Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/207121
Authors: 
Pennerstorfer, Dieter
Weiss, Christoph R.
Huber, Andreas
Year of Publication: 
2019
Series/Report no.: 
Working Paper 1908
Abstract: 
We investigate the relationship between external quality evaluation via experts, firm reputation and product prices and extend the existing empirical literature in three dimensions. First, we empirically account for endogenous reputation effects. An increase in quality has an immediate positive impact on product prices but also improves the reputation of a firm, which contributes to higher prices in the future. Secondly, we analyse umbrella effects of reputation: investments in product quality of the "top product" are particularly profitable as they also generate a "reputational dividend" for other products with lower quality. And finally, we investigate selection effects in expert evaluations. Experts typically evaluate a selection of products only and we find endogenous selection effects to be important for analysing product quality empirically.
Subjects: 
experts evaluations
hedonic pricing
wine quality
endogenous reputation
sample selection
umbrella branding
JEL: 
C33
L66
Q11
Document Type: 
Working Paper

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