Cooperation and cooperative in southern European wine production : the nature of successful institutional innovation, 1880-1950

The paper examines the nature of cooperation and the establishment of formal wine making cooperatives amongst wine producers in three countries - Italy, France and Spain. High monitoring costs associated with wage labour, and increasing economies of scale in wine making encouraged large and small growers to cooperate in a large number of areas. The collapse in wine prices in the early twentieth century stimulated widespread interest in wine making cooperatives. Yet despite the apparent economic advantages of membership for smaller producers, the diffusion of cooperatives varied significantly between, and within, these countries. Access to long term capital, the role of church and political parties in encouraging producer cooperatives, the availability of alternative wine making facilities, and the degree of mobility of small growers, are all shown to be important.