OLD AND NEW PRODUCING COUNTRIES IN THE INTERNATIONAL WINE MARKET, VICENTE PINILLA 1

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1 IEHC 2006 Hesinki Session 117 OLD AND NEW PRODUCING COUNTRIES IN THE INTERNATIONAL WINE MARKET, VICENTE PINILLA 1 1. Introduction The purpose of this article is to analyze the international wine market between 1850 and Our thesis is that from the middle of the nineteenth century, Southern European wine production responded rapidly to the opportunities that were opening-up in the markets of the industrialized nations, and in the French market in particular, by increasing both their production and export of wine. For some of these countries this increase was crucial to balance their foreign accounts. However, from the beginning of the twentieth century, wine exports encountered increasing problems, such as a relatively unstable demand and a tendency towards the saturation of the market. These problems were primarily due to three factors: first, French trade policy gave preference to wine imports from its colonial possessions in North Africa; secondly, the industrialized countries, (excluding France) had a low capacity to absorb wine due to the persistence of traditional consumption habits with respect to alcoholic beverages, together with a strong prohibitionist tendency against the consumption of alcohol that reached its peak in the United States; finally, the emergence of significant competitors in other continents, meant that the opportunities for expansion on the part of the Southern European producer were limited. As a consequence, although wine exports had, in the second half of the nineteenth century became a crucial source of foreign currency for the developing countries of Southern Europe, the growth, or even the stability, of these exports during 1 Department of Applied Economics and Economic History, Faculty of Economics and Business Studies, University of Zaragoza, Gran Vía 2, Zaragoza, Spain. 1

2 the first third of the twentieth century was very difficult. This limited the opportunities of the wine sector to contribute significantly towards the economic development of these countries. 2. World consumption of wine: evolution and geographical patterns of consumption Wine consumption developed very differently in the various countries from the second half of the nineteenth century until the Second World War. Wine consumption grew mainly in those countries in which a tradition of such consumption already existed. In France per capita wine consumption more than doubled between 1860 and the years prior to the First World War. As a result, France became the country with the highest per capita wine consumption in the world. The French case shows how the increase in wine consumption in those traditional consumers countries was mostly determined by the growth in per capita income. Through the estimation of a per capita consumption function for wine corresponding to this country for the period , we have obtained an elasticity of consumption with respect to income in the long-term of 0.91; in other words, during these years each 1% increase in income translated into a per capita increase in consumption of 0.91%. Whilst this elasticity is relatively high bearing in mind that we are dealing with a good from the food and drinks group, it is nevertheless significantly lower than that of products which, within the same group, exhibited higher elasticity, namely fruits 2. In the rest of the world, wine consumption grew in those countries that received immigrants from Southern Europe. Everywhere else, the increase in wine consumption was either not large or simply did not occur. In the industrialized countries (excluding France), with higher per capita incomes, the increase in consumption was significant, especially in the decades after 1850, although later that trend did not continue. In the remaining backward countries of the world, the absence of wine consumption, or its restriction to a petty minority of European origin, continued. Accordingly, we can conclude that in the high-income level countries where wine was not the most important alcoholic beverage, its consumption grew in the first decades 2

3 of the second half of the century; thereafter and until 1930, it consumption stayed almost constant 3. By contrast in those countries in which wine was a product of mass consumption, its consumption per head grew until the 1920s. As a consequence of the evolution of consumption during this period, as well as of the level from which it started in the mid-nineteenth century, the world consumption of wine in the 1920s was concentrated in Europe 4. With respect to those countries for which we have sufficient data, we can classify these in function of their level of consumption, at the same time taking into account the consumption corresponding to beer. To that end, and using cluster analysis in order to separate the different countries into groups, we have obtained the results set out in Table 1 5. INSERT TABLE 1 The first group, a very well defined cluster formed by three countries in the Mediterranean region of western Europe, includes the main per capita wine consuming countries, with their per capita annual wine consumption averages around 100 liters. As we will see later, these three countries were, until the Second World War, the chief world wine producers. By contrast, beer consumption in those countries was very small (Italy and Spain) or only moderate (France). The second cluster includes countries in which wine consumption reaches a medium level and beer consumption is very variable. The moderate wine consumption in Greece can be attributed to its very low income. In Switzerland, the medium level wine consumption and medium-high level beer consumption can be attributed to its division between the German, Italian and French speaking parts, each with their different cultural traditions. Finally, the Argentinean case is characteristic of a country with Italian and Spanish immigrants who are used to the consumption of wine. 2 Pinilla and Ayuda (2004). 3 These observations and those that follow are based on data on the evolution of per capita alcoholic beverage consumption in the different countries between 1885 and 1930, taken from the Annuaire Statistique de la France (1938). 4 At the beginning of the 1930s, European wine consumption reached 83 per cent of total world consumption. Its per capita wine consumption level was almost five times the world average (International Institute of Agriculture, 1944, pp. 30 and 56). 5 A description of the technique employed, as well as more details on its interpretation, can be found in Aparicio, Ayuda and Pinilla (2001), pp

