Abstract
The wine Common Market Organisation has established two concepts for recognizing the quality of wines in the European Union (EU). The first corresponds to the so-called Protected Designation of Origin (PDO), and the second to the Protected Geographical Indication (PGI). The set of Spanish PDOs includes the subset of Spanish DOs (Designation of Origin), which have been recognized as quality wines by Spanish authorities since 1932. Spain accounts for 67 DOs but, due to a lack of data, only 34 of them are suitable for carrying out our analysis. We will analyze the efficiency of this subset for the 2008, 2009 and 2010 seasons resorting to Data Envelopment Analysis (DEA) and using a new additive based efficiency measure known as BAM (Bounded Adjusted Measure). Since we are using panel data, we will also evaluate the productivity associated with this data set resorting to Malmquist indexes. Our results show that the efficiency behavior of the subset of Spanish DOs is uniform over the time periods analyzed and that productivity experiments only minor and irrelevant changes. They also show that three DOs are in a very good competitive position while another three DOs are in a very bad position. We end up suggesting some economic reasons for explaining these results.
Highlights
Spain has the largest cultivated vineyard area in the world, it is not the largest wine producer; it is third after Italy and France
The study of Protected Designation of Origin (PDO) sheds light on the production of quality wines, a sector that is growing from year to year, being relevant to analyze the performance of such PDOs, in order to learn the main features of the best ones
Our Data Envelopment Analysis (DEA) models have allowed us to classify the 34 Spanish DOs considered according to their efficiency scores in each of the three seasons
Summary
Spain has the largest cultivated vineyard area in the world, it is not the largest wine producer; it is third after Italy and France. In order to increase wine sales, the offer must guarantee its quality. Since the 2008 European Union Commission Regulation on wine markets (OJ, 2008), quality is guaranteed in Spain for the Protected Designation of Origins (PDOs). In Spain, the number of PDOs has increased each year as well as the land associated with them. In the 2008-2009 season, 60% of the land with grapes belonged to PDOs, while in the 2009-2010 season, the percentage increased to 66.2%. The production of quality wines is associated mainly to PDOs. the study of PDOs sheds light on the production of quality wines, a sector that is growing from year to year, being relevant to analyze the performance of such PDOs, in order to learn the main features of the best ones
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