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Natural endowments, production technologies and the quality of wines in Bordeaux. Does terroir matter?

  • GERGAUD, Oliver
  • GINSBURGH, Victor

We study whether quality assessments made by wine experts and by consumers (based on prices obtained at auction between 1980 and 1992), can be explained by variables describing endowments (land characteristics, exposures of vineyards) and technologies (from grape varieties and picking, to bottled wines). However, since technological choices are likely to depend on endowments, the effects can only be identified using an instrumental variables approach. We show that technological choices affect quality much more than natural endowments, the effect of which is negligible. (JEL Classification: L66, Q12, Q13, Q16)

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File URL: http://dx.doi.org/10.1111/j.1468-0297.2008.02146.x
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Paper provided by Université catholique de Louvain, Center for Operations Research and Econometrics (CORE) in its series CORE Discussion Papers RP with number -2025.

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Handle: RePEc:cor:louvrp:-2025
Note: In : The Economic Journal, 118, 142-157, 2008
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