are significantly different at the 1 per cent level and
another four at the 5 per cent level.7 This pattern
indicates of an intensifying regional quality differentiation
in Australia, with coefficients for some
regions trending down while others are trending up.
For example, the coefficients for wines from
Tasmania first become significant in 1998 and then
increase further as they became more popular with
consumers relative to Barossa Valley wines. Strong
upward trends are also evident for the newly developing
ultra-premium cool-climate regions of the
Adelaide Hills, Mornington Peninsula and Yarra
Valley, with average premia up to 31 per cent. By way
of contrast, the wines of the warm-climate irrigated
region such as Other South Australia and Riverina
become heavily discounted by the mid-1990s.
Turning to the estimates for the Winestate data
(Table 6), the parameters for vintage rating are all
significant but less constant over time compared to
the Halliday coefficients. The price premium varies
between 4 and 16 per cent for a -star improvement
in the sensory quality rating for the 1993–99 vintages.
That is, a -star increase in Winestate’s rating would
yield an increase in the price per bottle between 65
and 312 cents on an average-priced bottle of rated
wine for the 1992–99 vintages (see last row in
Table 6). Unfortunately, the rating schemes are too
different to allow a direct comparison of the price
premia in the two data sets, since Winestate only
publishes ratings of three or more stars and the two
data providers vary in the extent to which they focus
on commercial, super- and ultra-premium wines
(as reflected in their different average prices).
For the variety dummies, the Winestate data confirm
that the Semillon and Sauvignon Blanc parameters
become less unpopular relative to Barossa Valley
Shiraz over the latter 1990s. On average, the Winestate
data also confirm that they attract about a
one-third discount relative to Barossa Shiraz, other
things equal, with both coefficients following the
declining discount trends observed with the Halliday
data. For Chardonnay the discounts are slightly
higher in the Winestate sample whereas for Riesling
they are slightly lower. Among the reds, Merlot
attracted similar prices to Shiraz (less than 5 per
cent significance), but other red varieties including
blends of Cabernet and Shiraz showed significant
discounts below the Barossa Shiraz price, other things
equal. Compared to the results from Halliday’s data