Product differentiation and the relative importance of wine attributes: U.S. retail prices

Raj Chandra and GianCarlo Moschini

Journal of Wine Economics, 2022, vol. 17, issue 3, 177-208

Abstract: This paper investigates the relative importance of various attributes, including varietal, brands, and geographic origin, in explaining retail wine prices for the United States market. We use a metric based on the Shapely value, from cooperative game theory, in the context of an empirical hedonic price equation estimated using a large sample of retail wine sales for home consumption over the period 2007–2019. We find that brands alone explain more than 70% of the variation in wine prices, but geographic origin and varietals retain additional explanatory power. Furthermore, information about the geographic origin appears to be a considerably more important attribute than varietals.

Date: 2022
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Persistent link: https://EconPapers.repec.org/RePEc:cup:jwecon:v:17:y:2022:i:3:p:177-208_1

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