Designation of origin distillates in Mexico: Value chains and territorial development

Abstract

Geographical Indications (GI) have been used in several countries, mainly in Europe, as tools to promote territorial development. These tools have been adopted in Latin American countries without serious reflection on their scope, limits, and advantages. One of the most relevant elements therein corresponds to the way in which these assets participate in value chains, whether short or long, which has important implications for governance, benefit distribution, geographic organization of value accumulation processes, among others. With that in mind, we identify the two most relevant Mexican GIs—namely Designation of Origin Tequila (DOT) and Designation of Origin Mezcal (DOM)—to analyze how their value chains have been constructed and their impact on territorial development. We conclude that GIs tend to adopt large value chains to satisfy long-distance demand, but they can have negative territorial effects if institutions are not strong enough to appropriately incorporate territorial stakeholders’ demands.