What has happened in the global wine industry is extremely interesting from a development point of view because the latecomers in the international market have radically changed how wine is produced, sold and consumed.

Up to the end of the 1980s, ‘Old World’ (OW) countries, and particularly France and Italy, dominated the international wine market. Since the beginning of the 1990s, their supremacy has been challenged by new international players, who are recording spectacular performance in terms of both exported volumes and values. These ‘New World’ (NW) countries include affluent frontrunners that are relatively new to the wine sector, such as USA and Australia, and less developed but rapidly growing latecomers such as Chile, Argentina and South Africa.

Roberta Rabellotti, professor of economics at the University of Pavia, argues that the spectacular performance of emerging markets is not explainable with the traditional “catching-up theories” of development. Rather, things changed thanks to the opening-up of new windows of opportunity in the industry.

 the traditional catching-up theories fall short in explaining what has occurred in the global wine industry, as they treat developing countries as non-innovators and contend that their catching up is possible essentially through the import of frontier technologies and/or organizational business models from the advanced forerunner countries (Abramovitz, 1986). As opposed to this, what has happened in the wine industry is an excellent empirical illustration of Perez and Soete’s (1988) windows of opportunities opening up for lagging countries at times of relevant discontinuities.

  a first significant window of opportunity in the sector opened up in the 1970s, as UK regulations changed and allowed supermarkets to retail wine, giving rise to a new market dominated by the baby-boomers. This new market boosted Australian wine production and exports and was followed by a radical transformation in wine demand, which included consumers from countries where wine has never been a traditional beverage, such the UK, the USA and the European Nordic countries.

 … While most of the rhetoric about innovation systems in developing and emerging countries is that weak linkages characterize them, what has happened in the wine industry shows the opposite. Both in Chile, Argentina and South Africa firms have managed to create a web of relations that has positively affected the sector’s product and process upgrading. Besides universities, intermediary bodies play a role in connecting firms to new technological knowledge.

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