Wine prices in the Nordic countries: Are they lower than in the region of origin?

The Centre was established in 1989 by the Economics Department of the Adelaide University to strengthen teaching and research in the field of international economics and closely related disciplines. Its specific objectives are: • to promote individual and group research by scholars within and outside the Adelaide University • to strengthen undergraduate and postgraduate education in this field • to provide shorter training programs in Australia and elsewhere • to conduct seminars, workshops and conferences for academics and for the wider community • to publish and promote research results • to provide specialised consulting services • to improve public understanding of international economic issues, especially among policy makers and shapers Both theoretical and empirical, policy-oriented studies are emphasised, with a particular focus on developments within, or of relevance to, the Asia-Pacific region. Adelaide for helpful data assistance. Also we are grateful to a large number of Danish importers of Australian and Californian wines who most kindly have given us access to their prices. The aim of this paper is to analyse the retail prices on wine in different countries. In general, country-specific price differences on identical wines are expected to reflect differences in taxes, import prices, transportation and other costs. Also the competitive conditions on the retail markets in the relevant countries are important. Accordingly, lack of competition at the retail level, high import prices and high duties on wine all contribute to increase wine prices. Next, consumer prices on wine are expected to be relatively lowest in the producer country and even lower on the local markets in the producing region. The Nordic countries are located far away from overseas wine producing countries, i.e. Australia and California and they all tax wine higher than in the producing country. Finland, Norway and Sweden have state monopoly in the retail trade of wine and spirits whereas the sales system for wine in Denmark is liberal and in line with the Australian and Californian system. Based on price information at the retail level, the paper analyses the logic of the relative prices on identical Australian and Californian red wines bought in Australia and California compared to Denmark, Finland, Norway and Sweden.