Value Creation and Value Appropriation in Networks: an Empirical Analysis in the South Region of Brazil

Carla M. Schmidt (University of Sao Paulo)
Maria S. M. Saes (University of Sao Paulo)
Guilherme F. A. Monteiro (Insper Institute of Education and Research)

Abstract: Studies on complex organizations, such as networks, are recent and deserve more in-depth empirical analysis. This paper contributes to this literature by investigating a network that operates within the Agro-Industrial System of wine in Vale dos Vinhedos, South region of Brazil. The network encompasses wineries, grape growers, hotels, restaurants and craftworkers. Within this complex system, several collective actions take shape with special mention to the existence of a certification of origin (Indication of Origin label) for fine wines. Although this certification is supposed to affect the several agents within the network, the actual impact of the certification is unknown. The present paper aims to identify (i) whether the network of Vale dos Vinhedos enables the creation of value for the different agents that operate within it and (ii) how the appropriation of value occurs within the network. Based on interviews and questionnaires conducted with wineries and grape growers, the article performs panel estimations. The main results point to a value creation scenario in the network. Specifically, the certification of origin has a positive impact on sales of both fine and common wines. Results also suggest that the certification has a positive influence on local producers’ income. Regarding the appropriation of value, results suggest that the wineries are able to appropriate a greater amount of the value created within the network.

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