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Identifying the Effects of Objective and Subjective Quality on Wine Prices*

  • Edward Oczkowski (a1)
Abstract
Abstract

This study examines a framework developed by Cardebat, Figuet, and Paroissien in a 2014 Journal of Wine Economics article for identifying the impacts of both objective and subjective quality on wine prices. We recognize how various specifications are observationally equivalent and that the interpretation of model estimates depends crucially on the posited assumption for the relation between price and objective and subjective quality. The proposed framework is applied to Australian premium wines. Results indicate that the price impact of expert personal opinions is similar to the impact of objective quality as estimated via weather, vintage, and producer fixed effects. The relative importance of objective quality compared with subjective quality depends crucially on the ability of expert scores to accurately reflect objective quality. (JEL Classifications: C21, Q11, Q54)

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COPYRIGHT: © American Association of Wine Economists 2016 
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*

Comments from an anonymous referee and communications with Jean-Marie Cardebat and Emmanuel Paroissien clarifying aspects of their article are gratefully acknowledged.

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This list contains references from the content that can be linked to their source. For a full set of references and notes please see the PDF or HTML where available.

O. Ashenfelter (2008). Predicting the quality and prices of Bordeaux wine. Economic Journal, 118(529), F174–F184.
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J.-M. Cardebat , J.-M. Figuet , and E. Paroissien (2014). Expert opinion and Bordeaux wine prices: An attempt to correct biases in subjective judgments. Journal of Wine Economics, 9(3), 282–303.
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Journal of Wine Economics
  • ISSN: 1931-4361
  • EISSN: 1931-437X
  • URL: /core/journals/journal-of-wine-economics
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