The Sophistication of International Wine Trade: A New Import Measure

This paper investigates the international wine trade based on a new sophistication index (called C-Consy) focused on import flows. We posit that the sophistication level of destination countries provides relevant information on the kind of competition a product is going to meet in the final market. The sophistication level for the clients of the major world exporters is assessed for the 2006/07–2016/17 timespan. The main results of our analysis can be summarized as follows: (a) as expected, the category of bottled wines is more sophisticated than the one of bulk wines. However, for some exporters the destination markets for the latter are, indeed, more sophisticated; the C-Consy for sparkling wines varies widely across the destination markets of the main exporters here analyzed, suggesting a variety of different uses; (b) Products sold by the Old Wine World are generally more sophisticated, this is particularly true for Italy and France together with New Zealand which belongs to the so called New Wine World; (c) some exporters differentiate their destinations widely, especially according to wine items, while others concentrate their set of clients in the search for synergies.