Reputation, price, and death: an empirical analysis of art price formation

Arbeitspapier

We analyze how an artist's death influences the market prices of her works of art. Death has two opposing effects on art prices. By irrevocably restricting the artist's 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 artist's 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.

Object Details

• Language: Englisch

References and Relationships

• Bibliographic citation: Series: CESifo Working Paper ; No. 2237

Classification and Topics

• Classification: Wirtschaft ; Cultural Economics: Economics of the Arts and Literature ; Human Capital; Skills; Occupational Choice; Labor Productivity ; Asset Pricing; Trading Volume; Bond Interest Rates
• Subject: art price formation ; death effect ; durable goods monopoly ; Kunstgegenstand ; Preis ; Künstlerische Berufe ; Sterblichkeit ; Lebensalter ; Hedonischer Preis ; Theorie ; Welt

Contributors, Places and Time

• Event: Geistige Schöpfung
• (who): Ursprung, Heinrich W. ; Wiermann, Christian
• Event: Veröffentlichung
• (who): Center for Economic Studies and ifo Institute (CESifo)
• (where): Munich
• (when): 2008

Further information

• Handle: http://hdl.handle.net/10419/26282
• Last update: 10.03.2025, 11:41 AM CET