Estimation of a Hedonic Price Equation for Bordeaux Wine: Does Quality Matter?

TLDR

The study applies hedonic price analysis to Bordeaux wine. The authors estimate a hedonic price model that incorporates both objective bottle attributes and sensory characteristics, using data from a jury‑graded experimental sample of Bordeaux wines. Results show that market price is driven mainly by objective characteristics, whereas quality is largely determined by sensory attributes.

Abstract

In this paper the hedonic price technique is applied to Bordeaux wine. In the hedonic price function we include not only the 'objective' characteristics appearing on the label of the bottle, but also the sensory characteristics of the wine. Our data come from an experimental study in which juries have evaluated and graded a sample of Bordeaux wines. The estimation of the hedonic price equation shows that the market price is essentially determined by the objective characteristics. The estimation of a jury grade equation shows that quality, unlike the market price, is essentially determined by the sensory characteristics.