Wine prices in the Nordic countries: Are they lower than in the region of origin?

Jan Bentzen and Valdemar Smith

No 2002-23, Centre for International Economic Studies Working Papers from University of Adelaide, Centre for International Economic Studies

Abstract: The aim of this paper is to analyse the retail prices on wine in different countries. In general, country-specific price differences on identical wines are expected to reflect differences in taxes, import prices, transportation and other costs. Also the competitive conditions on the retail markets in the relevant countries are important. Accordingly, lack of competition at the retail level, high import prices and high duties on wine all contribute to increase wine prices. Next, consumer prices on wine are expected to be relatively lowest in the producer country and even lower on the local markets in the producing region. The Nordic countries are located far away from overseas wine producing countries, i.e. Australia and California and they all tax wine higher than in the producing country. Finland, Norway and Sweden have state monopoly in the retail trade of wine and spirits whereas the sales system for wine in Denmark is liberal and in line with the Australian and Californian system. Based on price information at the retail level, the paper analyses the logic of the relative prices on identical Australian and Californian red wines bought in Australia and California compared to Denmark, Finland, Norway and Sweden.

Keywords: Wine prices; Californian wines; Australian wines; Wine taxes; The Nordic Market for wine (search for similar items in EconPapers)
JEL-codes: D4 L81 O57 (search for similar items in EconPapers)
Pages: 32 pages
Date: 2002-09
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