Wine Cycles in South Africa

Abstract

In this article, medium-run cycles in wine production in South Africa are extracted and related to similar cycles in real GDP per capita during the same period. In addition to removing noise in the historical data, smoothing out short-run fluctuations also eliminates the short-run impact on agricultural production due to idiosyncratic shocks such as weather events, wars, and vine diseases. By isolating the medium-run cycles, it is possible to verify the timing and duration of each cycle, matching it with the historical narrative. In this regard, a 300-year annual data series of South African wine production explains the evolution not only of one of the largest agricultural sectors, but of the South African economy in general. (JEL Classifications: C10, N57, Q10).

Slave labor productivity and wine output: Stellenbosch, 1680–1828

“…The system of slavery at the Cape locked wine farmers into a production system that discouraged innovation and improvement. More substantial shifts in the traditional methods of wine farming would not occur until the end of slavery in the 1830s and, perhaps more significantly, until the arrival of the phylloxera disease in the late 19th century (Nugent, 2023;Vink et al, 2018).…”

“…Adam Smith, in his Wealth of Nations , noted that “slaves, however, are very seldom inventive; and all the most important improvements, either in machinery, or in the arrangement and distribution of work which facilitate and abridge labor, have been the discoveries of freemen.” The system of slavery at the Cape locked wine farmers into a production system that discouraged innovation and improvement. More substantial shifts in the traditional methods of wine farming would not occur until the end of slavery in the 1830s and, perhaps more significantly, until the arrival of the phylloxera disease in the late 19th century (Nugent, 2023; Vink et al., 2018).…”

Introduction to the Issue

“…In "Wine Cycles in South Africa," Nick Vink, Willem H. Boshoff, Johan Fourie, and Rossouw van Jaarsveld (Vink et al, 2018) shed some light on the economic history of the wine industry in South Africa. Drawing on several sources, the authors first construct a harmonized production time series starting in 1700.…”