Prices as Quality Signals: Evidence from the Wine Market
Identifieur interne : 001B01 ( Istex/Corpus ); précédent : 001B00; suivant : 001B02Prices as Quality Signals: Evidence from the Wine Market
Auteurs : Hubert Schnabel ; Karl StorchmannSource :
- Journal of Agricultural & Food Industrial Organization [ 1542-0485 ] ; 2010-02-08.
Abstract
In this paper we empirically analyze whether prices serve as signals. Specifically, and following the hypothesis by Bagwell and Riordan (1991), we examine whether (1) higher quality and (2) low consumer information levels about quality are associated with prices that are above the full information equilibrium. We refer to two price samples of identical wines and analyze the difference between both. The first sample consists of prices for informed wholesalers who can taste the wines before purchase. The second sample comprises retail prices for the imperfectly informed public. We find support for the Bagwell-Riordan model, i.e., price signals respond positively to wine quality and negatively to increasing information. For our sample, the information effect by far dominates the quality effect.
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DOI: 10.2202/1542-0485.1283
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Specifically, and following the hypothesis by Bagwell and Riordan (1991), we examine whether (1) higher quality and (2) low consumer information levels about quality are associated with prices that are above the full information equilibrium. We refer to two price samples of identical wines and analyze the difference between both. The first sample consists of prices for informed wholesalers who can taste the wines before purchase. The second sample comprises retail prices for the imperfectly informed public. We find support for the Bagwell-Riordan model, i.e., price signals respond positively to wine quality and negatively to increasing information. For our sample, the information effect by far dominates the quality effect.</div></front></TEI><istex><corpusName>degruyter-journals</corpusName><author><json:item><name>Hubert Schnabel</name><affiliations><json:string>Vereinigte Hospitien Trier</json:string></affiliations></json:item><json:item><name>Karl Storchmann</name><affiliations><json:string>New York University</json:string></affiliations></json:item></author><subject><json:item><lang><json:string>eng</json:string></lang><value>wine economics</value></json:item><json:item><lang><json:string>eng</json:string></lang><value>industrial organization</value></json:item><json:item><lang><json:string>eng</json:string></lang><value>wine pricing</value></json:item><json:item><lang><json:string>eng</json:string></lang><value>signaling</value></json:item><json:item><lang><json:string>eng</json:string></lang><value>retail margin</value></json:item><json:item><lang><json:string>eng</json:string></lang><value>information</value></json:item><json:item><lang><json:string>eng</json:string></lang><value>wine</value></json:item><json:item><lang><json:string>eng</json:string></lang><value>price signals</value></json:item></subject><articleId><json:string>1542-0485.1283</json:string></articleId><language><json:string>eng</json:string></language><originalGenre><json:string>research-article</json:string></originalGenre><abstract>In this paper we empirically analyze whether prices serve as signals. Specifically, and following the hypothesis by Bagwell and Riordan (1991), we examine whether (1) higher quality and (2) low consumer information levels about quality are associated with prices that are above the full information equilibrium. We refer to two price samples of identical wines and analyze the difference between both. The first sample consists of prices for informed wholesalers who can taste the wines before purchase. The second sample comprises retail prices for the imperfectly informed public. We find support for the Bagwell-Riordan model, i.e., price signals respond positively to wine quality and negatively to increasing information. 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Organization</title></host><publicationDate>2010</publicationDate><copyrightDate>2010</copyrightDate><doi><json:string>10.2202/1542-0485.1283</json:string></doi><id>B93D14D1A8405D428B726B3675E3C04BECD44625</id><score>0.7238438</score><fulltext><json:item><extension>pdf</extension><original>true</original><mimetype>application/pdf</mimetype><uri>https://api.istex.fr/document/B93D14D1A8405D428B726B3675E3C04BECD44625/fulltext/pdf</uri></json:item><json:item><extension>zip</extension><original>false</original><mimetype>application/zip</mimetype><uri>https://api.istex.fr/document/B93D14D1A8405D428B726B3675E3C04BECD44625/fulltext/zip</uri></json:item><istex:fulltextTEI uri="https://api.istex.fr/document/B93D14D1A8405D428B726B3675E3C04BECD44625/fulltext/tei"><teiHeader><fileDesc><titleStmt><title