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A Few Notes on Art Auctions

Author

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  • Drabik Ewa

    (Warsaw University of Technology, Faculty of Management, Warsaw, POLAND)

Abstract

The art market, following the example of financial markets, is divided into a primary market, where works are traded directly from artists, and a secondary market that is mainly the auction market. Coronavirus disease 2019 (COVID-19) and galloping inflation have influenced the creation of a bull market in artwork. The high incomes of some buyers and inflation have influenced the emergence of the so-called ‘glittery’ art market. Works by neglected artists have ‘very much taken on a life of their own’: fantasy art, works by young poster artists, casting ‘nightmares’ – have been selling well for more than a year. People terrified of inflation are putting their money ‘in works of art’. The auction market dominates the primary market because anonymity makes it easier to enter the art market. The gallery market does not guarantee this anonymity. Very often, the auction market for works of art is used for money laundering. The purpose of this paper is to show that auction mechanisms are a good tool for the efficient allocation of goods and money in an area of galloping inflation and most art auctions are asymmetry.

Suggested Citation

  • Drabik Ewa, 2023. "A Few Notes on Art Auctions," Foundations of Management, Sciendo, vol. 15(1), pages 115-128, January.
    • Handle: RePEc:vrs:founma:v:15:y:2023:i:1:p:115-128:n:8
    DOI: 10.2478/fman-2023-0009
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    References listed on IDEAS

    as
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    5. Milgrom, Paul R & Weber, Robert J, 1982. "A Theory of Auctions and Competitive Bidding," Econometrica, Econometric Society, vol. 50(5), pages 1089-1122, September.
    Full references (including those not matched with items on IDEAS)

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    More about this item

    Keywords

    bidding; auction mechanism; art auction market; asymmetric auction;
    All these keywords.

    JEL classification:

    • C70 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - General
    • G19 - Financial Economics - - General Financial Markets - - - Other

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