Hedonic Wine Price Functions and Measurement Error

Using simulations from discrete choice experiments to measure consumer sensitivity to brand, region, price, and awards in wine choice

“…Accumulated theoretical and empirical evidence suggests that wine prices depend on quality, reputation and objective characteristics (Oczkowski, 2001). Koewn and Casey (1995) found that pricing was extremely important to all respondents in a study of wine purchasing influences.…”

“…It has been found that the reputation of the producer and objective wine trait measures such as the wineÕs year of vintage, region from which the grapes were sourced and the grape variety are significantly related to price (Combris et al, 1997, Combris, Lecocq, & Visser, 2000Landon & Smith, 1997;Oczkowski, 2001). It was also found that when overall sensory quality scores are employed with objective characteristic traits, a significant relationship with price occurs (Angulo et al, 2000;Combris et al, 2000;Golan & Shalit, 1993;Landon & Smith, 1997;Ling & Lockshin, 2003;Oczkowski, 1994Oczkowski, , 2001Schamel, Gabbert, & von Witzke, 1998;Wade, 1999).…”

“…It was also found that when overall sensory quality scores are employed with objective characteristic traits, a significant relationship with price occurs (Angulo et al, 2000;Combris et al, 2000;Golan & Shalit, 1993;Landon & Smith, 1997;Ling & Lockshin, 2003;Oczkowski, 1994Oczkowski, , 2001Schamel, Gabbert, & von Witzke, 1998;Wade, 1999). Landon and Smith (1997) suggest that given the incomplete information on quality, consumers rely heavily on both individual firm reputation based on the past quality of the firmÕs output and collective or group reputation indicators.…”

Market price differentials for food packaging characteristics

“…However, if competition is not perfect or the market is not in equilibrium, then these implicit prices can also be influenced by producers' or intermediaries' pricing decisions, but the importance of this assumption only received very limited attention in most hedonic pricing studies (Nerlove, 1995). Following Rosen's approach, a large number of studies estimated implicit prices for wine product characteristics such as region and country of origin (Nerlove, 1995;Oczkowski, 1994;Panzone & Simões, 2009), grape variety (Schamel & Anderson, 2003;Steiner, 2004), producer characteristics (Ling & Lockshin, 2003), wine critic scores (Costanigro, McCluskey, & Mittelhammer, 2007;Landon & Smith, 1997;Oczkowski, 2001;Schamel & Anderson, 2003;Steiner, 2004), availability of label information in a wine magazine (Costanigro et al, 2007) or intrinsic characteristics operationalised by expert sensory evaluations (Brentari, Levaggi, & Zuccolotto, 2011;Cardebat & Figuet, 2004;Combris, Lecocq, & Visser, 1997. To our best knowledge, no previous study has studied implicit prices for food packaging attributes.…”

The Brand Choice Model of Wine Consumers: A Multinomial Logit Model

“…They have also found a positive relationship between the components of customer-based brand equity and the firms' performance in luxury hotels and chain restaurants. Oczkowski (2001) suggested that wine prices depend on quality, reputation and objective characteristics. Batt and Dean (2000) found that labeling and packaging are important factors in wine consumption choices.…”