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Do More Expensive Wines Taste Better? Evidence from a Large Sample of Blind Tastings

  • Goldstein, Robin

    ()

    (Fearless Critic Media)

  • Almenberg, Johan

    ()

    (Dept. of Economics, Stockholm School of Economics)

  • Dreber, Anna

    ()

    (Dept. of Economics, Stockholm School of Economics)

  • Emerson, John W.

    ()

    (Yale University)

  • Herschkowitsch, Alexis

    ()

    (Fearless Critic Media)

  • Katz, Jacob

    ()

    (Fearless Critic Media)

Individuals who are unaware of the price do not derive more enjoyment from more expensive wine. In a sample of more than 6,000 blind tastings, we find that the correlation between price and overall rating is small and negative, suggesting that individuals on average enjoy more expensive wines slightly less. For individuals with wine training, however, we find indications of a positive, or at any rate non-negative, correlation. Our results are robust to the inclusion of individual fixed effects, and are not driven by outliers: when omitting the top and bottom deciles of the price distribution, our qualitative results are strengthened, and the statistical significance is improved even further. Our results indicate that both the prices of wines and wine recommendations by experts may be poor guides for non-expert wine consumers.

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File URL: http://swopec.hhs.se/hastef/papers/hastef0700.pdf
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Paper provided by Stockholm School of Economics in its series SSE/EFI Working Paper Series in Economics and Finance with number 700.

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Length: 11 pages
Date of creation: 16 Apr 2008
Date of revision: 24 Apr 2008
Publication status: Published in Journal of Wine Economics, 2008, pages 1-9.
Handle: RePEc:hhs:hastef:0700
Contact details of provider: Postal: The Economic Research Institute, Stockholm School of Economics, P.O. Box 6501, 113 83 Stockholm, Sweden
Phone: +46-(0)8-736 90 00
Fax: +46-(0)8-31 01 57
Web page: http://www.hhs.se/
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  1. Hadj Ali H. & Lecocq S. & Visser M., 2007. "The impact of gurus: Parker grades and en primeur wine prices¤," Working Papers ERMES 0718, ERMES, University Paris 2.
  2. Gerard J. Tellis & Birger Wernerfelt, 1987. "Competitive Price and Quality Under Asymmetric Information," Marketing Science, INFORMS, vol. 6(3), pages 240-253.
  3. G¸nter Schamel & Kym Anderson, 2003. "Wine Quality and Varietal, Regional and Winery Reputations: Hedonic Prices for Australia and New Zealand," The Economic Record, The Economic Society of Australia, vol. 79(246), pages 357-369, 09.
  4. Oczkowski, Edward A., 1993. "A Hedonic Price Function for Australian Premium Table Wine," 1993 Conference (37th), February 9-11, 1993, Sydney, Australia 147769, Australian Agricultural and Resource Economics Society.
  5. 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.
  6. Quandt, Richard E., 2007. "On Wine Bullshit: Some New Software?," Journal of Wine Economics, Cambridge University Press, vol. 2(02), pages 129-135, September.
  7. Lecocq, Sébastien & Visser, Michael, 2006. "What Determines Wine Prices: Objective vs. Sensory Characteristics," Journal of Wine Economics, Cambridge University Press, vol. 1(01), pages 42-56, March.
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