A new working paper, Do More Expensive Wines Taste Better? Evidence from a Large Sample of Blind Tastings. After some regressions:
In sum, in a large sample of blind tastings, we find that the correlation between price and overall rating is small and negative. Unless they are experts, individuals on average enjoy more expensive wines slightly less. Our results suggest that both price tags and expert recommendations may be poor guides for non-expert wine consumers who care about the intrinsic qualities of the wine.
You already know this, but can't hurt to repeat in these times when we are all aware of the economic reality of scarcity.... (H/T Robin Hanson).
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This is totally wrong. They did the study wrong. You can't compare 1 dollar bottles of wine and 150 dollar bottles of wine.
In the range from just under 10 to just over 30 ... i.e., wines that actually exist in actual wine stores, there is a strong correlation.
If you look at the analysis, the results they get do not show a negative correlation ... they show randomness unless you really mess with the data. They are comparing apples to oranges here!
There's also the fact that good wine is an acquired taste. The uneducated palate, particularly the uneducated palate raised on a corn-syrup-with-everything diet, does not have what it takes to appreciate good wine (or beer for that matter). They'd probably prefer Vimto.
Conclusory statement based on facts not in evidence.
Based on comparisons of wines priced from less than $2 to $30, the $2 stuff is often quite a bit better. Bear in mind that the actual cost of wine itself is low enough that Bronco makes a healthy profit from the $2 wine, and aside from crop yield [1] there's not much difference in production cost. The rest of that is strictly branding, advertising, and retail markup, with retail markup being the biggest factor.
A lot of your $10 to $30 wine in wine shops comes from the same vats as "Two Buck Chuck" at Trader Joe's, and aside from volume discounts the wholesale prices are the same. For whatever reason, wine stores prefer high margin/low volume over high volume/low margin.
We'll see what the current economic conditions do to that business model.
[1] Which is primarily a function of the variety.
these studies are a big waste of time. until people realize that "quality" of wine is almost entirely subjective, then stupid results such as this will continue to dominate the current wine zeitgeist. also, "quality" is never the only factor in determining the price of a wine. the price of wine is subject to all of the factors that you learn about in economics 101, the most important of which is supply and demand.
the most important thing to realize about wine "quality" is the subjectiveness of the consumer's experience. the average occasional wine drinker who has not spent a lot of time training their palate or building a complete wine vocabulary will simply not be able to appreciate the finer notes and qualities of a fine, hand-crafted wine. the analogy that i like to use is to compare Garage Band with Logic Pro. Garage band comes free with all macs these days and is a perfectly capable music production program that many beginning musicians and hobbyists will enjoy but if you really want to produce professional sounding music you need to upgrade to some professional software that will be almost impossible to use without a lot of training in how to use it. If you are just getting started learning how to make music, you would waste a lot of time and money buying Logic first rather than playing around with the garabe band program. similarly, if you are new to wine, don't spend your money on expensive wine that you may not enjoy because you know nothing about it.
You can't compare 1 dollar bottles of wine and 150 dollar bottles of wine.
Sure you can: Uncork/unscrew each, pour into identical glasses, hand to waiter, have waiter bring to taster, have taster write down which one they'd prefer to drink. Repeat with different tasters for large enough N to be statistically significant.
It's what we scientists like to call "a double blind trial." ;-)
That said, glancing briefly through the paper, I was concerned that they base most of their analysis on a linear regression, ignoring higher order effects. It may be that there is a more complex relation between price and quality, where, for example, $20 wines are better than $10 ones, but $150 wines are worse than $30 ones. In this case you'd be more concerned about the trend over the expected purchasing range ($10-$30), rather than over the full $1.50-$150 range.
DC Sessions,
while crop yield is somewhat determined by varietal, the biggest factor in determining crop yield is the desired "quality" of the juice from the grower. All of the "best" wines are made from grapes whose vineyards have been meticulously trimmed and pruned (vastly increasing the production cost)to remove less than perfect grapes and concentrate the growth of the plant into the remaining grapes. Production cost is actually one of the biggest determinants in price and while it may seem like all wine "costs" the same, this could not be further from the truth. Bronco keeps their production costs down by doing minimal vineyard management, (and what little vineyard management they do, they do by machine), extracting the highest yields they can from a given area (by watering, fertilizing, etc), harvesting by machine (which collects whole bunches of grapes indiscriminately) and then producing the wine quickly and efficiently in large containers. Compare that to some of the "best" wine producers who spend thousands of person hours in the vineyards throughout the growing season to insure that only the best grapes stay on the vine, keeping their yields low, harvesting their grapes by hand and then producing their wines in small, controlled batches. The real difference between Bronco and the boutique wine producers is that Bronco spends as little as possible of production and as much as they can on branding and advertising while the boutique producer spends all of their money on production and trust that their wine will provide all of the branding and advertising necessary to keep them in business.
This article is spot on!
A few years ago my former father-in-law - a Frenchman from the Champagne district, whose career was spent as a wine purchaser - was comparing prices of champagne in New York, and was amazed that Veuve Clicquot was about 3 times more expensive here than Jacquard champagne. He pointed out that it must be how the champagnes are marketed here, as the vineyards (aka wineries, to Americans?!) are located side by side in the champagne district, and they use the same grapes and the same "method champagnoise" to make their product, and of course in France they retail for exactly the same price!
He was interested in trying out wines that he normally couldn't get in France, so I introduced him to my favorite wines, Gato Negro and Gato Blanco, from Chile - which retails for about $7 for a large bottle. He loved them, especially the Gato Negro, and it was surprising to see him, a Frenchman, taking 2 bottles of this back to France to introduce to his fellow wine lovers.
So yea, there seems to be a total disconnect between wine quality and price!
No. Not like Garage Band and Logic Pro. You're not making the wine, you're tasting it. There are some elements of acquired taste involved, but it is in-freaking-sufferable to tell people that like $4 wine as much as $40 wine that their mouth is "uneducated" or "untrained."
Not to mention transparently stupid. A $40 bottle of wine, with a "sufficiently educated palate," may or may not be better than a $4 bottle. But there is no way in the world that a $40 bottle of wine is *ten times* better than a $4 bottle. But as long as people have more money than sense...
Greg Laden:
Have you looked at pp. 10-11 of the paper? They say that the effect is stronger for wines in the $6 to $15 range. (The coefficient is larger, and the statistical significance is improved.)
What would "ten times better" even mean in this context? How would you quantify it? Is it on a linear or a log scale?
Regardless of whether the have the mechanics right for this study the overall finding remains true. Just take a look at the gems that can be found at TJ's. If you help finding some of your own I can offer my current favorites in Trader Joe's Wines as a starting point. Enjoy!
Cheers,
Jason