Is Award-winning Wine Worth It?

Medals are a good thing, right? Whether it’s in the Olympics or in the wine cellar, you always go for gold. While we’ll hear more about figure skating in February, a new study by the American Association of Wine Economists (AAWE) suggests that actually, award-winning wine might have some unforeseen drawbacks.

In their recently published research paper, Emmanuel Paroissien and Michael Visser sought to find out if there is a causal effect between a wine winning a medal at a competition and an increase in price of that wine. They compared the price of a selection of Bordeaux wines before and after eleven competitions and found that, after winning a medal in a competition, a French wine’s price increases, on average, by 13 percent.

While this is certainly a significant bump, the two researchers went a step further and examined if the bump was a big enough to offset the costs of entering into these competitions. They balanced the increase in the revenue against participation fees, the cost of sending their wine to the venue, even the price of the stickers for their bottles that announces the medal win. What the study found was, on average, the profits made do overcome the related costs, confirming the competitions’ value.

The third and final part to their research, however, was to see if their data suggested that gold medals are reliably awarded to the best wines. While they did no direct testing on the topic, their examination of the data seems to only further confirm what previous studies have concluded. In Paroisseien and Visser’s words, “[They found] that only a minority of contests attribute medals that are significantly correlated with wine quality.”

So, as it turns out, those competitions medals come with some extra baggage. It makes the wine more expensive while not necessarily guaranteeing that it will be “The Best”. Plus, there are only incentives for wine producers to enter into these competitions, so the contests are sticking around. This, of course, doesn’t mean the wine isn’t good. Paroissien and Visser looked at some of the most prestigious competitions in the world, so it’s unlikely that these bottles will be duds. What it does mean, though, is that maybe we ought to pay more attention to up and coming vineyards and invest in a couple bottles before they get that gold…

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