Working Paper Abstract

Bordeaux Wine Vintage Quality and Weather
Orley Ashenfelter, David Ashmore, and Robert LaLonde
 

Abstract:
In this article we show that the quality of the vintage for red Bordeaux wines, as judged by the prices of mature wines, can be predicted by the weather during the growing season that produced the wines. Red Bordeaux wines have been produced in the same place and much the same way for hundreds of years. When young, the wines from the best vineyards are astringent, and many people find them unpleasant to consume. As these wines age, they lose their astringency, and many people find them very pleasant to consume. Because Bordeaux wines taste better when they are older, there is an incentive to store the young wines until they are mature. As a result, there is an active market in young wines (similar to "new issues" in the securities markets) and an active market in older wines (similar to the secondary markets in securities).

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