Regional determinants of Hungarian wine prices: The role of geographical indications, objective quality and individual reputation

Analysing the determinants of wine prices has always been a field interest in economics literature. By estimating hedonic price functions, however, most papers generally remain at country level with regions neglected or treated as simple dummy variables. The aim this paper is to analyse regional by using Latent Variable Path Modelling Partial Least Squares and Principal Component Analysis on example Hungarian wines. This approach able capture specialties production provides better insight into determination. Results suggest that intrinsic values play major but ambiguous role determining prices, especially case sugar content. It also becomes apparent specific Geographical Indications (GIs) crucial determination, instead GI use per se. Moreover, individual brands have an important role, Tier1 Tier2 wineries tend sell their wines higher smaller batch sizes.