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Also a common culinary term. To reduce—in the infinitive—is to cook any alcohol product until all alcohol itself has been boiled off, leaving just a flavored liquid behind. This is done in order to use said liquid in a dish without one of two things happening:
  1. The guests get snookered.
  2. Your entree catches on fire.
Seriously, regardless of those two hazards, reduction of alcoholic products is normally done to enhance the flavor of the entree you're preparing, as alcohol itself is harsh and can distract from the more delicate flavors in a good white wine sauce.

To reduce wine or liquor, it should be simmered over low heat in a skillet until it ceases to 'bubble'.