D&D&Wine

Since it's winter quarter, and the MBA1s in the class are in the midst of the regression project and finals studying for Data & Decisions, I thought I'd look for some statistical analyses of wine prices. I came across the below study, which provides some interesting statistical (although not really surprising) results on factors that affected Bordeaux wine prices in 1996-1999. The primary conclusion of the study is that Bordeaux wines of the 1996-1997 vintages were priced predominantly on the prior reputation of the appellation where the wine was produced, although other factors such as "taste" and "bouquet" were found to have statistically significant (albeit smaller) impacts on prices. Importantly, all variables in the study were significant at the 5% level, and all but 2 variables were significant at the 1% level.

However, the study notes that the predominance of reputation has decreased since prior studies on 80s vintages, primarily due to "the reduction in information asymmetries between consumers and producers and the increased competition in wine market," according to the authors. Given the study was published in 2004 about 90s vintages, it would be interesting to see an updated analysis, particularly given the increase in popularity of "new world" wines, the increasing oversupply in the market, and the democratizing power of the internet.

https://www.researchgate.net/publication/24068071_What_explains_Bordeaux_wine_prices