Firm Creation, Firm Evolution and Clusters in Chile’s Dynamic Wine Sector: Evidence from the Colchagua and Casablanca Regions



May 2008. Interviews were carried out by Helen Dennis or by the author, whose
permission has been sought to use these sources.

The wine sector is characterised by a range of significant knowledges which can produce
innovation. Each firm will need to develop expertise in all three knowledges (and develop
a record of sustained innovation within those knowledges) in order to continually
upgrade, improve the quality of these wines and continue an upward trajectory not only
in export volume but also in export value.

These three knowledges can be described as:

1) Links to the development of natural and agrarian knowledges which will steadily
improve the quality of the main input - wine grapes. These knowledges will be
mainly local in context and will attempt to maximise the benefit of wine grape
production from a particular
terroir.

2) Innovations and knowledges from local networks. Many “cluster” surveys of a
tick-box nature have managed to completely ignore the development of local
networks of knowledge transfer in the local area. By concentrating on just the
entrepreneurs the development of knowledges linked to the process of
winemaking and estate management in local networks tends to be overlooked.

3) Innovations and knowledges from global networks. Many Chilean wine
companies have been successful because they have transformed their products
from appealing to the local, national market to products which appeal to global
(European and North American) markets. For example, white wines have become
less oxidized and dry and more driven by the demands of fruit-driven palates of



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