Hmmm: Don't Waste Your $$$ on Expensive Wines

Or so says the American Association of Wine Economists (whatever that is!) in a working paper published this past April. The paper entitled "Do More Expensive Wines Taste Better? Evidence from a Large Sample of Blind Tastings" concludes...

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 relationship between price and enjoyment. Our results indicate that both the prices of wines and wine recommendations by experts may be poor guides for non-expert wine consumers.

Ok, let me get this straight, not only do they conclude that expensive wine doesn't taste any better than cheap wine BUT they also maintain that people enjoy expensive wine LESS!

Shocking. I think these folks must secretly work for the beer industry.

I believe the problem isn't taste but pricing. I have no idea how the economics of wine production work but I assume that there are two main inputs to price: production size and reputation. Reputation is the difficult thing to control because it is something that is built over time with a loyal following or tied to a favorable rating by a so-called wine expert. Consequently, one of the main drivers for price is others perceptions of the taste of the wine. Production size is also important given Econ 101 laws of supply and demand.

I have had some very nice wines that didn't cost much and some expensive wines that I didn't enjoy. The bottom line for me is that people should drink wine that tastes good to them...cheap or expensive.

Cheers.

To read the study click here.