The political economy of price and status formation in the Bordeaux en primeur market: the role of wine critics as rating agencies

Political economists and economic sociologists remain thoroughly divided on the anticipated impact of the globalization of markets on their institutional form and character. In this paper, I extend and update earlier work on the en primeur market for Bordeaux wines, examining empirically the impact of the demonstrable globalization of the process of price formation on the institutional character of this most densely institutionalized of markets. I associate the process of globalization in this market with the influence of international wine critics, assessing the extent to which they might be seen to act in effect as agents of standardization in a market whose prices are more conventionally seen to be driven by the status and hierarchy bound up with long-standing systems of classification. I compare and contrast the 2005 en primeur campaign which took place in the midst of a global consumer boom which had seen so-called investment grade wines command unprecedented prices in international markets with the 2008 campaign which took place in a context of global recession, examining the role played by American wine critic Robert Parker in the process of price formation in each campaign. I show that Parker's impact has not waned, that he can be shown to exert a strong influence on both intra-vintage and inter-vintage reputational factors and that his role is analogous to that of a credit-rating agency in a more conventional futures market. Yet, I also show that the 'Parker effect' reinforces and works with the official classification schema, not against them. Parker, I show, has become part of the institutional embedding of this market-arguably as key to the process of both price and status formation today as the 1855 classification itself.