Epsilon Archive for Student Projects

Abstract

The objective of this thesis is to investigate the global competitiveness of Italy and France with respect to the other major representatives of the global wine market, Argentina, Australia, Chile, South Africa, Spain, and the USA between 1995 and 2019. The analysis is conducted using the Balassa and the Lafay Index of Revealed Comparative Advantage. Both indexes are then studied through a stability analysis between two periods (1995-2006 and 2008-2019). Following previous literature on competitiveness of the wine sector, Italy, France and Chile are expected to be the leaders in exports’ value of wines. The major findings of this thesis are that the global scenario is becoming more fragmented and complex, with Italy and France threatened mostly by Chile’s competition in each subsector: bulk, sparkling, and bottled wines. Italy became more competitive over time, thanks to the leadership gain in the low, and especially medium end market. France managed to increase the value of their wines, at expenses of productivity, export volumes but especially value shares on the global market. In many cases the Balassa index and the Lafay index revealed completely different results, especially during the specialization stability analysis in the three subsectors that saw France, Italy and Chile strongly competing. However, both indices highlighted some issues, like heterogeneity across countries that results easily susceptible to the limited number of parameters that are taken into account for calculations.