Regime Shifts DataBase

Large persistent changes in ecosystem services

Small-scale wineries, High Quality

There are around 5-6000 acres of small-scale vineyard in the region. There is no forest on the mountains, the soil is thin and rocky, people are growing grapes on steep hillsides - in many cases by hand. The local families and wineries are cultivating, harvesting and producing wine independently. The knowledge and tradition about wine making is well distributed among the local people, there is enough capacity for experimentation, adaptation and learning.

Large-scale winery, Large Quantity

In this regime, the vineyards are transformed to produce large quantities. They are cultivated with tractors, the whole procedure is centralized and coordinated by the state-owned company in a very cost-effective way. The wine is exported to the Comecon countries. The yearly harvest per plant is sometimes up to ten times bigger than before, but the wine quality is much lower.

The regime shift happened after the Second World War, as Hungary became part of the Eastern bloc. The national economy was transformed to planned economy and became dependent on the Soviet Union in many ways. The Soviet Union had an enormous political influence in the country, there was no way to argue or resist. In Tokaj-Hegyalja first all the vineyards were socialized in 1948, than starting in 1953 all of them where transformed to produce larger quantities. The region started producing wine only for the Comcon market, there were no real market processes present during the dictatorship.

Before 1948, most wineries in the region were small-scale. There were two important feedbacks maintaining this state. The first is the high level of knowledge maintained by the high number of wineries and the constant experience in making good quality wines. The knowledge level of the local community is a slow variable in this system. The second important feedback loop is the access to the quality sensitive markets, which makes it possible to sell the wines for a high price, which enables investment in technology and workforce. These factors have a key importance in long-term success.

After the Second World War, Hungary became part of the Eastern bloc. As the Communist party (supported by the Soviet Union) took over the political power, planned economy was introduced and Hungary became isolated from the Western European countries. People in Tokaj-Hegyalja were forced to join the co-operative.

As the number of wineries decreased (to practically one single company), and the connections to the European market were cut, new feedbacks started to dominate the system. In this setting, the most important factor generating revenue is the quantity of the wine produced. The cheap wine was sold to the Soviet market and the unprofitable local economy was subsidized by the state. The change was first forced by political power, but lately it became persistent as in the coming decades the local society lost most of its traditional knowledge and adopted the socialist wine making strategy. This loss of knowledge and the loss of former markets are the two most important factors behind maintaining the intensive cultivation method even after the political "regime change" in 1989. From this perspective, the political change in 1989 wasn't a regime shift at all. Though the steep and rocky hillsides are the best places to produce high-quality wines, the cultivation on these vineyards is expensive and the amount of grapes harvested is low, thus many of the best vineyards were abandoned after the regime shift. These places became natural habitats, often high biodiversity forests in the coming decades. Today these places are Natura 2000 conservation areas, which makes it difficult to reintroduce wine production. After 1989 the Soviet market was also lost. The state-owned vineyards were privatized, but the successor of the big socialist company remained dominant player in the region. Today, this company is buying up the grapes produced on the privatized vineyards, and the produced wine is sold for a cheap price. There was a small change in the economic structure, but basically the system remained intact: buying up the grapes, the state is still subsidizing the intensive wine producing strategy. Approximately 70% of the region is following this strategy today. The other third tried to produce higher quality wines, but many of them fail to reach the quality sensitive markets, therefore they aren't profitable. As the world winemarket is very competitive, it is a major challenge for the region to make a living by producing wine, thus Tokaj-Hegyalja is today in a poverty-trap, similarly to many regions in post-soviet countries.

Wine production is a fragile process where a major part of the work is "done" by the soil and the grapes. As the vineyards were transformed, the ecosystem services were also transformed: before the regime shift, the grapes consisted of a wide variety of minerals, sugars and aromas to make high-quality wine. This was not possible to maintain when producing high quantities: under this conditions the plants are not capable of concentrate the minerals and nutrients in the grapes. The new ecosystem service was a production of large masses of grapes. In the past decades, the abandoned vineyards transformed to natural habitats having rich biodiversity and thus these became part of the Natura 2000 network (EEA 2013), which is also stabilizing the state after the regime shift.

Due to the regime shift, cultural ecosystem services were also lost. The aesthetic, recreational and cultural values associated with the high-quality wine decreased dramatically. The knowledge maintained by the human-nature interactions was also lost. The long-term effect of the regime-shift on human wellbeing is a "poverty trap". Local people have some revenue from the quantity-oriented production, which is high enough to stabilize the system-state, but not enough for development, neither in the viniculture nor in their living standards. The regime-shift gained only political benefits.

Three major interventions are needed to restore the desirable regime in the wine-region. First is to educate local people about more competitive, high-quality winemaking methodologies and to invest in those technologies, which are required to produce better wine. The success of an education programme is highly dependent on the personal relations and trust among locals. The second is the restoration of the abandoned but formerly high-quality vineyards in the area and raise the quality standards on the winemaking process. The third intervention would be a better marketing for the region to reconnect it to the markets, but it is only possible if the communication and trust among local groups is increased to ensure better collaboration.