level="a" type="main" xml:lang="en">Prices as Quality Signals: Evidence from the Wine Market</title><respStmt><resp>Références bibliographiques récupérées via GROBID</resp><name 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KG, Berlin/Boston</p></availability><date>2010-02-08</date></publicationStmt><sourceDesc><biblStruct type="inbook"><analytic><title level="a" type="main" xml:lang="en">Prices as Quality Signals: Evidence from the Wine Market</title><author xml:id="author-1"><persName><forename type="first">Hubert</forename><surname>Schnabel</surname></persName><affiliation>Vereinigte Hospitien Trier</affiliation></author><author xml:id="author-2"><persName><forename type="first">Karl</forename><surname>Storchmann</surname></persName><affiliation>New York University</affiliation></author></analytic><monogr><title level="j">Journal of Agricultural & Food Industrial Organization</title><idno type="eISSN">1542-0485</idno><imprint><publisher>De Gruyter</publisher><date type="published" when="2010-02-08"></date><biblScope unit="volume">8</biblScope><biblScope unit="issue">1</biblScope></imprint></monogr><idno type="istex">B93D14D1A8405D428B726B3675E3C04BECD44625</idno><idno type="DOI">10.2202/1542-0485.1283</idno><idno type="ArticleID">1542-0485.1283</idno><idno type="pdf">jafio.2010.8.1.1283.pdf</idno></biblStruct></sourceDesc></fileDesc><profileDesc><creation><date>2010-02-08</date></creation><langUsage><language ident="en">en</language></langUsage><abstract xml:lang="en"><p>In this paper we empirically analyze whether prices serve as signals. Specifically, and following the hypothesis by Bagwell and Riordan (1991), we examine whether (1) higher quality and (2) low consumer information levels about quality are associated with prices that are above the full information equilibrium. We refer to two price samples of identical wines and analyze the difference between both. The first sample consists of prices for informed wholesalers who can taste the wines before purchase. The second sample comprises retail prices for the imperfectly informed public. We find support for the Bagwell-Riordan model, i.e., price signals respond positively to wine quality and negatively to increasing information. For our sample, the information effect by far dominates the quality effect.</p></abstract><textClass><keywords scheme="keyword"><list><item><term>wine economics</term></item><item><term>industrial organization</term></item><item><term>wine pricing</term></item><item><term>signaling</term></item><item><term>retail margin</term></item><item><term>information</term></item></list></keywords></textClass><textClass><keywords scheme="keyword"><list><head>Keywords</head><item><term>wine</term></item><item><term>price signals</term></item></list></keywords></textClass></profileDesc><revisionDesc><change when="2010-02-08">Created</change><change when="2010-02-08">Published</change><change xml:id="refBibs-istex" who="#ISTEX-API" when="2017-01-17">References added</change></revisionDesc></teiHeader></istex:fulltextTEI><json:item><extension>txt</extension><original>false</original><mimetype>text/plain</mimetype><uri>https://api.istex.fr/document/B93D14D1A8405D428B726B3675E3C04BECD44625/fulltext/txt</uri></json:item></fulltext><metadata><istex:metadataXml wicri:clean="corpus degruyter-journals" wicri:toSee="no header"><istex:xmlDeclaration>version="1.0" encoding="utf-8"</istex:xmlDeclaration><istex:docType PUBLIC="-//Atypon//DTD Atypon Systems Journal Archiving and Interchange NLM DTD v3.0.2 20101108//EN" URI="atypon_archive-interchange-dtd-3.0.2/atypon-archivearticle3.dtd" name="istex:docType"></istex:docType><istex:document><article article-type="research-article" dtd-version="3.0" xml:lang="EN"><front><journal-meta><journal-id journal-id-type="publisher-id">jafio</journal-id><journal-title-group><journal-title>Journal of Agricultural & Food Industrial Organization</journal-title></journal-title-group><issn pub-type="epub">1542-0485</issn><publisher><publisher-name>De Gruyter</publisher-name></publisher></journal-meta><article-meta><article-id pub-id-type="publisher-id">1542-0485.1283</article-id><article-id pub-id-type="doi">10.2202/1542-0485.1283</article-id><article-categories><subj-group subj-group-type="heading"><subject>Article</subject></subj-group><subj-group><subject>wine economics</subject><subject>industrial organization</subject><subject>wine pricing</subject><subject>signaling</subject><subject>retail margin</subject><subject>information</subject></subj-group></article-categories><title-group><article-title>Prices as Quality Signals: Evidence from the Wine Market</article-title></title-group><contrib-group><contrib contrib-type="author"><name><surname>Schnabel</surname><given-names>Hubert</given-names></name><aff id="a1"><italic>Vereinigte Hospitien Trier</italic></aff></contrib><contrib