4 The third cluster comprises countries in which wine consumption is of a low level and, in general, with the exception of Austria, beer consumption is very low. These are countries with a certain wine tradition and with a national production of wine that is, not, as a rule, sufficient to supply the country. With respect to Hungary, Bulgaria and Romania, account should be taken of the medium-low income level of the first and the very low-income level of the second and third. By contrast, Austria had a high-income level and therefore its high beer consumption signified that beer was the dominant alcoholic beverage. Finally the rest of the Anglo-Saxon, Germanic, Scandinavian or Slavic countries consumed very small quantities of wine. Among them, we find the Anglo-Saxon and Germanic countries, which had high beer consumption, Scandinavian countries with a medium level beer consumption and the Slavic countries, in which beer was not important because the consumption of spirits was preferred. In consequence, we can conclude that only in a small corner of the world, namely the countries abutting the Northwestern shore of the Mediterranean, was wine considered to be a product of mass consumption. This was the case in Portugal, Spain, France, Italy and French and Italian speaking Switzerland. Only in a few other countries was this consumption of some significance, that is to say in Argentina, Uruguay, Chile, southern Brazil and Greece. In the rest of the world, if wine was consumed at all, it was the highincome classes. In 1932, an official British report expressed the same view in this way: today, except in the wine producing countries, wine is a luxury beverage chiefly connected with the ritual of entertainment 6. The evolution of wine consumption from the mid-nineteenth century until the outbreak of the Second World War, together with the levels finally reached in the most developed countries, suggests that the attractive demand-side prospects that had existed from the first of these two dates had tended to evaporate during the first third of the twentieth century. In some developed countries, the rapid development of wine imports, as a consequence of the general increase in international trade, slowed down as imports encountered the difficulties noted earlier. In the less developed countries, wine imports 4

5 were never relevant. Among the traditional consumers, the strong accumulated increase in consumption tended to reach high levels, which thereafter made it difficult to achieve more than small additional increases. Finally, the slowing of population growth also induced a gradually slower growth in the demand for wine, even for identical levels of per capita consumption. Therefore, two kinds of wine demand existed. First, the demand for high quality wine coming mainly from the high income sector within the industrialized countries; and secondly, the demand for low or medium quality wines coming from the population in the countries where wine was a product of mass consumption. In the latter, the strong demand for wine usually coexisted with high domestic production World production of wine During the period under study the world production of wine grew at a relatively slow rate when viewed in the long-term. It can be estimated that between and world wine production grew by 65.7%, which implies an annual growth rate of 0.8%. This rate was very similar during both the second half of the nineteenth century (0.7%) and in the first third of the twentieth (0.8%) 7. In the mid-nineteenth century, wine production was pre-dominantly located in the main consumption areas. In , just three countries; France, Italy and Spain, accounted for 85% of world wine production. France alone produced 49%. No other country reached even 3% of world production. However, various developments in the second half of the nineteenth century notably transformed wine production and trade. From among them, the most important are the following: the several outbreaks of vine diseases that affected the European vineyards, the improved conditions in wine handling that permitted its preservation over a longer period, and, above all, the improvements in transportation, because of both shorter routes and the decline in costs. 6 Imperial Economic Committee (1932), p. 10. This was echoed at the end of the same decade by the United States Tariff Commission (1939): In the United States, with the possible exception of California, wine is generally considered a luxury, and its consumption is limited to special occasions, p Wine production data in the second half of the nineteenth century are taken from Morilla (1995, p. 303). Table 2 shows our reconstruction of production in the twentieth century. 5

