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Modeling Grape Price Dynamics in Mendoza: Lessons for Policymakers

Author

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  • Puga, German
  • Fogarty, James
  • Hailu, Atakelty
  • Gennari, Alejandro

Abstract

Mendoza is the main wine-producing province of Argentina, and the government is currently implementing a range of policies that seek to improve grape grower profitability, including a vineyard replanting program. This study uses a dataset of all grape sales recorded in Mendoza from 2007 to 2018, totaling 90,910 observations, to investigate the determinants of grape prices. Key findings include: smaller volume transactions receive lower-average prices per kilogram sold; the discount for cash payments is higher in less-profitable regions; and the effect of wine stock levels on prices is substantial for all varieties. Long-run predicted prices are also estimated for each variety, and region; and these results suggest that policymakers should review some of the varieties currently used in the vineyard replanting program. (JEL Classifications: Q12, Q13, Q18)

Suggested Citation

  • Puga, German & Fogarty, James & Hailu, Atakelty & Gennari, Alejandro, 2019. "Modeling Grape Price Dynamics in Mendoza: Lessons for Policymakers," Journal of Wine Economics, Cambridge University Press, vol. 14(4), pages 343-355, November.
    • Handle: RePEc:cup:jwecon:v:14:y:2019:i:4:p:343-355_1
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    More about this item

    JEL classification:

    • Q12 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Micro Analysis of Farm Firms, Farm Households, and Farm Input Markets
    • Q13 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Agricultural Markets and Marketing; Cooperatives; Agribusiness
    • Q18 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Agricultural Policy; Food Policy; Animal Welfare Policy

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