Predicting the quality and prices of Bordeaux wines
AbstractBordeaux wines have been made in much the same way for centuries. This article shows that the variability in the quality and prices of Bordeaux vintages is predicted by the weather that created the grapes. The price equation provides a measure of the real rate of return to holding wines (about 2–3% per annum) and implies far greater variability in the early or ‘en primeur’ wine prices than is observed. The analysis provides a useful basis for assessing market inefficiency, the effect of climate change on the wine industry and the role of expert opinion in determining wine prices.
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Bibliographic InfoPaper provided by American Association of Wine Economists in its series Working Papers with number 37297.
Date of creation: Apr 2007
Date of revision:
wine quality; wine prices; weather; Bordeaux wine; wine auctions; Demand and Price Analysis; Environmental Economics and Policy;
Other versions of this item:
- Orley Ashenfelter, 2008. "Predicting the Quality and Prices of Bordeaux Wine," Economic Journal, Royal Economic Society, vol. 118(529), pages F174-F184, 06.
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