6 In addition, and as argued earlier, the process of industrialization and its strong economic and social impact meant, an increase in wine consumption and, in consequence, a higher demand chiefly in the traditionally consuming countries. Similarly, the strong growth in the population translated into a larger number of consumers. All of this acted as an incentive to increase wine production. The spread of phylloxera through the European vineyards had some relevant consequences for the world production of wine. Fundamental amongst these was that France, the principal wine producer and consumer, was one of the first countries to suffer the outbreak. Some countries took advantage of the French demand for wine imports and of high wine prices to experience an authentic, but short-lived, golden age. These countries specialized in the supply of the French market, and in order to take advantage of the situation, they expanded the area under wine cultivation and hence its production. This was the case in some Southern European countries, like Spain, Portugal, Italy and Greece. In the Spanish case, which became the main supplier of the French market during those years, some of its regions experienced a spectacular increase in wine production, thanks to French demand. This was particularly so for those regions closest to France, or well located near the ports so that they could export their wine. Other countries took advantage of the fall in French production to develop their own vineyards, even in areas where a previous tradition of wine farming did not exist although a tradition of wine consumption did. This was the case in some South American countries. In Algeria, a French colony at the time, the metropolitan government used two policy measures to encourage French settlers to produce wine: first, by forming a customs union with the colony in 1884, one that guaranteed the entry of wine into metropolitan France free of duties and under equal conditions to those enjoyed by continental production; secondly, through a policy of cheap credit for the production of wine agreed to between the French Government and the Bank of Algeria which, in exchange, preserved its right to issue currency between 1880 and 1897 (Isnard, 1954, pp ). Consequently, at the beginning of the twentieth century vine cultivation found itself in clear expansion. Alongside the traditional Mediterranean producers, and the 6

7 increasingly important Algerian vineyards, we must add the vineyards of other non- European countries, i.e. Chile, Argentina, California, South Africa or Australia. Their effect on world wine production is clear. Between 1870 and 1900 world wine production grew by an estimated 22%. This growth was induced not only by external demand, but also by the strong increase in domestic demand in the consumer countries, whether traditional or new. Thus, we can note that this increase in production was common to almost all producer countries except for France, which had not yet recovered from the phylloxera. In subsequent years, the outbreak was to affect almost all these countries. The earlier French experience in the fight against phylloxera and the good expectations from the demand side impelled rapid reconstitution of the damaged vines. From the point of view of production, it is necessary to indicate the significant changes that took place in wine growing due to the impact phylloxera. All the grapevines affected by phylloxera had to be replanted with American vines, which required increased care, leading an increase in production costs. In summary, the post-phylloxera wine growing sector needed larger amounts of capital in order to prosper (Unwin,1991). The existence of serial statistical data on world wine production for the first third of the twentieth century allows us to study its evolution in detail (see Table 2). Using such data, we estimate that wine production grew by 31% from the beginning of the century to the end of the 1930 s. INSERT TABLE 2 AND FIGURE 1 & 2 In the first third of the twentieth century, the largest increases in wine production took place in countries with very low earlier production levels. These countries had propitious climatic characteristics, farmers capable of developing the cultivation of wine (very often immigrants) and internal markets (or metropolitan in the case of some colonies) with a sufficient tradition in the consumption of wine as to absorb heavy increases in its production. Thus, the diversification of world wine production grew considerably. The growth of production in the Maghreb (mainly in Algeria) and in South America (mainly in Argentina) was especially significant. These two regions more than doubled their share in world production, which meant that they multiplied their production by almost three in absolute values. Meanwhile, the share in world production of the traditional large 7

