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The demand for wine in ontario and the phasing-out of discriminatory mark-ups

Author

Listed:
  • Bruno Larue

    (Department of Agricultural Economics and Business, University of Guelph)

  • Alan Ker

    (Department of Agricultural Economics and Business, University of Guelph)

  • Lorrie Mackinnon

    (Ontario Ministry of Agriculture and Food)

Abstract

Two demand systems incorporating habit formation and time-varying parameters but using two different product differentiation schemes are estimated to analyze the demand for wine in Ontario and assess the effect of complying with a GATT ruling calling for the phasing-out of a 65% discriminatory mark-up differential between domestic and foreign wines. Four different scenarios by which Ontario could abide by the GATT ruling are simulated and compared. The scenario chosen by the Ontario government generates the most revenues but it also involves the largest decline in the demand for domestic wines.

Suggested Citation

  • Bruno Larue & Alan Ker & Lorrie Mackinnon, 1991. "The demand for wine in ontario and the phasing-out of discriminatory mark-ups," Agribusiness, John Wiley & Sons, Ltd., vol. 7(5), pages 475-488.
    • Handle: RePEc:wly:agribz:v:7:y:1991:i:5:p:475-488
    DOI: 10.1002/1520-6297(199109)7:5<475::AID-AGR2720070506>3.0.CO;2-Y
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    References listed on IDEAS

    as
    1. Alley, Andrew G & Ferguson, Donald G & Stewart, Kenneth G, 1992. "An Almost Ideal Demand System for Alcoholic Beverages in British Columbia," Empirical Economics, Springer, vol. 17(3), pages 401-418.
    2. Blanciforti, Laura, 1984. "Habits And Autocorrelation In The Almost Ideal Demand System Applied To Food," Staff Reports 276792, United States Department of Agriculture, Economic Research Service.
    3. Deaton, Angus S & Muellbauer, John, 1980. "An Almost Ideal Demand System," American Economic Review, American Economic Association, vol. 70(3), pages 312-326, June.
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    Cited by:

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    2. Antonis Michis & Anna Markidou, 2013. "Determinants of retail wine prices: evidence from Cyprus," Empirical Economics, Springer, vol. 45(1), pages 267-280, August.

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