Australian Wine Industry Competitiveness: Why so Slow to Emerge?

20 Pages Posted: 4 Oct 2018

See all articles by Kym Anderson

Kym Anderson

University of Adelaide - Centre for International Economic Studies (CIES); Centre for Economic Policy Research (CEPR); Australian National University

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Date Written: October 2018

Abstract

Despite favourable growing conditions, Australia's production or exports of wine did not become significant until the 1890s. Both grew in the 1920s, but only because of government support. Once that support was removed in the late 1940s, production plateaued and exports diminished: only two per cent of wine production was exported during 1975–1985. Yet over the next two decades, Australia's wine production quadrupled and the share exported rose to two‐thirds – before falling somewhat in the next 10 years. This paper explains why it took so long for Australia's production and competitive advantage in wine to emerge, why it took off spectacularly after the mid‐1980s and why it fell in the 10 years to 2016. It concludes that despite the recent downturn in the industry's fortunes, the country's international competitiveness is now firmly established and commensurate with its ideal wine‐growing climate, notwithstanding the likelihood of further boom‐slump cycles in the decades ahead.

Keywords: boom‐plateau wine cycles, comparative advantage, wine competitiveness, wine trade specialisation

Suggested Citation

Anderson, Kym, Australian Wine Industry Competitiveness: Why so Slow to Emerge? (October 2018). Australian Journal of Agricultural and Resource Economics, Vol. 62, Issue 4, pp. 507-526, 2018, Available at SSRN: https://ssrn.com/abstract=3260104 or http://dx.doi.org/10.1111/1467-8489.12276

Kym Anderson (Contact Author)

University of Adelaide - Centre for International Economic Studies (CIES) ( email )

School of Economics
Adelaide SA 5005
Australia
+61 8 8313 4712 (Phone)
+61 8 8223 1460 (Fax)

Centre for Economic Policy Research (CEPR)

London
United Kingdom

Australian National University ( email )

Arndt-Corden Dept of Economics
Coombs Building
Canberra, AK ACT 2600
Australia
+61 8 8313 4712 (Phone)

HOME PAGE: http://publicpolicy.anu.edu.au/crawford_people/content/staff/acde/kanderson.php

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