8 producers declined. Therefore, France and the Southern European countries lost relative positions in world production and encountered difficult years characterized by chronic overproduction and declining prices (Pujol, 1986; Pech,1975). The short-run rigidity of supply with respect to price variations, together with the instability of harvests, a common feature of many other agricultural products, can help us to understand these problems. The increase in production took place mainly because of the growth in yields per hectare and, to a lesser degree, because of the expansion of vineyards in some countries. This can be explained by the changes in the cultivation practices that took place after the phylloxera outbreak, changes that meant greater care being given to the vines and the use of more modern techniques. Variations in wine supply, both quantitatively and geographically, were very closely linked to the changes in consumption, and to the opportunities that international trade offered to some producers. As we will see in the following section, world markets were, mainly during the nineteenth century, a driving force for the development of wine production in some countries, especially those located in the Mediterranean basin The international trade in wine The international trade in wine had very little importance around the middle of the nineteenth century. The main obstacle to wine diffusion to distant areas from the producing regions did not lie exclusively in cultural reasons, but also had to do with difficulties in transportation. The transport of ordinary wine was not profitable, due to problems in preserving wine during long distance trips and the high cost of such transportation. Thus, the only trade that existed was in products that traveled better, such as liquor wines (i.e. sherry, port or similar products), table wine fortified with alcohol to keep it in good condition, and high quality wine. The increase in the wine trade took place as both problems (transportation costs and conservation) were being solved. Furthermore, international trade liberalization and the commercial policy embodied in trade agreements that began in 1860 facilitated the increase in wine exports. During the second half of the nineteenth century, the main factor underlying the growth in the international wine trade was the huge French demand for table wine, due to the phylloxera that had affected the French vineyards. Usually, France demanded low 8

9 quality wine to meet its national consumption needs and, to a lesser extent in order to be able to maintain its exports. The increase in French demand caused an immediate rise in wine prices, which encouraged an important growth in Italian and Spanish exports in the short-run and in Algerian exports in the medium run 8. Italian exports were stopped from 1888 by the onset of the trade war between France and Italy (Loubere, 1978, p. 273). Initially, the increase in Spanish wine exports to France was very significant. Because of this rapid growth, the share of Spanish wine exports in relation to total exports, and to total agricultural exports in particular, was very high (Gallego and Pinilla,1996; Pinilla and Ayuda, 2004). However, in the medium-run, the strong expansion of Algerian production progressively replaced Spanish wine. From 1892, Spanish wine encountered tariff difficulties as its favorable treatment ended. INSERT TABLE 3 We can conclude that there were two main forces driving the wine trade during the second half of the nineteenth century: first, for ordinary table wine, the French demand that followed the phylloxera outbreak; secondly, for high quality wine, the demand coming essentially from countries with the highest income levels, such as Great Britain or the United States, where the wealthiest incomes groups demanded this product. As Loubere stated wine was a privileged drink of the privileged class and... wine remained a kind of ideal beverage, a sign of social standing and wealth, or at least of pretension to high status... The general increase of wealth and well being that began in the 1850s amply proved this, for the consumption of wine went up (Loubere, 1978, pp ). It was precisely the permanence of this privileged pattern of consumption, and the preference of the working and medium classes for beer and spirits, that represented the main obstacles for a subsequent extensive growth in the wine trade. It was the countries of Southern Europe, mainly Spain, and Algeria, that benefited most the increase in the French demand for wine with a high alcoholic content and low quality. This wine was normally mixed with French wine. In the high quality segment, 8 French table wine imports jumped from 200,000 hectoliters in the 1860s to almost 11 million at the end of the 1880s. 9

10 France was the main beneficiary of the expansion in demand. doubling the value of its exports of table wine between 1855 and During the first third of the twentieth century, the French demand for wine, and thus its imports offered the greatest capacity to generate increases in world wine exports. By contrast, and as we will see below, the rest of the markets suffered a clear stagnation during these years. Between and the wine trade grew by around 20% and French wine imports grew by 65%. Without France, the international wine trade would have dropped by around 13% (see table 4). INSERT TABLE 4 The 1929 crisis caused the international wine trade to fall by 5.6% between and Once again, France and the growth in its imports during that period, lessened the fall. During the 1930 s, as Loubere indicated, there was simply too much wine, good and bad, for buyers who lost their jobs or who feared losing them (Loubere,1990, p. 30). Logically, the economic situation of the wealthiest groups was not itself blooming and increased protectionism did not make things any easier. In summary, during the first years of the 1930 s, bumper harvests, both in large-scale producers such as France, as well as in countries in outside Europe that had been expanding their vineyards for years, coincided with the economic difficulties of the decade and the resulting fall in the demand. The result was an extremely saturated international wine trade. Accordingly, during the first third of the twentieth century, the wine output of the majority of wine producers was directed towards their own national markets. The seven biggest wine producers exported between 10% and 15% of their total yield. If the clearly export oriented Algeria is excluded, those percentages diminish to less than half. Between 1900 and 1938, the total amount of wine traded was around 10% of world production 9. The end of phylloxera in France did not bring about the end of wine imports or their retreat to pre-phylloxera levels; instead, they were maintained at a high level. The use of hybrids, which resulted in wines of very low strength and which could thus not be 10

