In markets for experience goods, publications exist to help consumers decide which products to purchase. However, in most cases these publications accept advertising from the very firms whose products they review, raising the possibility that they bias product reviews to favor advertisers. To test for biased product reviews, I exploit the fact that, of the two major U.S. wine publications, only Wine Spectator accepts advertising. Although the average Wine Spectator ratings earned by advertisers and non-advertisers are similar, I find that advertisers earn just less than one point higher Wine Spectator ratings than non-advertisers when I use Wine Advocate ratings to adjust for differences in quality. However, 1 find only weak evidence that the selective retasting of advertisers' wines contributes to the higher ratings. Moreover, conditional on published ratings, Wine Spectator is no more likely to bestow awards upon advertisers. I conclude that while advertising may influence ratings on the margin, Wine Spectator appears largely to insulate reviewers from the influence of advertisers. (JEL Classification: L15, M37)

The increasing industrialization of the wine supply chain is often associated with a greater vertical coordination. Our paper shows that a spot market institutional arrangement like brokerage can still be a relevant coordination mechanism to mitigate the contractual hazards due to quality problems. Indeed, a broker can be viewed as an expert that can help the merchant to monitor the grower's wine quality process. More precisely, if the merchant cannot credibly monitor the wine making process, it is Pareto improving to delegate this task to a broker. (JEL Classification: D82, L80, M12)

This paper examines the social desirability to disclose pertinent information to participants in an optimal auction environment. In particular, we consider aspects of information which will affect all potential buyers in a uniform fashion. In the case of wine, such information may be interpreted as an unobservable dimension such as the quality or the storage condition of a bottle of wine. We show that when the participants in the auction are symmetrically uninformed in such a dimension, it may be socially optimal not to resolve this common uncertainty. Under the sufficient conditions provided to generate this outcome, efficiency will be restored in the optimal auction. (JEL Classification: D44, D82)

An unrestricted source differentiated LA/AIDS model was used to estimate Korean wine demand. In doing so, this study tested the null hypotheses of product aggregation, block separability and substitutability. The test results show that the unrestricted source differentiated model is significantly different from the aggregated model, separated model, and restricted source differentiated model at the conventional level. By using this system-wide model, this study estimated price and expenditure elasticities to identify the price effect on Korean wine consumption. (JEL Classification: F10, F11, F13)

Econometric demand and supply models of agricultural commodities and crops have been around for a long time with extensive research and adaptations being made in the grain and livestock sectors. This much attention has, however, not been afforded to long term commodities. This paper presents a partial equilibrium framework for modeling long term commodities using the South African wine industry as an example. The model structure is presented and two different approaches to closing the model are compared. The usefulness of the model is tested in the form of baseline projections and the analysis of a typical “what if” question. (JEL Classification: D5, L66, Q11)

This paper examines the effect of the movie Sideways on US wine consumption. Specifically, we examine the affects of the movie on the consumption of Merlot, which is derided in the movie and the affect on Pinot Noir, which is praised. We examine the trends in consumption before and after the movie and perform statistical tests for structural changes in consumption. We also test for changes in consumption of each varietal by price point. (JEL Classification: C22)

Recent papers by Hodgson (2008) and Gawel and Godden (2008) have questioned the consistency of expert wine judges in a wine competition setting. In the latter paper, a methodology introduced in psychometric research to measure judge reliability corrected for chance was used to quantify judge consistency (Cohen, 1968). This paper extends that notion, suggesting a value of 0.7 for Cohen's weighted kappa might be used to define an expert wine judge. With that criterion, less than 30% of judges who participated in either of the two studies would be considered “expert.” (JEL Classification: C1, L15)

The objective of this research is to devise a reliable and accurate scoring algorithm for awarding medals at a major U.S. wine competition that was described earlier by Hodgson (2008). The new algorithm is comprised of a two-tiered method that considers an award on the basis of a total medal score averaged across four judges per each evaluated wine; and a reliability algorithm that grades the degree of inter-judge reliability according to the following criteria: <70% = Poor or Unacceptable; 70%–79% = Fair; 80%–89% = Good; and 90%–100% = Excellent agreement (Cicchetti, 2001). The method has advantages over a previous scoring method that based its decision upon incorrect estimates of majority opinion; and unacceptable levels of inter-judge agreement. (JEL Classification: C1, L15, Q13)