Projects Funded for -

WIC Program's Effect on Infant Formula Prices and Sales

Jeffrey Perloff

Water Distribution: Experiments on the Interaction of Type and Structure

Richard Sexton

The Potential Impact of Global Warming on Irrigated Agriculture in California

Anthony Fisher

The Impact of Information via Expert Opinions on Consumer Purchase Patterns

Sofia Villas-Boas


There exists a large literature that analyzes the impact of expert opinion on consumer choice and demand for experience goods. Due to the non-experimental nature of most prior studies, endogeneity is a concern. Specifically, there is likely a spurious correlation between good reviews and high product demand that exists because of an underlying correlation with unobservable quality signals. This paper avoids such obstacles through an experiment approach.

Specifically, this study examines the impact of expert opinion on retail wine purchases. Anecdotal evidence suggests that consumers are largely uninformed regarding the quality of wine products: thus, wine is an experience good. There exist many sources of expert opinion for wine, including Wine Spectator and the Wine Advocate, which have reviews for more than 300,000 wines. However, little is known regarding the impact of such expert reviews.

To examine the impact of expert opinion, we utilize an experimental approach at a large national retail grocery chain. In particular, wines in two retail stores in Northern California were randomly chosen to display wine scores from the Wine Spectator and Wine Advocate. Wine opinion labels were displayed for one month during Spring 2006 for 200 wines. Wine sales in the treated stores were then compared to sales of these wines in stores that displayed similar trends in wine sales both before and after the
treatment period.

We find that while demand decreases for wines that receive low scores, demand for average- and higher-than-average-scored wines increases. The results indicate that expert opinion labels transmit quality information that affects demand as opposed to solely increasing the wine's shelf visibility to the consumer.

These results have important implications for understanding how to effectively market wine and other consumer products reach and influence consumer behavior. Specifically, our results demonstrate that expert opinion labels can substantially increase wine sales. More broadly, for products where consumers' product knowledge is incomplete, the display of quality information may induce consumers to enter the market or to purchase such products on a more regular basis.

The Effect of Land Trusts on Land Allocation and Housing Prices in California

Gordon Rausser

The Causes and Consequences of Rural to Urban Migration in Mexico and China and the Implications for the U.S. (California)

J. Edward Taylor, Scott Rozelle, and Steve Boucher

The California Strawberry Industry's Response to State Regulation of Methyl Bromide

Colin Carter and James Chalfant

Microfilm Preservation Project, UC Berkeley's Giannini Foundation Library

Susan Garbarino

Impacts of Developed-Country Food Quality Standards on Agriculture in Developing Countries: Application to the Pineapple Industry in Ghana.

Lovell Jarvis and Richard Sexton

Explaining Spatial and Temporal Variation in California Gasoline and Diesel Prices

Aaron Smith

Environmental Quality in California: The Role of Economic, Social, and Political Factors

Y. Hossein Farzin


This study examines the relationships between water quality and socio-economic-demographic factors in California at the county level using 24 water quality indicators coming from seven different types of bodies of water. It estimates three classes of models: the traditional per capita income-pollution level specifications (the environmental Kuznets curve, EKC), a more inclusive model containing main socio-economic-demographic variables, and a model that includes these variables while accounting for spatial correlations too. For most water quality indicators, it does not find support for income-pollution specifications. For pollutants like phosphorous and total suspended solids, the level of agricultural activity is a significant determinant of water quality in California. However, for other surface water pollutants commonly considered agricultural pollutants, such as ammonia and nitrate, the level of agricultural activity is not statistically significant. Additionally, education, ethnic composition, age structure, and water area are all significantly correlated with various
indicators of water quality.

Economic Analysis of Strategies for Reducing Volatile Organic Compound Emissions from Pesticide Use in the San Joaquin Valley

Rachael Goodhue

Does the USDA Make Us Fat?

Julian Alston

Does Patent Protection Lead to More and Faster Development of University Innovation? Evidence from Management of Ag-biotech Inventions by UC TTO

Brian Wright

Changes to the "Width of the Border" and the Export Competitiveness of California Agriculture

Ethan A. Ligon

California Regional Winegrape Price Determination

Arthur Havenner

Bilateral Free Trade Agreements, the Future of International Agriculture Trade? The Effects of a U.S.-Malaysia FTA on the California Lumber Industry and Implications for Other California Agriculture Exports

Alex McCalla

Adoption and Potential Precision Farming in California Agriculture

David Zilberman

Adapting to Water Shortages in Northern China: Institutional Change in Irrigation Management and Water Saving Technology Adoption

Richard Howitt and Scott Rozelle

A Preliminary Investigation of Demand Determinants for California Nursery and Floral Products

Hoy Carman

A Comparison of Farmland Conservation Programs in California

Douglas Larson