I haven't read the wine study yet, so I don't know if neuroimaging of the placebo effect added anything to the literature, but your reporting on it falls into the trap of neurorealism.

You write:

brain scans confirmed that people don't just think the more expensive (but identical) wine tasted better—it actually really did taste better

As I've written elsewhere on neurorealism:

In an article called “fMRI in the Public Eye,” [Eric Racine] and two colleagues cited a Boston Globe article about how high-fat foods activate reward centers in the brain. The Globe headline: “Fat Really Does Bring Pleasure.” Couldn’t we have proved that with a slice of pie and a piece of paper with a check box on it?

Mr. Dixit asks, "Is it unethical for me to serve them the $20 bottle and tell them it’s the $100 bottle?"

I say, yes it is, even if they are happier for it, because ethics dictate that you don't substitute in a different product than what was purchased.

The ethical approach to achieving the same goal would be to tell them that you got a special deal with a vineyard that is allowing you to offer them a wine of $100 value to them for only $20. Then, the customers get the added effect of not only enjoying what they believe to be a $100 bottle of wine but also the effect of believing that they got a special price for it as well.

What we should really be addressing is how people go about putting a price or a value on something.

Jay, this research is interesting and is consistent with the priming effect.

But, anyone who pays $5k for a hooker and thinks that it is possible that the experience might be worth ten times the high hooker rate of $500, is paying for a lot more than for a good time - imagined or not, real or not.

Ya gotta wonder where the 5k came from that it was dispensed so easily.

I am a bargain shopper. I prefer to make high quality purchases at the lowest price possible. I also understand this is a trait of people that are accustomed to wealth....what does that say about Spitzer?

This effect is totally irrelevant to Spitzer's choice to spend that much money. He didn't spend that much because of the quality of the girl, but for the service to shut up about him getting it on. If he had a 500-dollar hooker, she'd be at McDonalds taddling in 5 minutes flat, or the service's security would be weak.

If there was any placebo effect, expecting to get off scott-free was his primer.

I recently saw a television segment that indirectly touched on this issue. I can't for the life of me remember what the program was, but it assessed the reasons certain books become best sellars. We would like to think that the majority simply recognizes a fine piece of literature and therefore pulls it out from a sea of books. The reality, however, is that few best sellars are literary masterpieces. We read what other people read. If Oprah says it is inspiring, people run out and buy it. We make countless judgements based on popular opinion and the chain-effect.

For something like judging wine, that requires a highly developed pallate, and perhaps an elite status to promote personal bias, we look to those who have large wine collections or spend a great deal of time wine tasting. It isn't about what the majority is drinking, but what the deemed experts are drinking. Does this actually mean wines selected by these people are better?

I personally am happy with a box of Franzia, but I do believe some people have developed highly distinguished taste. Studies show those who are professional taste testers, for example, use more portions of thier brains when tasting and pick up on minor differences in flavor. If we feel the need to employ taste-testers, than we need to stick to an honest system that values thier expertise. We have already decided to agree upon a true scale of rating. We trust that even if we can't tell the difference, the difference exists as defined by experts and it is our right to decide if we want to pay for a "superior product." I am a professional counselor, and I guarantee some of my clients would not know if I started using poor therapy techniques,however, this doesn't make it ethical for me to do so. We all can refine our distingusihing judgements with practice, but we need to be given the right tools to practice with.

"But, anyone who pays $5k for a hooker and thinks that it is possible that the experience might be worth ten times the high hooker rate of $500, is paying for a lot more than for a good time - imagined or not, real or not."

This assumes that there is a linear relationship between perceived values, and that is simply not so.

An automotive example provides a "less-sexually-charged" way to see this... An automobile that costs $15,000 almost certainly has the same number of wheels as an automobile costing $60,000; in the sense of "satisfying the need to get from point A to point B," both automobiles are precisely equivalent.

A $500 hooker almost certainly has the same number of overall body parts as one that charges $5000, and it is by no means obvious that their "physical charms" will necessarily differ by a material factor, even if at all. Neither are all that likely to be "crack whores" with racetracks of injection sites up their arms.

For someone who *can* afford the expensive car, or the expensive hooker, some of the perceived value will come in the bit of self-esteem that comes from the fact that they could afford the more expensive option.

Further, if someone can afford "expensive tastes," the consideration of that difference in price may not even be one of their considerations, even though it might be to you or I.