Abstract
The aim of this study is to investigate the long-term determinants of China’s imported wine demand and to forecast wine
imports from 2019 to 2023 using econometric methods. Auto-regressive distributed lag models are developed based on
neoclassical economic demand theory to investigate the long-term determinants of China’s demand for imported bottled,
bulk, and sparkling wine from the top five countries of origin. The empirical results demonstrate that income is the most
important determinant of China’s imported wine demand, and that price only plays a significant role in a few markets.
Substitute and complement effects are identified between wines from different countries of origin and between imported
wines and other liquids. China’s imported wine demand is expected to maintain its rapid growth over the forecast period.
Bottled wine will continue to dominate China’s imported wine market. France will have the largest market share in the
bottled wine market, Spain will be the largest provider of bulk wine, and Italy will hold the same position for sparkling
wine. This is the first study to use a single equation with the general to specific method rather than a system of equations
to estimate and forecast China’s demand for imported bottled, bulk, and sparkling wines from different countries of origin.
The more specific model setting for each country of origin improves forecasting accuracy.