The Influence of Wine Expert's On-Line Ratings on Retail Price of On-Premise Market in Korea

Abstract

Quality of wines can be evaluated in 4 different ways; I) Subjective evaluation by experts, 2) Subjective evaluation by consumers, 3) Objective evaluation by rating agencies on a regular basis, and 4) Objective evaluation by rating agencies on a temporary basis. The purpose of this study is to explore the influence of subjective evaluation on quality of wines by wine experts on retail prices in Korean wine market. This study focused on empirically the influence of 'Robert Parker Scores' which are revealed on a website owned by Robert Parker Jr., known as the most influential wine critic in the world on retail prices of 1.039 wines produced in 3 different countries, and sold in 7 restaurants of hotels and wine bars in Korea. Furthermore, this study empirically analyzed relative importance of influences that vintage data and Parker Score affect on retail price of on-premise market. As a result, this study extended previous research on influence of experts' evaluation result (Parker Score) on wholesale price level to retail price level. Furthermore, this study also extended previous researches on influence of Parker Score on Bordeaux wines only to wines produced in various wine producing regions of France, Italy, and USA: Champagne, Burgandy, Rhone, Piemonte, Toscana, and California..