11 sold directly, led to the perpetuation of the quantities of imported wine and their subsequent increase. The solution was to mix this weak wine with Spanish or Algerian wines that had a higher alcohol content, making the wine easier to sell (Loubere,1978, p. 299; Lachiver,1988, p. 453). Algerian exports progressively, lost their complementary character with French production, and ended-up competing with it (Pech, 1975, pp ). Access to the French market was not equally easy for all countries. The main distorting element was French trade policy and the privileged access granted to Algeria and the rest of the French colonies in North Africa, for which the French market was tariff-exempt. Thanks to the growth of Algerian exports to France, the African continent, and Algeria in particular, became the main wine exporting area in the world. Therefore, Africa took over Europe s position as the main exporter in the international wine trade (table 4). Spain was the second wine exporter at the time. The Spanish case exemplifies the difficulties encountered by the rest of the wine exporters in competing with Algeria. The French market was without doubt the biggest importing market in the world (see table 4). We should therefore conclude that, the discriminatory French policy greatly limited the possibilities for expanding the wine exports on the part of the Southern European countries. As an illustration, during the first third of the twentieth century, Spanish wine exports to France never reached one third of the peak achieved in the 1880s. Before 1875, Algerian exports to France were zero, but thereafter they grew. In they reached million hectoliters thanks to favorable French policy. Without the existence of this policy, Southern European wine exports would have probably expanded in parallel with the increasing French demand. Therefore, the decrease or stagnation in the export of ordinary wine from some of the Southern European countries from the beginning of the twentieth century was not due to stagnant French demand, but rather to French trade 9 Percentages for other significant products were highly variable (Aparicio, 2000): around 19% of world wheat production was exported; the percentages for barley varied between 9 and 15%; the percentage for corn was around 8%; for sugar between 40 and 50%; and for cotton between 50 and 70%. 11

12 policy and the support of the French government for the growth of wine production in its North Africa colonies (table 3) 10. In addition, it should be taken into account that French demand fluctuated greatly, depending on domestic production, and that these fluctuations were most damaging for the exports of the Southern European countries. However, the problems faced by these countries extended well beyond the situation of the French market. They encountered growing competition in the rest of the markets in a commodity for which demand was stagnant. They responded by trying to expel French wine from the lower quality segments, while France maintained its predominance in the higher quality segments. Simultaneously, the increase in production in countries with no, or very little, wine growing tradition lowered their need to import wine, i.e. the development of the domestic production of wine in places such as Australia or South America implied a considerable decrease in their imports (Table 4). South American wine imports were almost 10% of total world imports before the First World War, but they decreased dramatically by the end of the period under study to only 0,78%. The production increases in these countries were achieved under the umbrella of strong tariff protection, which represented an obstacle to the entry of ordinary table wines coming from Southern Europe. Furthermore, the situation of the international wine market deteriorated as a result of the crisis that began in 1929 and the economic problems of the 1930s. All of this was magnified by the weak international trade that resulted from the strong increase in protective measures. The drop in consumption and the increased supply added to the difficulties faced by international trade. This increased supply resulted from consecutive good harvests during those years and from the added production of the new vines planted in the new producers countries( Douarché, 1930). Therefore, with the exception of Algeria, which benefited highly from its direct access to the French market, the first third of the twentieth century was not a boom period for the other wine exporters. On the contrary, these were decades marked by successive 10 In the Spanish case, there was a very big difference between the volume of ordinary wine exported between 1880 and 1900, and the much lower volume exported between 1900 and 1935 (Pinilla and Ayuda, 2002, p. 68). 12

