Wine economics

Sunday, April 23, 2006

Opening remarks

This blog is concerned with the economics of wine. Wine is an interesting product. It is highly heterogenous, traded over long distances, embedded in local culture in some regions and dispised by other cultures, its production methods range from traditional to high-tech, governments regulate, subsidize and tax its production and consumption, and, most importanly, many people enjoy it but have difficulty to describe meaningfully what it is they enjoy with a glass of wine.

Wine is at the same time a fairly simple product - fermented juice of vine grapes. and a highly complex product - an intoxicating drink produced by a process that is difficult to control and that yields a product which is in demand for its observable chemical and physical characteristics as well as for some unobservable, metaphysical characteristics. From an economics perspective, wine can sometimes be approached like any other commodity, e.g. wheat, corn, or pork bellies, and sometimes it is better approached like a rare piece of art. The complexities of wine make it, im my mind, a perfect product to apply and test economic ideas.


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