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Good Reads | The Price of Wine

Economics / Wine

Priceonomics: The Price of Wine

Tumblr_inline_mkfrumnjWC1qz4rgpHowever, it’s unclear whether anyone can tell the difference between a $2,000 Lafite Bordeaux and a $3 table wine. In fact, most wine economists consider the matter settled. Blind tastings and academic studies robustly show that neither amateur consumers nor expert judges can consistently differentiate between fine wines and cheap wines, nor identify the flavors within them.

So, what’s going on in the wine industry? If a $10, $100, and $1,000 bottle all roughly taste the same in a blind taste test, how do you explain their different price tags?

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Numerous experiments have shown that people will enjoy a table wine and a fine wine equally if they believe that they are both fine wine. Knowing that a wine is supposed to be good does literally make it taste better. The drinkers could be lying about enjoying the “bad” wine due to social pressure. However, an experiment involving a Stanford wine tasting group, a group of identical wines presented under fake price tags from $5 to $90, and a fMRI machine measuring activity in areas of the brain correlated with pleasure suggests otherwise. Drinking the same wine with a higher price tag did increase pleasure.