Financial Returns and Price Determinants in the 20th Century Design Market: Evidence from Sotheby's New York, 2007-2013 & 1966-2013.

摘要

In this study, 4,485 unique sale records sold over the period 1966-2013 at 20th century design auctions are used to construct short-term hedonic and long-term repeat sales price indices. By adopting four different estimation methodologies, I review the risk and return characteristics of various design categories in different time frames, and compare the design market with the traditional fine art market and other financial markets. I find that returns on the design market averaged 3.23% in the last six years with a standard deviation of 26.59%. Over the period 1966-2013, the mean return slightly improved at 4.64% with a standard deviation of 10.83%. This is relatively lower risk and return than those found in paintings, drawings and works on paper both domestically and internationally. Nonetheless, when compared with other financial assets, design seems to be a less attractive investment due to its high price volatility, mid-tier return and the positive correlation with most asset classes.