Expert Opinion and the Demand for Experience Goods : an experimental approach in the retail wine market
AbstractThe effect of expert opinion on demand for experience goods is difficult to quantify, as the relationship between purchases and reviews may be driven by product quality. Further, it is unclear whether a review-based demand effect is due to providing quality or existence information. Utilizing a retail field experiment to overcome these obstacles, we find a significant positive average consumer response to expert opinion labels for wine. Demand decreases for low scoring wines and demand increases for wines scoring average or higher. Results indicate that expert opinion labels transmit quality information as opposed to solely shelf visibility.
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Bibliographic InfoPaper provided by University of California at Berkeley, Department of Agricultural and Resource Economics and Policy in its series CUDARE Working Paper Series with number 1049.
Length: 25 pages
Date of creation: 2009
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Postal: University of California, Giannini Foundation of Agricultural Economics Library, 248 Giannini Hall #3310, Berkeley CA 94720-3310
Other versions of this item:
- James Hilger & Greg Rafert & Sofia Villas-Boas, 2011. "Expert Opinion and the Demand for Experience Goods: An Experimental Approach in the Retail Wine Market," The Review of Economics and Statistics, MIT Press, vol. 93(4), pages 1289-1296, November.
- Hilger, James & Rafert, Greg & Villas-Boas, Sofia B, 2011. "Expert Opinion and the Demand for Experience Goods: An Experimental Approach in the Retail Wine Market," Department of Agricultural & Resource Economics, UC Berkeley, Working Paper Series qt4nc7h417, Department of Agricultural & Resource Economics, UC Berkeley.
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