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Wine Quality, Wine Prices, and the Weather: Is Napa “Different”?*

Published online by Cambridge University Press:  08 June 2012

Carlos D. Ramirez
Carlos D. Ramirez
Affiliation:
Department of Economics, George Mason University, Fairfax, VA 22030–4444, email: [email protected]
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Abstract

This paper uses a large longitudinal database (nearly 6,000 observations) of all cabernet sauvignon wines rated by Wine Spectator from 1970 to 2004 in the Napa Valley region of California to investigate whether a quality-weather relationship and a price-weather relationship exist and, if so, whether they occur in a linear, quadratic, or log-linear fashion. The paper examines three different models of wine rating and wine prices to study the effect of weather variations. The results suggest that the weather affects both quality and wine prices, but the results are much stronger for prices than for ratings. A log-linear model can explain nearly 92 percent of the variation in wine prices, but only about 28 percent of the variation in wine ratings. (JEL Classification: C23, Q54)

Type
Articles
Information
Journal of Wine Economics , Volume 3 , Issue 2 , Winter 2008 , pp. 114 - 131
Copyright
Copyright © American Association of Wine Economists 2008

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