Keith Levenberg weighs in on the economics of wine with a very smart insight:
If one aims to study “the welfare gains” to wine consumers, measured in those magic units of happiness that economists and philosophers call “utils,” then one should focus on serious wine drinkers, not “average” wine drinkers. It stands to reason that the more seriously one is interested in wine, the more of his total welfare is derived from the pleasures of wine in comparison to the “average” consumer. Limiting one’s study to the welfare of “average” consumers therefore measures only a small proportion of the total welfare derived from the product, and a small gain in the welfare of those who don’t care much about it may disguise an enormous decline in the welfare of those who care about it a whole lot. Which, if you’ve been paying any attention to wine prices the last few years, is pretty much what happened.
I believe that there is a negative correlation between wine price and quality – but I don’t believe that holds for, say, Robert Parker. And in general, the more of a "serious wine drinker" you are, the more the probability rises that, for you, there will be a positive correlation between the two.
It’s never a certainty: I know a lot of pretty serious wine drinkers who have displayed a negative correlation in blind tastings. But remember that the overwhelming majority of tastings aren’t blind: we nearly always have a pretty good idea of how much (roughly) the wine we’re drinking costs. And it’s a well-known fact that simply knowing that the wine you’re drinking is expensive is, in and of itself, sufficient to raise your enjoyment of that wine.
So it’s quite uncontroversial to assert that most of the enjoyment of wine, in (let’s say) "utils", is concentrated in a minority of wine-lovers who spend a relatively large amount of money on the stuff. It’s also pretty uncontroversial to assert that those wine lovers tend to love most the most celebrated wines – i.e., the most expensive wines. And it’s simple fact that the most expensive wines have soared in price over the past decade or two.
Now, it’s probably fair to say that a bottle of 1982 Lafite tastes better, subjectively, if you just paid $3,000 for it than if you just paid $150 for it. But on a dollar-per-util basis, there’s no doubt you’re getting less bang for your buck. Which means that Levenberg’s entirely right: while those of us with a relatively happy-go-lucky approach to wine might well have benefitted from globalization over the past 20 years, the serious wine lovers among us can only look back wistfully at prices in the 70s and early 80s, and curse themselves for not buying much, much more back then.