Intra-industry trade in the wine sector in the enlargedEuropean Union

International trade theory suggests that advancedtrade integration may lead to a higher level of intra-industrytrade. The enlargement of the European Union (EU) duringthe last decade is a good example to analyse the intra-industrytrade in wine products. The aim of the paper is to analyse thepattern and drivers of horizontal intra-industry trade in thewine sector within the EU between 2000 and 2011. We em-ploy an empirical strategy developed by Cieślik ( 2005 )totestHelpman and Krugman (1985) model. We find a growingtrend in intra-industry trade with dominance of vertical intra-industry trade. Estimations suggest that Belgium, France, theNetherlands and Germany report the highest level of intra-industry trade within the EU. The level of intra-industry tradeis highest among old member states. Empirical evidence indi-cates that the standard intra-industry theory finds some sup-port in our data when we control for the sum of capital tolabour ratios in the estimated equations instead of relativecountry-size variables. We find that the EU enlargement pos-itively influences total and vertical intra-industry trade while ithas negative impacts on horizontal intra-industry trade.Distance has negative effects on all types of intra-industrytrade.