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Is the second-cheapest wine a rip-off?

De Meza, David and Pathania, Vikram S. (2021) Is the second-cheapest wine a rip-off? Economics Letters, 205. ISSN 0165-1765

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Identification Number: 10.1016/j.econlet.2021.109965

Abstract

The second-cheapest bottle on a restaurant wine list is widely thought to be priced to exploit naïve diners embarrassed to choose the cheapest option. This paper investigates whether this behavioral theory holds empirically. We find that the mark-up on the second-cheapest wine is significantly below that on the four next most expensive wines. It is therefore an urban myth that the second-cheapest wine is an especially bad buy.

Item Type: Article
Official URL: https://www.journals.elsevier.com/economics-letter...
Additional Information: © 2021 Elsevier B.V.
Divisions: Management
Subjects: B Philosophy. Psychology. Religion > BF Psychology
H Social Sciences > HB Economic Theory
Date Deposited: 18 Jun 2021 08:57
Last Modified: 20 Jul 2021 01:31
URI: http://eprints.lse.ac.uk/id/eprint/110874

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