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When Does The Price Affect The Taste? Results From A Wine Experiment

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  • Almenberg, Johan
  • Dreber, Anna

Abstract

We designed an experiment that examines how knowledge about the price of a good, and the time at which the information is received, affects how the good is experienced. The good in question was wine, and the price was either high or low. Our results suggest that hosts offering wine to guests can safely reveal the price: much is gained if the wine is expensive, and little is lost if it is cheap. Disclosing the high price before tasting the wine produces considerably higher ratings, although only from women. Disclosing the low price, by contrast, does not result in lower ratings. Our finding indicates that price not only serves to clear markets, it also serves as a marketing tool; it influences expectations that in turn shape a consumer’s experience. In addition, our results suggest that men and women respond differently to attribute information.

Suggested Citation

  • Almenberg, Johan & Dreber, Anna, 2009. "When Does The Price Affect The Taste? Results From A Wine Experiment," Working Papers 51755, American Association of Wine Economists.
    • Handle: RePEc:ags:aawewp:51755
    DOI: 10.22004/ag.econ.51755
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    Cited by:

    1. Caracciolo, Francesco & D’Amico, Mario & Di Vita, Giuseppe & Pomarici, Eugenio & Dal Bianco, Andrea & Cembalo, Luigi, 2016. "Private vs. Collective Wine Reputation," International Food and Agribusiness Management Review, International Food and Agribusiness Management Association, vol. 19(3), pages 1-20, August.
    2. Costanigro, Marco & Scozzafava, Gabriele & Casini, Leonardo, 2019. "Vertical differentiation via multi-tier geographical indications and the consumer perception of quality: The case of Chianti wines," Food Policy, Elsevier, vol. 83(C), pages 246-259.
    3. Clarissa Laura Maria Spiess Bru, 2023. "Does the Tasting Note Matter? Language Categories and Their Impact on Professional Ratings and Prices," Working Papers Dissertations 105, Paderborn University, Faculty of Business Administration and Economics.
    4. Gustafson, Christopher R. & Lybbert, Travis J. & Sumner, Daniel A., 2016. "Consumer knowledge affects valuation of product attributes: Experimental results for wine," Journal of Behavioral and Experimental Economics (formerly The Journal of Socio-Economics), Elsevier, vol. 65(C), pages 85-94.
    5. Jan Zavodny Pospisil & Lucie Sara Zavodna & Matej Jiranek, 2020. "Does the Packaging Change the Perceived Taste of Beer? Results from a Beer Experiment," Tržište/Market, Faculty of Economics and Business, University of Zagreb, vol. 32(1), pages 65-78.
    6. Sanjiv Erat & Sreekumar R. Bhaskaran, 2012. "Consumer Mental Accounts and Implications to Selling Base Products and Add-ons," Marketing Science, INFORMS, vol. 31(5), pages 801-818, September.
    7. Zander, K. & Janssen, M., 2013. "Präferenzen deutscher Öko-Konsumenten für Wein," Proceedings “Schriften der Gesellschaft für Wirtschafts- und Sozialwissenschaften des Landbaues e.V.”, German Association of Agricultural Economists (GEWISOLA), vol. 48, March.
    8. Liesbeth Colen & George Chryssochoidis & Pavel Ciaian & Federica Di Marcantonio, 2020. "Differences in composition of seemingly identical branded products: Impact on consumer purchase decisions and welfare," JRC Research Reports JRC118149, Joint Research Centre.
    9. Rössel, Jörg & Beckert, Jens, 2012. "Quality classifications in competition: Price formation in the German wine market," MPIfG Discussion Paper 12/3, Max Planck Institute for the Study of Societies.
    10. Ahmed H. Alsharif & Nor Zafir Md Salleh & Mazilah Abdullah & Ahmad Khraiwish & Azmirul Ashaari, 2023. "Neuromarketing Tools Used in the Marketing Mix: A Systematic Literature and Future Research Agenda," SAGE Open, , vol. 13(1), pages 21582440231, February.

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    More about this item

    Keywords

    Consumer/Household Economics; Demand and Price Analysis;

    JEL classification:

    • C91 - Mathematical and Quantitative Methods - - Design of Experiments - - - Laboratory, Individual Behavior
    • D03 - Microeconomics - - General - - - Behavioral Microeconomics: Underlying Principles
    • D83 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Search; Learning; Information and Knowledge; Communication; Belief; Unawareness
    • M31 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Marketing and Advertising - - - Marketing

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