When Does The Price Affect The Taste? Results From A Wine Experiment
AbstractWe designed an experiment that examines how knowledge about the price of a good, and the time at which the information is received, affects how the good is experienced. The good in question was wine, and the price was either high or low. Our results suggest that hosts offering wine to guests can safely reveal the price: much is gained if the wine is expensive, and little is lost if it is cheap. Disclosing the high price before tasting the wine produces considerably higher ratings, although only from women. Disclosing the low price, by contrast, does not result in lower ratings. Our finding indicates that price not only serves to clear markets, it also serves as a marketing tool; it influences expectations that in turn shape a consumer’s experience. In addition, our results suggest that men and women respond differently to attribute information.
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Bibliographic InfoPaper provided by American Association of Wine Economists in its series Working Papers with number 51755.
Date of creation: Apr 2009
Date of revision:
Price-Quality Heuristic; Attribute Information; Role of Expectations; Marketing; Blind Tasting; Wine; Consumer/Household Economics; Demand and Price Analysis; C91; D03; D83; M31;
Other versions of this item:
- Almenberg, Johan & Dreber, Anna, 2009. "When Does the Price Affect the Taste? Results from a Wine Experiment," Working Paper Series in Economics and Finance 717, Stockholm School of Economics, revised 20 Apr 2009.
- C91 - Mathematical and Quantitative Methods - - Design of Experiments - - - Laboratory, Individual Behavior
- D03 - Microeconomics - - General - - - Behavioral Economics; Underlying Principles
- D83 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Search, Learning, and Information
- M31 - Business Administration and Business Economics; Marketing; Accounting - - Marketing and Advertising - - - Marketing
This paper has been announced in the following NEP Reports:
- NEP-AGR-2009-08-08 (Agricultural Economics)
- NEP-ALL-2009-08-08 (All new papers)
- NEP-CUL-2009-08-08 (Cultural Economics)
- NEP-EXP-2009-08-08 (Experimental Economics)
- NEP-MIC-2009-08-08 (Microeconomics)
- NEP-MKT-2009-08-08 (Marketing)
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