13 situations of overproduction, unfavorable prices and, when viewed as a whole, a fall in exports. 5. Concluding remarks It is important to emphasize the distinct character that the consumption of wine had in the diets of the different countries, especially within the European countries. The opportunities to expand wine exports were considerably limited by the fact that wine was a mass consumption product in only a very small number of countries. In spite of this, during the second half of the nineteenth century an authentic golden age emerged for the expansion of wine exports. The expansion in the export of high quality wine was due to the growth in demand coming from the industrialized countries, whilst the strong expansion in the export of medium and lower quality wines was due to the problems that affected the French vineyards. These problems occurred in a period of rapid growth in domestic and international demand, which caused France to increase its imports of wine in order to meet both its growing domestic demand and its growing exports. In both cases, the improvements in land and maritime transportation and in the methods to preserve wine helped the expansion of exports. The lesser-developed countries of Southern Europe reacted quickly to these opportunities, which demonstrates that their wine growing and processing sectors were very sensitive to the signals sent by the market. The growth of liquor wine exports from Portugal and Spain to Great Britain, and of ordinary wine from Portugal, Spain, Italy and Greece to France, was spectacular. These favorable expectations for the wine industry partially explain the significant investments made by these countries to replant their vines after they had been devastated by phylloxera, an event which occurred only a few years after the outbreak affected the French vineyards. However, these expectations were over-shadowed by the change in French trade policy during the 1890s. Afterwards, not only did expectations fall, they actually worsened 11. In addition, the use of better techniques and new vines with greater 11 On the importance of French trade policy and that of other importers, see for Portugal, Lains (1995, pp ) and for Spain, Pan-Montojo (1994) and, Pinilla and Ayuda (2002). This would be a good example of Nye s view (1994, p.13), that the nature of tariff and tax policy in the West s leading 13

14 productivity generated a larger production that faced a market in which growth depended primarily on the expansion of French imports. French trade policy was favorable to its colonies, and especially to Algeria. This implied that it was difficult for the Southern European producers to compete with Algeria, therefore making it very hard to expand their exports. Furthermore, the international wine market was very unstable and without meaningful growth outside France, whilst the Southern European producers had to face the growing competition coming from the new overseas wine producers such as Argentina, Chili, South Africa or Australia. Finally, the collapse of international trade after 1929 dealt a deathblow to the hopes of Southern European producers. Conversely, Algeria experienced a growth in production and exports without parallel in the rest of the world. Consequently, during the first third of the twentieth century, wine exports were in general very unstable and faced unfavorable prices. In some countries wine exports dropped, whilst in others the rate of growth was much smaller than during the golden age. In the countries of Southern Europe, the excellent expectations generated during the nineteenth century for the development of the wine export sector tended to evaporate, as did the importance of their wine exports in foreign trade. Until the beginning of the twentieth century, the wine exports of these countries had contributed towards balancing their foreign accounts by financing the imports of manufactured goods, and had also stimulated economic growth through the benefits generated by these exports. However, from the beginning of the twentieth century, this contribution seriously declined. At this time, their specialization in the production and export of wine, for which these countries had a clear competitive advantage, revealed its limitations as a motor for agricultural development, the growth of the agri-food industry and the growth of exports. References APARICIO, G.; AYUDA, M.I.; and PINILLA, V. (2001). World consumption of Wine, : an obstacle to the growth of its production and trade?, J. Maldonado (ed.), Actas del I Simposio de la Asociación Internacional de Historia y Civilización de la Vid y el Vino, AICHCVV, El Puerto de Santa María, vol. II, pp economies imposed substantial economic costs on producer countries with comparative advantage in more heavily and more easily-taxed consumption items. 14

