The competitiveness of French protected designation of origin wines: a theoretical analysis of the role of proximity

Abstract

The French model based upon the protected designation of origin (PDO) has been challenged since the beginning of the last decade by the one of ‘New World Wines'. Yet, not all PDO vineyards are equally affected, while some new world wines have in turn entered into crisis. We will consider the issue by comparing two French vineyards, Cahors and Chablis, according to the ‘economics of proximity' framework. We will first analyse the dynamics and strategies of the French wine industry according to the above-mentioned framework, detailing more precisely the terroir-based strategy. We will then apply it to our two case studies, in order to understand the challenges currently facing the French wine industry.