, Dallas, Texas 6748, Southern Agricultural Economics Association.
- Antonis Michis & Anna Markidou, 2013. "Determinants of retail wine prices: evidence from Cyprus," Empirical Economics, Springer, vol. 45(1), pages 267-280, August.
- Oyinbo, O. & Omolehin, R. A. & Abdulsalam, Z., 2013. "Analysis of the Demand for Rice in Kaduna State, Nigeria," AGRIS on-line Papers in Economics and Informatics, Czech University of Life Sciences Prague, Faculty of Economics and Management, vol. 5(3), September.
- Okrent, Abigail M. & Alston, Julian M., 2012. "The Demand for Disaggregated Food-Away-from-Home and Food-at-Home Products in the United States," Economic Research Report 132469, United States Department of Agriculture, Economic Research Service.
- Lee, Young-Jae & Kennedy, P. Lynn & Hilbun, Brian M., 2010. "Implicit Price And Demand In Oligopolistic Competition: An Application To The U.S. Trout Market," 2010 Annual Meeting, July 25-27, 2010, Denver, Colorado 60824, Agricultural and Applied Economics Association.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Oxford University Press) or (Christopher F. Baum).
If references are entirely missing, you can add them using this form.