The impact of chemical and sensorial characteristics on the market price of Italian red wines

Abstract

The hedonic price analysis presented in this paper is carried out on a dataset containing observable, sensory and chemical characteristics of a sample of Italian red wines. The study starts from the commonly observed evidence that in general the market price can be explained by the objective characteristics appearing on the label of the bottle and not by the wine's quality. The aim of the analysis is to discover how quality matters. This objective is pursued by means of the construction of latent sensory and chemical factors, whose implicit value, quantified using Random Forest variable importance measures, turns out to be appreciably high.