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Indicators of Individual Wine Reputation for Friuli Venezia Giulia

Author

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  • Guenter Schamel

    (Free University of Bozen-Bolzano)

  • Anna Ros

    (Free University of Bozen-Bolzano)

Abstract

The main objective of this paper is to study indicators of individual wine reputation and how they may affect the price of wines in Friuli Venezia Giulia. The analysis is built on the assumption that consumers base their wine purchase decisions on easily available information such as expert quality ratings and reputation builds on past awards for a wine. We estimate a hedonic pricing model using a data set of 1078 Friulian wines listed in the Gambero Rosso wine guide. The categorical nature of the dependent variable suggests the use of ordered response models. The results not only show that awards for the current quality of a wine carry a positive and substantial premium, but also that having received an award in the past (indicating individual wine reputation) has a positive effect on prices. Moreover, the province of production has a considerable effect on prices and white, older wines tend to be more expensive. The paper confirms the important role of current quality ratings and of individual wine reputation in determining wine prices. An important marketing implication is that wineries and retailers should communicate the current quality of a wine together with any past quality recognitions received as this should foster the reputation of an individual wine in the future.

Suggested Citation

  • Guenter Schamel & Anna Ros, 2021. "Indicators of Individual Wine Reputation for Friuli Venezia Giulia," Italian Economic Journal: A Continuation of Rivista Italiana degli Economisti and Giornale degli Economisti, Springer;Società Italiana degli Economisti (Italian Economic Association), vol. 7(2), pages 323-339, July.
    • Handle: RePEc:spr:italej:v:7:y:2021:i:2:d:10.1007_s40797-020-00138-9
    DOI: 10.1007/s40797-020-00138-9
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    References listed on IDEAS

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    1. Francesco Marangon & Laura Pagani & Stefania Troiano & Gian Pietro Zaccomer, 2011. "Il prezzo dei vini di qualit? del Friuli Venezia Giulia: una prima analisi dei dati di fonte camerale," Economia agro-alimentare, FrancoAngeli Editore, vol. 13(1-2), pages 509-514.
    2. Günter Schamel & Kym Anderson, 2019. "Wine Quality and Varietal, Regional and Winery Reputations: Hedonic Prices for Australia and New Zealand," World Scientific Book Chapters, in: Kym Anderson (ed.), The International Economics of Wine, chapter 10, pages 225-253, World Scientific Publishing Co. Pte. Ltd..
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    4. Christine Mauracher & Isabella Procidano & Marco Valentini, 2019. "How Product Attributes and Consumer Characteristics Influence the WTP, Resulting in a Higher Price Premium for Organic Wine," Sustainability, MDPI, vol. 11(5), pages 1-15, March.
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    7. Lecocq, Sébastien & Visser, Michael, 2006. "What Determines Wine Prices: Objective vs. Sensory Characteristics," Journal of Wine Economics, Cambridge University Press, vol. 1(1), pages 42-56, April.
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    9. Edward Oczkowski & Hristos Doucouliagos, 2015. "Wine Prices and Quality Ratings: A Meta-regression Analysis," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 97(1), pages 103-121.
    10. Landon, Stuart & Smith, Constance, 1997. "The Use of Quality and Reputation Indicators by Consumers: The Case of Bordeaux Wine," MPRA Paper 9283, University Library of Munich, Germany.
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    More about this item

    Keywords

    Hedonic pricing; Reputation; Ordered response models; Wine; Friuli Venezia Giulia;
    All these keywords.

    JEL classification:

    • L1 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance
    • L66 - Industrial Organization - - Industry Studies: Manufacturing - - - Food; Beverages; Cosmetics; Tobacco
    • Q13 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Agricultural Markets and Marketing; Cooperatives; Agribusiness

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