Abstract
Assuming that wine markets are efficient, ultimately a bottle of wine’s cost and therefore its price should reflect its vintage, grape variety as well as how it is vinified. Yet, being an experiential good, a wine’s price is also closely related to its place of origin. If the designated viticultural area of wine is coming from is not considered, even in a relatively new wine country, wine makers may end up over-estimating the premium attached to vintage, variety as well as how it is vinified. Regression results indicate that, for Ontario wines, the over-estimations vary between 1% points and 18% points.
Highlights
Canadian wine was almost an oxymoron. Other than its infamous ice wine, even wellinformed wine drinkers were not aware of Canadian wines
Until recently, Canadian wine was almost an oxymoron
First, as an ad-hoc regression model, the real price of each bottle of Ontario wine is set as a function of vintage, variety, and vinification2 without taking appellations differences into account
Summary
Canadian wine was almost an oxymoron. Other than its infamous ice wine, even wellinformed wine drinkers were not aware of Canadian wines. For 4,213 table wines from Ontario wine region, between 2015-2018, we have information regarding their retail price, vintage, size, grape variety(ies), appellation, as well as vinification— whether they are from a name vineyard or estate bottled.
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