Explaining World Wine Exports in the First Wave of Globalisation, 1848-1938

The objective of this article is to analyse the determinants of world wine exports in the first wave of globalisation, taking into account the principal exporting countries and using an extended version of the gravity model. Our results show that ordinary wine exports were not affected by the increase in the size of the markets of the consuming countries, as in most of them wine was an alcoholic beverage consumed by a very small minority of the population. The harvests of the producing countries, particularly in the preceding years, significantly and positively affected their exports. And inversely, the harvests of the importers harmed them as there was a home bias in consumption due to cultural, price or tariff protection reasons. Finally, in the inter-war period, the trade of wine was severely affected by a series of shocks such as the First World War, the Soviet revolution, the Prohibition and the 1930s depression. As was the case for trade as a whole, the fall in transaction costs favoured exports, at least those of lower priced and lower quality wine. However, the liberalisation of trade had a lesser impact on wine than on other products.