set, more of these parameters became significant as
the decade proceeded.
When examining the regional dummies, notice
again that they become increasingly significant
over time, although the trend is more scattered and
less clear than in the Halliday sample. In the sample
the only region significantly different from the
Barossa Valley for the ‘92 vintage at the 5 per cent
level was Rutherglen, while for the 1998 and 1999
vintages about half the regions are significantly
different at the 1 per cent level. Again, this pattern
is an indication of an intensifying regional quality
differentiation in Australia, with coefficients trending
up or downward. Moreover, the Winestate data
confirm the strong upward trends for the newly
developing ultra-premium cool-climate regions (e.g.
Adelaide Hills, Mornington Peninsula and Tasmania).
(ii) New Zealand
The results for New Zealand, shown in Tables 7
and 8, differentiate 10 varieties and five regions in
each data set. (Absence of an entry means insufficient
or no observations.) The Chardonnay variety and
the region of Marlborough are chosen as the New
Zealand bases. A number of interesting results,
especially when compared with Australia’s, are
worth highlighting. For example, the parameters
for Halliday’s ‘vintage rating’ are all significant
and fairly constant over time, with somewhat lower
price premia for New Zealand as compared with
Australia. The coefficients vary between 1.1 and
2.7 per cent, which translate into price premia between
21 and 64 cents calculated at the average NZ price
for each vintage. The parameters for ‘winery rating’
also are mostly smaller and less significant for
New Zealand than for Australia, while the ‘classic
wine’ parameter is equally significant with the
premia ranging between 14 and 34 per cent.
Varietal differences are less pronounced in New
Zealand too. Note that Riesling is discounted by
about one-third and Sauvignon Blanc between oneseventh
and one-third relative to the base variety
(Chardonnay), whereas the reds enjoy considerable
premia, other things equal.
Most strikingly, however, are the differences in
the degree of regional differentiation between the
two countries. For New Zealand, only one out of a
total of 40 regional dummy coefficients over eight
vintages is significantly different from the base
region (Marlborough) at the 1 per cent level (plus
just four others at the 5 per cent level), and the
degree of difference is not large. Nor are any
trends in the size or significance of coefficients
obvious over time, unlike for Australia.