The Economics of Champagne, Revisited

For more on the social and economic significance of expensive Champagne, read Floyd Norris, who argues that overpriced bottles represent another form of wealth redistribution, filling the void left by the demise of the progressive income tax.

Digression, with Champagne

I don’t begin to understand how we decide to allow or deny ourselves the various gradations of pleasure or of luxury. Marketers remind us that only a select few deserve the very best but is it really a question of worth? Is there a tiny accountant in your head who suspects that your inimitable self is worth a bottle of Bollinger, but not the Blanc de Noir?



I doubt it. Consumers don’t engage in this sort of math; corporations do. According to Nick Passmore at Forbes.com, Champagne prices are “controlled not so much by the production cost as by what marketing executives believe the market can bear.” For some brands, higher prices are not a barrier to sales; they can actually boost sales.

In explaining the resurgence of Saks, the American department store, its chief executive notes, “Consumers want brands, and we are all about brands.”

So there you have it. The calculations described here do not involve worth, they invoke status. By buying the most expensive item in a particular category, you broadcast a range of signals to yourself and others. Your choice might indicate your membership in a particular group; it might imply a certain discrimination in taste. Depending on the context, it could display frivolity, individuality, availability—or all three.

Most of us are awake to these clues, even if we prefer not to name them explicitly. In polite conversation, a little bit of sociology goes a long way.

Sandy and Cliff are trying to do right by themselves. Like most of us, they would prefer to maintain their artistic integrity while reaping the rewards of financial success. I think that explains their aversion to the ordinary logic of branding, and their coyness about the brand’s derivation.

It’s hard to find fault with Sandy’s fundamental economic philosophy: “Buy our clothes—and then we’ll buy stuff too.”

Before You Go

I used to think that the best way to visit any city was to approach your stay like a relocation. That by trying to make yourself at home, you would open yourself to a wider range of experiences than the typical hotels-and-hotspots tour.

But a contrary strategy works just as well. If you want to rediscover the place you call home, treat it like a tourist destination.

After two years in Shanghai, our family of four is packing again, this time for Vermont. With the weeks counting down until our summer departure, we’ve begun asking ourselves what we haven’t seen or tasted yet. And what we want to do one more time, before the inevitable downturn in our personal boom-and-bust economy.

Here are two of the definitive responses, one at each end of the cultural and culinary spectrum. Strangely enough, you have to carry your own plates at both of them.

First, the splurge. Thanks to a convergence of business travelers and pleasure seekers, many of Shanghai’s five-star properties offer extravagant Sunday brunches. Three hours of more-or-less wholesome dissipation at the Westin Bund Center can include caviar, foie gras, lobster, and a river of Champagne (Piper Heidsieck, if you’re so inclined). There are serving stations on two floors surrounding a grandiose atrium, a genuinely diverting stage show, and, as you meander between the mushroom risotto and the roast duck, you’ll overhear conversations in German, Italian, and Finnish, among others. A pleasantly hallucinatory experience for about $70 per adult, half that for children; reservations essential.

You’ll leave satisfied, but not necessarily fulfilled, because fulfillment requires awareness. Brunch at the Westin is a transitory cocoon. Fine and silken, but also soporific.

On another Sunday, we’ll wake and breakfast at home. A debate will begin over the relative merits of Shanghai’s two principal varieties of soup dumplings. The English name is misleading. These delicacies are not served in soup; rather, they contain soup: a little burst of hot and fragrant broth, along with a mouthful of ground pork or minced crab, encased in a wheat-flour wrapper.

Maybe we’ll make the short drive to Nanxiang Town, original home of the steamed xiao long bao, where several blocks of dumpling restaurants flank the entrance to Guyi Garden, a classic Ming Dynasty maze of ponds, rocks, and bridges.

But more likely we’ll opt for the pan-fried shengjian mantou at Yang’s, on Wujiang Road. Until last week, this side street near the Nanjing Road West Metro Station hosted an untidy throng of pushcart vendors, hawking everything from barbecued oysters to bootlegged movies. These freelance capitalists have been displaced, however, in the name of public order, municipal cleanliness, and copyright protection.

Because Yang’s occupies two legal (and nearly identical) storefronts, our meal will be unaffected by the crackdown. And for that we’ll be thankful. The miraculous price—about 50 cents for a plate of four—doesn’t begin to explain their appeal. These dumplings are simultaneously crisp, succulent, tender, and savory.

The long lines might have something to do with our anticipation. All that sizzling and steaming, along with the white-aproned task force churning out fresh dumplings with astonishing precision. Then there’s the cheerful throng inside, on three levels linked by a narrow staircase, and the eager hunt for a few stools at one of the communal tables.

In a world of perfect fulfillment, our dumplings are just cool enough to taste by the time we find our seats. After that, it’s all a matter of technique. Our preferred method involves a judicious lift with the chopsticks, a prudent nip in the wrapper, then a pensive slurp—all before taking that first bite. You can spot the amateurs by the soup stains on their shirts.