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Introduction GRAPE GROWING AND WINE MAKING IN THE EARLY SETTLEMENT PERIOD The American colonies were settled by immigrants from Europe. In most of the countries from which they came, grape growing and wine making were traditional parts of agriculture. A little over fifty years after English colonization began in Virginia, the first laws encouraging grape growing were passed. Enacted in 1639 by the Virginia Assembly, this first legislation required that "all workers upon corns and tobacco shall this spring plant five vyne plants per poi, and the next year


Contents A C K N O W L E D G M E N T S xi P R E F A C E : W H Y BOTTLED POETRY? xiii I N T R O D U C T I O N : NAPA A N D T H E N O T I O N OF W I N E Q U A L I T Y I 1 The Quality Producers, 1934-1940 7 2 Bulk Producers and Failures, 1934-19+0 24 3 Grape Growing and Winemaking 39 in the Napa Valley 4 Building a Market for Napa Wines: Brand 67 Development from Repeal to World War II 5 California Wine and World War II 98 6 Napa Wine during Wartime 111 7 Table Wine Triumphant, 1947-1967 136 8 Politics and Promotion: The Napa Valley 146 Vintners


c objectives. First, it gives a detailed description of the economic organization of the U.S. wine industry. Information is provided about wine’s unique attributes; grape growing, wine produc- tion, and wine distribution; wine fi rms and consumers; and grape and wine markets. Second, the book uses economic principles to shed light on the behavior of wine producers and consumers in a manner that is accessible to noneconomists as well as students of economics. Lastly, it Preface summarizes fi ndings and presents insights from the growing body of studies

that early varieties tend to be shy producers and to produce lower quality wine under these conditions, it is not usually a good idea to plant early- maturing wine-grape varieties in an area with a long, hot grow- ing season. In latitudes toward the poles, grape growing is 41 hß e o c o 3 o £ Growing Wine Grapes limited by a short growing season and severe cold. A short period of 0° F. is likely to kill European vines. Nearer the equator, grapes suffer from the lack of a winter dormant period and perhaps from high humidity. Hence the planting of grapes

in Wine

entire span of effort, progress, and hard- learned lessons. From the first commercial beginnings of the 'thirties in Los Angeles County, grape growing and wine making had spread, by 1895, to nearly every county in the state. A t the turn of the century California's eight wine dis- tricts had become world-famous. This transformation from the pastoral to the industrial state was one of the great agri- cultural achievements of nineteenth-century California. T h e viniferas had been brought to California at the time of the establishment of the Spanish missions, but

Chapter II The Pre-Haraszthian 3Fifties THE GOLD RUSH of 1849 was the principal stimulus to commercial viticulture in the early period, for it was grape growing and wine making that, above all other agricultural pursuits, received the greatest encouragement from the miners.1 The wine industry of California today is largely the product of developments that began in the decade 1850 to i860.2 The increased consumption of wine as a result of the dis- covery of gold led to an unprecedented expansion in grape culture3 that continued until the 'seventies, when a

industry. They have higher marginal cost for two reasons: fi rst, they have lower aver- age winemaking ability, and second some are willing to accept higher cost in return for the utility of nonmarket goods associated with grape growing and wine producing. Finally, because they have higher mar- ginal cost and face a downward-sloping demand curve for their wine, they will charge higher prices. The third prediction is that the marginal cost of producing wine will decrease the longer a proprietor operates in the industry. The more experience an owner has making wine

molecules called anthocyanidins, which have a molecule of sugar attached that is cleaved to form anthocyanins. There are fi ve major groups of anthocyanins in grapes: cyanins, petunins, peonins, malvins, and delphins. The presence and concentration of each relative to the others contributes to the intensity and tonality of color of both grapes and wines made with those grapes. ava (american viticultural area) A specifi c grape-growing and wine production area in the United States, created along the lines of France’s Appellation d’Origine Controlée (AOC) and

intervention in grape growing and winemaking is inherently economic. Wine is an economic good gov- erned by the market forces of demand and supply. Grape growing and winemaking choices are heavily infl uenced by consumer tastes and pref- erences and production costs. Decisions to intervene in the natural wine 36 | The Wine Product production process invariably involve quality and cost considerations related to the satisfaction of consumer wants and desires. WINE AS AN ECONOMIC GOOD Wine is an economic good because people value it and derive utility from its

131 The property next to ours, with its castle- like, 1890s- era manor house and surrounding vineyard, had passed through various hands over time. During World War II it had served as a rest camp for naval offi - cers and was the setting for at least three Hollywood movies, including This Earth Is Mine. During the later 1940s and into the 1950s it remained a visible landmark in Napa Valley as a well- known resort. After passing to new own ership in 1956, the place closed down as a guest facility and went into quiet decline. Yet at least some grape growing