Hostname: page-component-cd9895bd7-dzt6s Total loading time: 0 Render date: 2024-12-28T12:18:37.546Z Has data issue: false hasContentIssue false
  • English
  • Français

Modeling Global Wine Markets to 2018: Exchange Rates, Taste Changes, and China's Import Growth*

Published online by Cambridge University Press:  16 October 2013

Kym Anderson  and
Glyn Wittwer
Kym Anderson*
Affiliation:
Wine Economics Research Centre, School of Economics, University of Adelaide, Adelaide SA 5005Australia
Glyn Wittwer
Affiliation:
Centre of Policy Studies, Monash University, Clayton Vic. 3168Australia; e-mail: glyn.wittwer@monash.edu.
*
(contact author) e-mail: kym.anderson@adelaide.edu.au.
Get access Rights & Permissions [Opens in a new window]

Abstract

In this paper, we use a revised, expanded, and updated version of a global model first developed by Wittwer et al. (2003) to project the wine markets of its 44 countries plus seven residual country groups to 2018. Because real exchange rate (RER) changes have played a key role in the fortunes of wine market participants in some countries in recent years, we use the model to analyze their impact, first retrospectively during 2007–11 and then prospectively during the period to 2018 under two alternative sets of RERs: no change, and a halfway return to 2009 rates. In both scenarios, we assume a return to the gradual trend toward premium wines and away from nonpremium wines. The other major development expected to affect the world's wine trade is growth in China's import demand. Alternative simulations provide a range of possibilities, but even the low-growth scenario suggests that China's place in global wine markets is likely to become increasingly prominent. (JEL Classifications: C53, F11, F17, Q13).

Keywords

changes in tastesglobal grape and wine modelingreal exchange rate changes
Type
Articles
Information
Journal of Wine Economics , Volume 8 , Issue 2 , November 2013 , pp. 131 - 158
Copyright
Copyright © American Association of Wine Economists 2013 

Access options

Get access to the full version of this content by using one of the access options below. (Log in options will check for institutional or personal access. Content may require purchase if you do not have access.)

Footnotes

*

Revision of a plenary paper presented at the American Association of Wine Economists' Annual Conference, Stellenbosch, South Africa, June 26–29, 2013. Thanks are due to conference delegates for helpful comments and to Australia's Grape and Wine Research and Development Corporation for financial support under Project Number UA 12/08. Views expressed are solely those of the authors.

References

Anderson, K., and Nelgen, S. (2011). Global Wine Markets, 1961 to 2009: A Statistical Compendium. Adelaide: University of Adelaide Press. Freely accessible as an e-book at www.adelaide.edu.au/press/titles/global-wine/ and as Excel files at www.adelaide.edu.au/wine-econ/databases/GWM/.Google Scholar
Anderson, K., and Wittwer, G. (2001). U.S. dollar appreciation and the spread of Pierce's disease: Effects on the world's wine markets. Australian and New Zealand Wine Industry Journal, 16(2), 70–75.Google Scholar
Anderson, K., and Strutt, A. (2012). Emerging economies, productivity growth, and trade with resource-rich economies by 2030. Revision of a paper for the 15th Annual Conference on Global Economic Analysis, Geneva, 27–29 June.Google Scholar
Barton, D., Chen, Y., and Jin, A. (2013). Mapping China's middle class. McKinsey Quarterly, June. www.mckinsey.com/insights/consumer_and_retail/mapping_chinas_middle_class/.Google Scholar
Cavallo, A. (2013). Online and official price indexes: measuring Argentina's inflation. Journal of Monetary Economics, 60(2), 152–165. http://dx.doi.org/10.1016/j.jmoneco.2012.10.002Google Scholar
Euromonitor International. (2013a). Wine in the United Kingdom. Accessed September 5, 2013, at http://www.euromonitor.com/wine-in-the-united-kingdom/report/.Google Scholar
Euromonitor International. (2013b). Wine in Japan. Accessed September 5, 2013, at http://www.euromonitor.com/wine-in-japan/report/.Google Scholar
Euromonitor International (2013c), Wine in South Korea. Accessed September 5, 2013, at http://www.euromonitor.com/wine-in-south-korea/report/.Google Scholar
Euromonitor International. (2013d). Wine in Taiwan. Accessed September 5, 2013, at http://www.euromonitor.com/wine-in-taiwan/report/.Google Scholar
Kharas, H. (2010). The emerging middle class in developing countries. Working Paper 285, OECD Development Centre, Paris, January.Google Scholar
Harrison, J., and Pearson, K. (1996). Computing solutions for large General Equilibrium Models using GEMPACK. Computational Economics, 9(1), 93–127.Google Scholar
Lin, J.Y. (2013). Long live China's boom. Chazen Global Insights, Columbia Business School, New York, August 16, http://www8.gsb.columbia.edu/chazen/globalinsights/node/207/Long+Live+China%27s+Boom/.Google Scholar
OIV (Organisation Internationale de la Vigne et du Vin). (2013). State of the Vitiviniculture World Market. Paris, March (www.oiv.org).Google Scholar
Wittwer, G., Berger, N., and Anderson, K. (2003). A model of the world's wine markets. Economic Modelling, 20, 487–506.Google Scholar
World Bank. (2012). World Development Indicators. Washington, DC: World Bank. Accessed November 6, 2012, at www.worldbank.org.Google Scholar