Expert Opinion and the Demand for Experience Goods: An Experimental Approach in the Retail Wine Market

James Hilger, Greg Rafert and Sofia Villas-Boas
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James Hilger: U.S. National Marine Fisheries Service
Greg Rafert: Analysis Group

The Review of Economics and Statistics, 2011, vol. 93, issue 4, 1289-1296

Abstract: The effect of expert opinion on demand for experience goods is difficult to quantify, as the relationship between purchases and reviews may be driven by product quality. Further, it is unclear whether a review-based demand effect is due to providing quality or existence information. Using a retail field experiment to overcome these obstacles, we find a significant positive average consumer response to expert opinion labels for wine. Demand decreases for low-scoring wines and increases for wines scoring average or higher. Results indicate that expert opinion labels transmit quality information as opposed to solely shelf visibility. © 2011 The President and Fellows of Harvard College and the Massachusetts Institute of Technology.

Date: 2011
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