Early Sales of Bordeaux <i>grands crus</i>

Mahenc, Philippe; Meunier, Valérie

doi:10.1017/s1931436100000092

Cited by 12 publications

(10 citation statements)

References 20 publications

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“…We differentiate between wines from the left and the right bank of the Dordogne. 21 For a discussion of Bordeaux en primeur pricing, see Mahenc and Meunier (2006), who study this issue from a theoretical perspective, and Christensen and Meunier (2006), who analyze empirically this issue and find no evidence suggesting an overpricing. 20 It is often argued that only very good to great vintages can be considered as investment grade and, indeed, all vintages considered as outstanding have experienced very strong price increases.…”

Section: B Vintage Ranking and Rating Defined Indicesmentioning

confidence: 99%

Wine as an Alternative Asset Class

Masset¹,

Weisskopf

2010

J Wine Econ

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Using a dataset that spans the period 1996 to 2007 and contains transaction prices for all reported auctions at the Chicago Wine Company, we analyze how the prices of high-end wines have evolved during this time period. The best wines according to characteristics like vintage, rating and ranking earn higher returns and tend to have a lower variance than poorer wines. Nevertheless, the different categories of wines seem to follow a rather similar trend over the long run. Wine returns are only slightly correlated with other assets and can consequently be used to reduce the risk of an equity portfolio. Wine looks even more attractive when the investor also has concerns about the skewness of his portfolio. However, the part to be invested in wine is reduced once the kurtosis is included into the analysis. Finally, it seems advisable to diversify across different wine categories as their short-run movements are partially independent of each other. First growths and wines rated as extraordinary by Robert Parker deliver the best tradeoff in terms of portfolio expected returns, variance, skewness and kurtosis for most investor preference settings under consideration. (JEL Classification: C60, Gl 1, Ql 1)

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Section: B Vintage Ranking and Rating Defined Indicesmentioning

confidence: 99%

Wine as an Alternative Asset Class

Masset¹,

Weisskopf

2010

J Wine Econ

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“…In this 3 Akerlof's lemons problem would occur if producers of a low-quality wine would sell at the same price as producers of high-quality wine. 4 Mahenc and Meunier (2006) mention that "the samples may be drawn from a particular barrel that has been blended and set aside on purpose". 5 Contrary to most New World wine regions or countries (California, South Africa, New Zealand, Chile, etc.…”

Section: Structural Modelmentioning

confidence: 99%

Identifying the effect of unobserved quality and expert reviews in the pricing of experience goods: Empirical application on Bordeaux wine

Dubois

Nauges

2010

International Journal of Industrial Organization

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“…Using the fact that wine expert Robert Parker did not review Bordeaux wines before en primeur prices were established for the 2002 vintage, as he had in other years, the authors were able to conclude that the "Parker effect" averaged 2.8 euros per bottle. Mahenc (2004) and Mahenc and Meunier (2006) have also explored signaling in these markets.…”

Section: Literature Reviewmentioning

confidence: 99%

Evidence of Convergence to a Signaling Equilibrium for California Wine 2001-2005

Miller¹,

Stone

Stuen³

2013

JRIO

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Much research has examined Akerlof's "lemons" problem, however, very little has addressed convergence to a Spence signaling equilibrium. We examine this convergence issue by testing whether the explained variance in wine prices for California Cabernet Sauvignon improves as the same set of wines progress through subsets of consecutive years. The data are from Wine Spectator and organized in subsets of common wines for 2004 to 2005, 2003 to 2005, 2002 to 2005, and 2001 to 2005. We perform regressions of wine price on quality attributes for each year in each data subset. Using the R-square and mean square error from these regressions, we then perform a trend analysis to examine the factors influencing the improvement of the Rsquare through each year and each wine subset. We find that position or year in the wine subset is a significant determinant of goodness of fit after accounting for year and sample affects. This result, while not conclusive, may suggest some degree of wine price convergence within these subsets of wines.

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Early Sales of Bordeaux grands crus

Cited by 12 publications

References 20 publications

Wine as an Alternative Asset Class

Wine as an Alternative Asset Class

Identifying the effect of unobserved quality and expert reviews in the pricing of experience goods: Empirical application on Bordeaux wine

Evidence of Convergence to a Signaling Equilibrium for California Wine 2001-2005

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