ECO/535: The Digital Economy - Economic Concentration Evaluation

Introduction The California Winemaking Industry has become a multi-million dollar industry and is a prime example for economic concentration. For most of the history of wine, it has only come from specific countries and regions. Only within the last century have American makers become contenders world-wide with the discovery of grapes and techniques, thanks to the efforts of California wines in the a world-wide competition. Wine making in the United States has become a $220 billion industry (Wine Industry Network Advisor, 2017). With a presence in all 50 states, over a million employees, wages exceeding $75 million, and the generation of over $36 billion in taxes, one can see that the wine industry is a powerful force in the nation’s economy (Wine Industry Network Advisor, 2017). Evolution of Central California Winemaking Industry American’s have been making wine since the early 1800’s. The first official winery was founded in Ohio in 1830 with the discovery of the Catawaba grape (Baiocchi, 2011). Within 30 years, New York had its first winery and within another 20 years, a second (Baiocchi, 2011). Thirteen years of prohibition took a toll on the winemaking business. Prior to prohibition, there were approximately 2,500 wineries in the United States. By the time prohibition was lifted only 4% of the wineries were still operational (Baiocchi, 2011). Forty years later, it took a wine competition in Paris for the world to realize that Californ