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Drifting Towards Bordeaux? The Evolving Varietal Emphasis of U.S. Wine Regions

In: The International Economics of Wine

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  • Julian M. Alston
  • Kym Anderson
  • Olena Sambucci

Abstract

In an ever-more-competitive global market, vignerons compete for the attention of consumers by trying to differentiate their product while also responding to technological advances, climate changes and evolving demand patterns. In doing so, they highlight their regional and varietal distinctiveness. This paper examines the extent to which the winegrape varietal mix varies within and among states of the United States and relative to the rest of the world, and how that picture has been evolving. It reports varietal intensity indexes for different regions, indexes of similarity of varietal mix between regions and over time, and pricebased quality indexes across regions and varieties within and among the three west-coast States. Broadly speaking, the mix of winegrape varieties in the United States is not very different from that in the rest of the world and, since 2000, it has become even less differentiated and closer to that of France and the world as a whole. But individual U.S. regions vary considerably in the mix of varieties in which they specialize and in the quality of grapes they produce of a given variety; and region-by-variety interactions have complex influences on the pattern of quality and production. We use measures of regional varietal comparative advantage and a Nerlovian partial adjustment model to account for some of the shifting varietal patterns in the U.S. vineyard and in winegrape production.

Suggested Citation

  • Julian M. Alston & Kym Anderson & Olena Sambucci, 2019. "Drifting Towards Bordeaux? The Evolving Varietal Emphasis of U.S. Wine Regions," World Scientific Book Chapters, in: Kym Anderson (ed.), The International Economics of Wine, chapter 23, pages 559-598, World Scientific Publishing Co. Pte. Ltd..
  • Handle: RePEc:wsi:wschap:9789811202094_0023
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    References listed on IDEAS

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    1. Fuller, Kate B. & Alston, Julian M. & Sambucci, Olena, 2014. "The Value of Powdery Mildew Resistance in Grapes: Evidence from California," Working Papers 162528, Robert Mondavi Institute Center for Wine Economics.
    2. Davide Gaeta & Paola Corsinovi, 2014. "Economics, Governance, and Politics in the Wine Market," Palgrave Macmillan Books, Palgrave Macmillan, number 978-1-137-39532-0, December.
    3. Jaffe, Adam B, 1986. "Technological Opportunity and Spillovers of R&D: Evidence from Firms' Patents, Profits, and Market Value," American Economic Review, American Economic Association, vol. 76(5), pages 984-1001, December.
    4. Kym Anderson, 2019. "Evolving Varietal and Quality Distinctiveness of Australia’s Wine Regions," World Scientific Book Chapters, in: Kym Anderson (ed.), The International Economics of Wine, chapter 24, pages 599-628, World Scientific Publishing Co. Pte. Ltd..
    5. Kym Anderson & Glyn Wittwer, 2019. "Modeling Global Wine Markets to 2018: Exchange Rates, Taste Changes, and China’s Import Growth," World Scientific Book Chapters, in: Kym Anderson (ed.), The International Economics of Wine, chapter 3, pages 51-90, World Scientific Publishing Co. Pte. Ltd..
    6. Jaffe, Adam B, 1989. "Real Effects of Academic Research," American Economic Review, American Economic Association, vol. 79(5), pages 957-970, December.
    7. Alston, Julian M. & Fuller, Kate B. & Kaplan, Jonathan D. & Tumber, Kabir P., 2013. "Economic Consequences of Pierce’s Disease and Related Policy in the California Winegrape Industry," Journal of Agricultural and Resource Economics, Western Agricultural Economics Association, vol. 38(2), pages 1-29, August.
    8. Kym Anderson, 2019. "Changing Varietal Distinctiveness of the World’s Wine Regions: Evidence from a New Global Database," World Scientific Book Chapters, in: Kym Anderson (ed.), The International Economics of Wine, chapter 22, pages 529-558, World Scientific Publishing Co. Pte. Ltd..
    9. Ashenfelter, Orley & Storchmann, Karl, 2014. "Wine and Climate Change," Working Papers 164854, American Association of Wine Economists.
    10. Tsang, Eric W. K., 2014. "Old and New," Management and Organization Review, Cambridge University Press, vol. 10(03), pages 390-390, November.
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    Cited by:

    1. Julian M. Alston & Davide Gaeta, 2021. "Reflections on the Political Economy of European Wine Appellations," Italian Economic Journal: A Continuation of Rivista Italiana degli Economisti and Giornale degli Economisti, Springer;Società Italiana degli Economisti (Italian Economic Association), vol. 7(2), pages 219-258, July.
    2. Kym Anderson & Signe Nelgen, 2021. "Internationalization, Premiumization and Diversity of the World's Winegrape Varieties," Wine Economics Research Centre Working Papers 2021-03, University of Adelaide, Wine Economics Research Centre.
    3. Sambucci, Olena & Alston, Julian M., 2017. "Estimating the Value of California Wine Grapes," Journal of Wine Economics, Cambridge University Press, vol. 12(2), pages 149-160, May.
    4. Bruno V. Miranda & Brent Ross & Jason Franken & Miguel Gómez, 2022. "Plural forms and differentiation strategies in the agri‐food sector: Evidence from the U.S. wine industry," Agribusiness, John Wiley & Sons, Ltd., vol. 38(3), pages 486-504, July.

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    More about this item

    Keywords

    Wine Globalization; Australia's Wine Internationalization; Wine Markets in Asia; Wine Price Distortions; Modelling Global Wine Markets;
    All these keywords.

    JEL classification:

    • O13 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Agriculture; Natural Resources; Environment; Other Primary Products
    • L66 - Industrial Organization - - Industry Studies: Manufacturing - - - Food; Beverages; Cosmetics; Tobacco

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