Faith and fermentation: The impact of religious composition on global wine trade

Abstract This paper examines the impact of shared religious composition on global wine trade. We assembled a novel dataset of bilateral wine trade flows and country-level religious affiliation for 102 countries from 1988 to 2023. Our theory-consistent gravity estimates show that a greater common share of Protestant denominations between trading partners is associated with increased bilateral wine trade. In contrast, a higher share of Other Christian denominations is associated with lower trade intensity. To quantify the implications of religious similarity for global wine trade, we conducted a general equilibrium simulation. We find that increasing global alignment in the Protestant denomination would reduce trade costs more than eliminating all global tariffs, with major exporters seeing export gains up to 205.9%. These findings suggest that cultural factors, long treated as secondary, play a central role in shaping trade integration and should be considered alongside standard trade policy tools.