15 APARICIO, G. (2000). El comercio internacional de productos agrarios, , Ph. D. Dissertation, University of Zaragoza. BAIROCH, P. (1973). European Foreign Trade in the XIX Century: The Development of the Value and Volume of Exports (Preliminary Results). The Journal of European Economic History vol. 2, 1, BAKOUNAKIS, N. (1988). La vigne et la ville: qui finance la culture?, in G. Dertilis, Banquiers, usuriers et paysans. Paris: Fondation des Treilles / Editions la Découverte, DERTILIS, G. (1988). Résaux de crédit et stratégies du capital, in G. Dertilis, Banquiers, usuriers et paysans. Paris: Fondation des Treilles / Editions la Découverte, DOUARCHE, L. (1930). La crise viticole mondiale. Paris. FEDERICO, G. (1991). Oltre frontiera: L Italia nel mercato agricolo internazionale, in P. Bevilacqua, Storia dell Agricoltura Italiana in etá contemporanea, vol. III Mercati e Istituzioni, Venezia: Marsilio Editor, FEDERICO, G. (1992). El comercio exterior de los países mediterráneos en el siglo XIX. In Prados de la Escosura, L. and V. Zamagni (eds.). El desarrollo económico en la Europa del Sur: España e Italia en perspectiva histórica. Madrid: Alianza Editorial, FERNÁNDEZ-CLEMENTE, E. (1995). Ulises en el siglo XX. Crisis y modernización en Grecia, Zaragoza: Prensas Universitarias de Zaragoza. GALLEGO, D. and V. PINILLA (1996). Del librecambio matizado al proteccionismo selectivo: el comercio exterior de productos agrarios y alimentos en España entre 1849 y Revista de Historia Económica, año XIV, 2, and año XIV, 3, GRUPO DE ESTUDIOS DE HISTORIA RURAL (1987). Un índice de la producción agraria española, Hacienda Pública Española, 108/109, HANSON, J.R. (1986). Export Shares in the European Periphery and the Third World before World War I: Questionable Data, Facile Analogies. Explorations in Economic History 23, IMPERIAL ECONOMIC COMMITTEE (1932). Wine. Reports of the Imperial Economic Committee. Twenty-third Report, London. INTERNATIONAL INSTITUTE OF AGRICULTURE ( ). Annuaire International de Statistique Agricole, Rome. INTERNATIONAL INSTITUTE OF AGRICULTURE (1944). Agricultural Commodities and Raw Materials. Production and Consumption in the different parts of the World, ,Rome. ISNARD, H. (1954). La vigne en Algérie, étude géographique. Ophrys: Gap LACHIVER, M. (1988). Vins, vignes et vignerons. Histoire du vignoble francais. Lille: Fayard. LAINS, P. (1995). A Economia Portuguesa no Século XIX. Crescimiento Económico e Comercio Externo, Lisboa: Imprensa Nacional Casa da Moeda. LOUBERE, L.A. (1978). The Red and the White. A History of Wine in France and Italy in the Nineteenth Century. Albany : State University of New York Press. LOUBERE, L. A. (1990). The Wine Revolution in France. Princeton: Princeton University Press. MITCHELL, B.R. (1986). International Historical Statistics. Africa and Asia. London: Macmillan. MITCHELL, B.R. (1992). International Historical Statistics. Europe, London: Macmillan. MITCHELL, B.R. (1993). International Historical Statistics. The Americas, New York: Stockton Press MORILLA, J. (1995). La irrupción de California en el mercado de productos vitícolas y sus efectos en los países mediterráneos ( ). In MORILLA, J. (ed.), California y el Mediterráneo: Estudios de la 15

16 historia de dos agriculturas competidoras. Madrid: Ministerio de Agricultura, Pesca y Alimentación, NYE, J.V. (1994). The unbearable lightness of drink: British Wine Tariffs and French Economic Growth, Political economy of protectionism and commerce, eighteenth-twentieth centuries. Milano: Proceedings Eleventh International Economic History Congress, OFFICE INTERNATIONAL DU VIN ( ). Annuaire International du Vin. Paris. PAN-MONTOJO, J. (1994). La bodega del mundo. La vid y el vino en España ( ). Madrid: Alianza Editorial. PECH, R. (1975). Enterprise viticole et capitalisme en Languedoc-Roussillon: du Phylloxera aux crises de mevente. Toulouse: Publications de l Université de Toulouse. PINILLA, V. and M.I. AYUDA (2002). The Political Economy of the Wine Trade: Spanish Exports and the International Market, , European Review of Economic History 6, part.1: PINILLA, V. and M.I. AYUDA (2004). Right shifts of the demand curve and international trade in Mediterranean agricultural products, , mimeo. PUJOL, J. (1984). Les crisis de malvenda del sector vitivinícola catalá, , Recerques, 15, UNITED STATES TARIFF COMMISSION (1939). Grapes, raisins and wines, Report No Second Series. UNWIN, T. (1991). Wine and the vine. An historical geography of viticulture and the wine trade. London: Routledge. Appendix : Sources and calculation method for world wine production (table 2) We have made our calculation of world wine production on the basis of data collected from the International Institute of Agriculture ( ). Data missing from the above source has been completed using the following sources: Mitchell, B.R. (1986), (1992) and (1993); United States Tariff Commission (1939); and Office International du Vin ( ):Annuaire International du Vin. Paris. Data that could not be obtained from any of the above sources has been estimated as an average of the available data on previous and subsequent years. The percentages of estimated production of total world production in each period are:1.5 ( ), 2.8 ( ), 3.9 ( ), 3.5 ( ), 2.4 ( ) 1.0 ( ), 1.1 ( ), 4.9 ( ). 16

