Imports versus Domestic Production: A Demand System Analysis of the U.S. Red Wine Market
James Seale (),
Mary Marchant and
Alberto Basso
Review of Agricultural Economics, 2003, vol. 25, issue 1, 187-202
Abstract:
The U.S. wine market experienced rapid growth in all facets—production, consumption, exports, and imports—over the past decade. Red wine imports more than tripled while consumption of domestically produced red wines doubled. This research estimates demand elasticities of U.S. red wine imports from five countries accounting for over 90% of imports—Italy, France, Spain, Australia, and Chile—using the first-difference version of the almost ideal demand system (AIDS). These elasticities are compared with those for domestically produced red wine. Results for conditional expenditure elasticities indicate that the U.S. red wine industry gains over imports when U.S. consumers’ total expenditures on red wine increase. However, comparing own- and cross-price elasticities reveals an increase in the price of U.S. red wine results in a decline in quantity demanded six times greater than for French and Italian red wines and over 20 times greater than other import countries, thus harming the U.S. red wine industry. Empirical results suggest that U.S. red-wine producers could increase their total revenue by decreasing prices, while Italian and French producers can increase total revenues by increasing them.
Date: 2003
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (29)
Downloads: (external link)
http://hdl.handle.net/10.1111/1467-9353.00053 (application/pdf)
Access to full text is restricted to subscribers.
Related works:
Journal Article: Imports versus Domestic Production: A Demand System Analysis of the U.S. Red Wine Market (2003) 
Working Paper: Imports versus Domestic Production: A Demand System Analysis of the U.S. Red Wine Market (2002) 
This item may be available elsewhere in EconPapers: Search for items with the same title.
Export reference: BibTeX
RIS (EndNote, ProCite, RefMan)
HTML/Text
Persistent link: https://EconPapers.repec.org/RePEc:oup:revage:v:25:y:2003:i:1:p:187-202.
Ordering information: This journal article can be ordered from
https://academic.oup.com/journals
Access Statistics for this article
More articles in Review of Agricultural Economics from Agricultural and Applied Economics Association Oxford University Press, Great Clarendon Street, Oxford OX2 6DP, UK. Contact information at EDIRC.
Bibliographic data for series maintained by Oxford University Press ( this e-mail address is bad, please contact ) and Christopher F. Baum ().