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ifo Institut – Leibniz-Institut für Wirtschaftsforschung an der Universität München >
CESifo Working Papers, CESifo Group Munich >
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http://hdl.handle.net/10419/26282
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| Title: | | Reputation, price, and death: an empirical analysis of art price formation  |
| Authors: | | Ursprung, Heinrich W. Wiermann, Christian |
| Issue Date: | | 2008 |
| Series/Report no.: | | CESifo working paper 2237 |
| Abstract: | | We analyze how an artists death influences the market prices of her works of art. Death has two opposing effects on art prices. By irrevocably restricting the artists oeuvre, prices, ceteris paribus, increase when the artist dies. On the other hand, an untimely death may well frustrate the collectors hopes of owning artwork that will, as the artists career progresses, become generally known and appreciated. By frustrating expected future name recognition, death impacts negatively on art prices. In conjunction, these two channels of influence give rise to a hump-shaped relationship between age at death and death-induced price changes. Using transactions from fine art auctions, we show that the empirically identified death effects indeed conform to our theoretical predictions. We derive our results from hedonic art price regressions, making use of a data set which exceeds the sample size of traditional studies in cultural economics by an order of magnitude. |
| Subjects: | | art price formation death effect durable goods monopoly |
| JEL: | | Z11 J24 G12 |
| Document Type: | | Working Paper |
| Appears in Collections: | | CESifo Working Papers, CESifo Group Munich
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