Perestroika, Monopoly, Monopsony, and the Marketing of Moldovan Wine

Abstract

Moldova is one of the smallest constituent Republics of the C.I.S., with a population of just 4.3 million inhabitants. In agrifood terms however, Moldova has traditionally been one of the key “food baskets” for the rest of the former Soviet Union. Nowhere is this more marked than in the production of wine, with Moldova still supplying 20% of the total wine production of the former Soviet Union. In Central and East European terms the Moldovan wine industry is substantial; producing annually as much wine as Hungary and “Czechoslovakia” combined. This paper provides an overview of the Moldovan wine industry, highlighting key production and structural difficulties facing it as it attempts to gain access to hard currency earning markets outside the former Soviet Union. In particular, the problems caused by the recent reversion to the traditional monopoly‐monopsony structure within the Moldovan wine marketing channel are analysed. Suggestions are made for true liberalisation of the Moldovan wine marketing system, based upon three elements:‐ (i) De‐nationalisation, and a move to new private structures of ownership of Moldovan wineries; (ii) Modernisation of vineyard practices and production methods, driven by private incentive. (iii) The establishment of effective networks of marketing and distribution, based upon private wineries pursuing real markets.

Citation

Lamont, J.T.J. (1993), "Perestroika, Monopoly, Monopsony, and the Marketing of Moldovan Wine", International Journal of Wine Marketing, Vol. 5 No. 2/3, pp. 48-61. https://doi.org/10.1108/eb008617