Buying beauty: On prices and returns in the art market

摘要

It is seen that sometimes the arts which were sold at very higher prices earlier has been at lesser prices at a later stage. However due to increase in affluent individuals due to global business returns the market for is still on increase. There were many studies regarding the art market but most of them depend up on small data sets resulting in many estimation issues. This paper attempts a hedonic regression analysis that relates the price of the art to various characteristics and year effects.The results show that 1. Artist reputation, 2. Attribution, 3. Authenticity, 4. Medium, 5. Size, 6. Topic, and 7. The timing and location of the sale, are significantly correlated with price levels. Based on the regression coefficients on the year dummies in the model, a price index that controls for time variation can be built.