contrib-type="author"><name><surname>Storchmann</surname><given-names>Karl</given-names></name><aff id="a2"><italic>New York University</italic></aff></contrib></contrib-group><pub-date pub-type="epub"><day>8</day><month>2</month><year>2010</year></pub-date><volume>8</volume><issue>1</issue><permissions><copyright-statement>©2011 Walter de Gruyter GmbH & Co. KG, Berlin/Boston</copyright-statement><copyright-year>2011</copyright-year></permissions><related-article related-article-type="pdf" xlink:href="jafio.2010.8.1.1283.pdf"></related-article><abstract><p>In this paper we empirically analyze whether prices serve as signals. Specifically, and following the hypothesis by Bagwell and Riordan (1991), we examine whether (1) higher quality and (2) low consumer information levels about quality are associated with prices that are above the full information equilibrium. We refer to two price samples of identical wines and analyze the difference between both. The first sample consists of prices for informed wholesalers who can taste the wines before purchase. The second sample comprises retail prices for the imperfectly informed public. We find support for the Bagwell-Riordan model, i.e., price signals respond positively to wine quality and negatively to increasing information. For our sample, the information effect by far dominates the quality effect.</p></abstract><kwd-group><title>Keywords</title><kwd>wine</kwd><x>, </x><kwd>price signals</kwd></kwd-group><counts><page-count count="23"></page-count></counts></article-meta></front></article></istex:document></istex:metadataXml><mods version="3.6"><titleInfo lang="en"><title>Prices as Quality Signals: Evidence from the Wine Market</title></titleInfo><titleInfo type="alternative" lang="en" contentType="CDATA"><title>Prices as Quality Signals: Evidence from the Wine Market</title></titleInfo><name type="personal"><namePart type="given">Hubert</namePart><namePart type="family">Schnabel</namePart><affiliation>Vereinigte Hospitien Trier</affiliation><role><roleTerm type="text">author</roleTerm></role></name><name type="personal"><namePart type="given">Karl</namePart><namePart type="family">Storchmann</namePart><affiliation>New York University</affiliation><role><roleTerm type="text">author</roleTerm></role></name><typeOfResource>text</typeOfResource><genre type="research-article" displayLabel="research-article"></genre><subject><topic>wine economics</topic><topic>industrial organization</topic><topic>wine pricing</topic><topic>signaling</topic><topic>retail margin</topic><topic>information</topic></subject><originInfo><publisher>De Gruyter</publisher><dateIssued encoding="w3cdtf">2010-02-08</dateIssued><dateCreated encoding="w3cdtf">2010-02-08</dateCreated><copyrightDate encoding="w3cdtf">2010</copyrightDate></originInfo><language><languageTerm type="code" authority="iso639-2b">eng</languageTerm><languageTerm type="code" authority="rfc3066">en</languageTerm></language><physicalDescription><internetMediaType>text/html</internetMediaType></physicalDescription><abstract lang="en">In this paper we empirically analyze whether prices serve as signals. Specifically, and following the hypothesis by Bagwell and Riordan (1991), we examine whether (1) higher quality and (2) low consumer information levels about quality are associated with prices that are above the full information equilibrium. We refer to two price samples of identical wines and analyze the difference between both. The first sample consists of prices for informed wholesalers who can taste the wines before purchase. The second sample comprises retail prices for the imperfectly informed public. We find support for the Bagwell-Riordan model, i.e., price signals respond positively to wine quality and negatively to increasing information. For our sample, the information effect by far dominates the quality effect.</abstract><subject><genre>Keywords</genre><topic>wine</topic><topic>price signals</topic></subject><relatedItem type="host"><titleInfo><title>Journal of Agricultural & Food Industrial Organization</title></titleInfo><genre type="journal">journal</genre><identifier type="eISSN">1542-0485</identifier><identifier type="PublisherID">jafio</identifier><part><date>2010</date><detail type="volume"><caption>vol.</caption><number>8</number></detail><detail type="issue"><caption>no.</caption><number>1</number></detail><extent unit="pages"><total>23</total></extent></part></relatedItem><identifier type="istex">B93D14D1A8405D428B726B3675E3C04BECD44625</identifier><identifier type="DOI">10.2202/1542-0485.1283</identifier><identifier type="ArticleID">1542-0485.1283</identifier><identifier type="pdf">jafio.2010.8.1.1283.pdf</identifier><accessCondition type="use and reproduction" contentType="copyright">©2011 Walter de Gruyter GmbH & Co. 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