17 TABLE 1. PER CAPITA CONSUMPTION OF WINE AND BEER IN VARIOUS COUNTRIES, (five year averages) (PURE ALCOHOL IN LITERS) WINE BEER High wine ITALY consumption FRANCE countries SPAIN Medium wine ARGENTINA consumption GREECE countries SWITZERLAN Low HUNGARY wine BULGARIA consumption ROMANIA countries AUSTRIA Very YUGOSLAVIA low BELGIUM wine NORWAY consumption GERMANY countries CZECHOSLOV AUSTRALIA UNITED KIN DENMARK NETHERLAND IRELAND CANADA ESTONIA NEW ZEALA SWEDEN RUSSIA LATVIA LITHUANIA Source: Imperial Economic Committee (1932), p. 85.

18 TABLE 2. WORLD WINE PRODUCTION, ANNUAL PRODUCTION IN THOUSANDS OF HECTOLITERS (five year averages) The biggest World producers France 51,614 58,322 47,524 39,038 61,861 56,845 56,940 58,771 Italy 40,400 45,299 42,271 35,628 41,690 41,193 36,397 38,926 Spain 16,040 14,928 13,638 17,827 20,785 21,215 17,809 14,852 Algeria 6,078 7,657 8,120 6,856 7,834 11,052 17,338 16,838 Portugal 5,131 5,214 4,311 4,710 5,060 5,946 7,864 7,159 Argentina 1,708 3,028 4,597 4,435 5,718 6,098 5,139 7,395 Romania 1,156 1,608 1,295 1,930 4,345 6,384 8,233 9,438 The geography of wine production France 51,614 58,322 47,524 39,038 61,861 56,845 56,940 58,771 European Mediterranean Countries 63,429 67,985 63,422 61,481 73,327 74,445 69,066 68,722 Other European countries 16,439 18,520 12,869 12,549 14,071 15,628 22,131 23,966 OLD PRODUCING COUNTRIES 131, , , , , , , ,458 Algeria 6,078 7,657 8,120 6,856 7,834 11,052 17,338 16,838 Rest of Africa ,211 1,668 2,609 3,646 Asia North America 1,199 1,450 1,875 1, ,692 Argentina 1,708 3,028 4,597 4,435 5,718 6,098 5,139 7,395 Chile 1,185 1,808 2,318 1,863 2,213 3,001 2,470 3,451 Rest of South America ,466 1,388 1,477 Australia & New Zeland NEW PRODUCING COUNTRIES 12,057 15,990 18,991 16,660 19,129 24,539 30,498 36,563 TOTAL 143, , , , , , , ,022 Sources: see Appendix

19 FIGURE 1: WORLD WINE PRODUCTION, (thousands of hectoliters) Source: Imperial Economic Committee (1932), p World Wine Production Moving averages Sources: See Appendix

20 FIGURE 2: WORLD WINE PRODUCTION, (thousands of hectoliters) : OLD VS. NEW PRODUCING COUNTRIES OLD PRODUCING COUNTRIES NEW PRODUCING COUNTRIES

21 TABLE 3. FRENCH IMPORTS OF ORDINARY WINES IN CASKS Origin of imports (%) % of French Spain Algeria Others Production Source: Direction General des Douanes, Tableau du Commerce Exterieur de la France, , Paris.

22 TABLE 4. WORLD TRADE IN WINE, (Five year averages) WINE IMPOR Thousands of hectoliters Percentages of total world imports Germany 1, France 8,237 10,565 13,603 14, U.K Switzerland 1,561 1,364 1, EUROPE 13,079 15,375 17,696 16, USA N&C AMERIC Argentina Brazil S. AMERICA 1, ASIA AFRICA OCEANIA WORLD TOT 16,178 17,279 19,444 18, WINE EXPOR Thousands of hectoliters Percentages of total world exports Spain 3,106 4,078 3, France 1,978 1,664 1, Greece Italy 1,553 1,395 1,081 1, Portugal 1,082 1, EUROPE 9,406 9,412 8,129 4, N&C AMERIC S. AMERICA ASIA Algeria 6,764 7,939 10,876 12, Tunisia , AFRICA 6,951 8,470 11,627 14, Australia OCEANIA WORLD TOT 16,541 18,100 20,092 19, Source: Import and export averages made by the International Institute of Agriculture ( ), with the exception of the last one period which has been calculated by ourselves with the annual data.