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The Dynamics of Art Prices: The Selection Corrected Repeat-Sales Index

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  • Zanola, Roberto

Abstract

The repeat-sales model controls quality by utilizing the transacted prices of the same items in di.erent time periods. However, this methodology suffers from non-randomness of the data, implying that a sample based only on repeat-sales items may not represent the population of properties. To address this potential problem, the Heckman two-stage procedure has been applied to a sample of Picasso prints over the period 1988-1995 as registered in the 1995 edition of the Mayer International Auction Records on CD-ROM. Empirical evidence shows that the selection corrected repeat-sales model yields substantially better goodness of fit than the estimated standard repeat-sales specification.

Suggested Citation

  • Zanola, Roberto, 2007. "The Dynamics of Art Prices: The Selection Corrected Repeat-Sales Index," POLIS Working Papers 76, Institute of Public Policy and Public Choice - POLIS.
    • Handle: RePEc:uca:ucapdv:76
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    Cited by:

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    3. Fedderke, Johannes W. & Chen, Tinghua, 2023. "Generalizing the “Masterpiece Effect” in fine art pricing: Quantile Hedonic regression results for the South African fine art market, 2009–2021," Economic Modelling, Elsevier, vol. 124(C).
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    7. Stefania Ottone & Ferrucio Ponzano & Roberto Ricciuti, 2009. "Simulating Voting Rule Reforms for the Italian Parliament: An Economic Perspective," Czech Economic Review, Charles University Prague, Faculty of Social Sciences, Institute of Economic Studies, vol. 3(3), pages 292-304, October.
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    9. Nandini Srivastava & Stephen Satchell, 2012. "Are There Bubbles in the Art Market? The Detection of Bubbles when Fair Value is Unobservable," Birkbeck Working Papers in Economics and Finance 1209, Birkbeck, Department of Economics, Mathematics & Statistics.
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    12. Fabian Y.R.P. Bocart & Eric Ghysels & Christian M. Hafner, 2020. "Monthly Art Market Returns," JRFM, MDPI, vol. 13(5), pages 1-22, May.
    13. Marinelli, Nicoletta & Palomba, Giulio, 2011. "A model for pricing Italian Contemporary Art paintings at auction," The Quarterly Review of Economics and Finance, Elsevier, vol. 51(2), pages 212-224, May.
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    18. Breton, Albert & Scott, Anthony & Fraschini, Angela, 2007. "Explaining differences in environmental governance patterns between Canada, Italy and the United States," POLIS Working Papers 87, Institute of Public Policy and Public Choice - POLIS.
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    More about this item

    Keywords

    sample selection; Picasso; repeat sales; prints; price index;
    All these keywords.

    JEL classification:

    • C5 - Mathematical and Quantitative Methods - - Econometric Modeling
    • Z1 - Other Special Topics - - Cultural Economics

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