The price of wine

Elroy Dimson, Peter Rousseau and Christophe Spaenjers

Journal of Financial Economics, 2015, vol. 118, issue 2, 431-449

Abstract: Using historical price records for Bordeaux Premiers Crus, we examine the impact of aging on wine prices and the long-term investment performance of fine wine. In line with the predictions of an illustrative model, young maturing wines from high-quality vintages provide the highest financial returns. Past maturity, famous châteaus deliver growing non-pecuniary benefits to their owners. Using an arithmetic repeat-sales regression over 1900–2012, we estimate a real financial return to wine investment (net of storage costs) of 4.1%, which exceeds bonds, art, and stamps. Returns to wine and equities are positively correlated. Finally, we find evidence of in-sample return predictability.

Keywords: Wine prices; Alternative investments; Price indexes; Psychic return; Bubbles (search for similar items in EconPapers)
JEL-codes: C43 D44 G11 G12 Q11 Z11 (search for similar items in EconPapers)
Date: 2015
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Citations: View citations in EconPapers (31)

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Related works:
Working Paper: The Price of Wine (2013)
Working Paper: The Price of Wine (2013)
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Persistent link: https://EconPapers.repec.org/RePEc:eee:jfinec:v:118:y:2015:i:2:p:431-449

DOI: 10.1016/j.jfineco.2015.08.005

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