Keep the Cheap Wine Flowing

I blogged last week about blind wine tastings — my own casual experiments as well as some more serious academic ones. The bottom line is that in blind wine tastings, there is a zero or even slightly negative correlation between the ratings of regular people and the price of the wine they are drinking; for experts the relationship between rating and price is positive.

I’ve learned a few more things from blog readers about cheap wine over the last few days.

Robin Goldstein has an excellent book, The Wine Trials, which describes the blind wine tastings and which cheap wines people liked. The beauty of this book is that you can bring an $8 bottle of wine to a party and explain that it tastes better than the $28 bottle you would have bought. If the host of the party is an economist, you can tape a $10 bill to the bottle for an even split of the joint surplus.

Not until I read Goldstein’s book did I realize just how weak the correlation was in blind tastings between expert evaluations and price in experimental settings. Yet, somehow Wine Spectator, which claims to do tastings blind (at least with respect to who the producer is), has an extremely strong positive correlation between prices and ratings. Hmmm … seems a bit suspicious.

It turns out that the story with respect to cheap wine is even more true for champagne. I’ve never tasted a $12 bottle of champagne that I didn’t enjoy immensely. It turns out I am not alone. In blind tests, Domaine Ste. Michelle Cuvee Brut, a $12 sparkling wine from Washington, is preferred nearly two to one to $150 Dom Perignon if you strip away the labels.

Dan Ariely (author of Predictably Irrational) and his co-authors have an interesting experiment with beer and balsamic vinegar. If you tell people ahead of time there will be vinegar in their beer, they won’t like the taste. If you don’t tell them and do a blind tasting, they do like the taste. If you let them form their opinions and then tell them there was vinegar in the beer, most continue to say it tasted good.

I am generally skeptical of neuro-economics, but here is one such study which finds that the firing of neurons in the brain is affected by how much the subject thinks the wine he/she is being served cost. The bottom line seems to be that if you think a wine is more expensive, you really do enjoy it more.

Finally, a wonderful tale published in The New Yorker a year ago, written by Patrick Radden Keefe, profiled an ambitious conman who fooled the world’s leading wine experts for more than a decade before his nefarious plot unraveled. I can’t remember the last time I read an article this long from beginning to end in one sitting.

(Hat tip: Eric Jorgenson)

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  1. Lauren says:

    The timing for this article couldn’t have been better for me. As a law student, I am invited to gatherings hosted by attorneys, and I’ve squirmed each time some young hot-shot attorney brags about the $50+ bottle of wine they brought. Frankly, I’ve had no complaints about the wine I bring (Kiona Late Harvest White Riesling, under $20).

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  2. browning says:

    While touring the campus winery at the UC Davis School of Viticulture and Enology, I noticed boxes of tasting glasses made of black glass. I was told that new students and, sometimes, guests, were asked to tell white wine from red, using the glasses that make it impossible to see the color. Most groups of untrained people do no better than random. The graduates of the program can do a lot better. It’s all about constant experience and attention, whether perfume, wine or coffee.

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  3. JP says:

    All I know is that the cheap $7 bottles of wine get you drunk the fastest. But hey, I’m a college student. Am I supposed to know anything else?

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  4. no name yet says:

    so what is your point? when you give a free lunch, it’s undervalued. People should be charged for the knowledge that’s offered them. then they will think it’s valuable. On the other hand, when people don’t know what they are getting, their vision is less blurred by their perception of its importance. So say you are told the professor is a Harvard person- you will listen even if what they say is babble. On the other hand, if you hear that the professor is merely an adjunct, why bother listening, ,they could not possibly have anything of value to say. And if you don’t know and are not told, you are most likely to be impartial. Cool idea and great experiment. I am happy to be a participant.

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  5. doug says:

    I have found that some cheap wine may taste fine, however, the resulting headache is not worth the savings. Find a wine that you like and drink it, regardless of cost.

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  6. Jeff says:

    I think you are missing a key point about those sparklers you mentioned. The Dom. Ste. Michelle is wine designed for mass consumer appeal. Dom Perignon is a French wine that is not designed to taste fruity and gulpable – its more of a niche product. Also – were the blind tasters all American? American and French tastes are very different.

    But I’d take the Ste. Michelle over the Dom any day.

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  7. no name yet again says:

    Oh yes, JP–you seem a bit skeptical yourself as – if the person happens to be a student asking a question that she/he does not know the answer to, the student could not possibly be asking a good question–. Well, my friend- here this! if you ever get a teacher like that- I would drop the course asap. And if you cannot or don’t want to- just remember- the best questions come from students. It’s a teacher’s job to listen. And if the teacher doesn’t or cannot (for whatever reasons), go find the answer for yourself- I had no choice in the matter. And am happy to say, it has worked out.

    And Browning- I would like to be optimistic, but I too am still skeptical.

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  8. scott cunningham says:

    You wrote, “Not until I read Goldstein’s book did I realize just how weak the correlation was in blind tastings between expert evaluations and price in experimental settings.”

    Unless I’m missing something, the paper you linked to earlier – which uses the same data as the book – finds a strong positive correlation between identified “experts (eg, people who have taken a class on wine) and preference. It’s for the non-experts that there is a negative correlation.

    I guess I keep thinking this is just evidence for human capital in wine appreciation, much like in Becker and Stigler’s “De Gustibus…’ paper where they say the same exists for appreciation of classical music.

    That said, Robert Parker of the Wine Advocate explains his method, which involves blind tastes.

    http://www.erobertparker.com/info/legend.asp

    “When possible all of my tastings are done in peer-group, single-blind conditions, (meaning that the same types of wines are tasted against each other and the producers’ names are not known). The ratings reflect an independent, critical look at the wines. Neither price nor the reputation of the producer/grower affect the rating in any manner.”

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