with Renata Leite Barbosa
Published in Oxford Economic Papers Vol 61 Issue 1 (January 2009),
pp. 28–51 ( pdf
)
This paper uses a unique data set of Latin American paintings auctioned
by Sotheby's between 1995 and 2002
to investigate several puzzles from the recent auctions literature. Our
results suggest that: (i) the reputation of an artist
and the provenance of the artwork, often omitted variables in previous
studies, seem to be more important determinants
of the sale price of a painting than more standard factors, such as medium
and size, (ii) the opinion of art experts seems
to be of limited use in predicting whether or not an artwork sells at auction,
(iii) there is little supporting evidence for the
widespread notion that the best or more expensive artworks tend to generate
above average returns (the “masterpiece
effect”), although (iv) there is strong evidence in our data for the declining
price anomaly or “afternoon effect” (that is, when
heterogeneous products sold sequentially follow a decreasing pattern of
prices.)
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Pictures at An Exhibition