Do whisky investors read the Bible?

Photo : Do whisky investors read the Bible?

Whisky has become a relevant investment opportunity for both individual and institutional investors. However, if you decide to invest in this specific asset but don’t know anything to the whisky industry, how can you inform about the most profitable bottles?

A solution can consist in relying on bottle evaluations made by whisky experts, like those provided by Jim Murray in his Whisky Bible, the whisky equivalent of the Parker’s Wine Buyer’s Guide. We can yet also wonder if the tasting evaluations obtained by a given distillery have an impact on the valuation of its bottles on the investment market.

The article of David Moroz and Bruno Pecchioli published recently in the Journal of Wine Economics, “Do Whisky Investors Read the Bible? The Effect of Expert Ratings on the Vintage Single Malt Secondary Market”, aims precisely to estimate the effect of expert assessments on the prices for single malt Scotch whiskies on the investment market.

Their results, obtained with an original dataset combining data from Jim Murray’s Whisky Bible and a web trading platform specializing in whisky investment, show that the quality rating is not a powerful predictor of investor ask prices, especially when controlling for distillery and bottler reputation.

Their findings suggest that although the Murray score of a bottle may embed information of use to unsophisticated investors, its effect on price can be outperformed by a detailed knowledge of the whisky industry. 

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    David Moroz David Moroz is an Associate Professor of Economics. He joined EM Normandie in 2020. Il has a PhD in economics, awarded in 2003 by the Université de Reims Champagne-Ardenne. He wrote his thesis on the issues related to defining property rights to the human genome. His research interests are understanding the dynamics of cultural change with a particular focus on alternative investment markets. His articles analyse the foundations of reputation in the alcoholic beverages market, namely spirits.

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