Strategies and Intepreting Models of a Reformed DOC: the Prosecco Case Study

Luca Rossetto, Vasco Boatto and Luigino Barisan
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Luca Rossetto: University of Padova
Vasco Boatto: University of Padova
Luigino Barisan: University of Padova

No 27-2011, Working Papers from Enometrica - Review of the Vineyard Data Quantification Society (VDQS) and the European Association of Wine Economists (EuAWE) - Macerata University, Faculty of Communications

Abstract:

Recently, Prosecco wine industry has dramatically increased. Wine producers were able to exploit successfully opportunities coming from both the supply growth and consumer appreciation (Boatto et al., 2008; Boatto et al., 2009). More recently, this success has been accomplished by an increasing competition on both domestic and international markets. In July 2009, the geographical denomination Prosecco (DO) has been strongly reformed: i) the Prosecco area has been unambiguously de ned by introducing a new DOC (controlled DO) while the previous one has been replaced by the DOCG (controlled and guaranteed DO); ii) the name Prosecco has also been restricted to wine coming from that area only. This reform is supposed to further protect the value of Prosecco brand; however, dangerous threats have arisen since the Prosecco area have been signi cantly extended and the management of DOs is not yet clear. Theoretically, the theory of Clubs may give some hints in managing DOCG while the enforcement through a central authority may be the exit strategy for the management of new DOC. In this paper both hypothesis have been investigated. Results of NCP analysis con rm the signi cance of the Club for DOCG producers while forecasts about the increasing supply production and eects on prices are consistent with the tragedy of commons scenario. Eventually, the change in DOs should be accomplished by actions safeguarding the value of Prosecco as collective brand.

Keywords: Denomination of Origin; Goods; Club; Tragedy of Commons; Non Parametric Model; Prosecco (search for similar items in EconPapers)
JEL-codes: Q13 C18 (search for similar items in EconPapers)
Date: 2011-03, Revised 2011-10
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Published in Review Enometrica, March 2011

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