This paper examines the relationship between sale rates and price shocks in art auctions. Using data on contemporary and impressionist art, we show that while sale rates appear to have little relationship to current prices, there exists a strong negative relationship of sale rates to unexpected price shocks, which is reminiscent of a Phillips curve. We estimate an empirical model that suggests that the reserve price is set on average at about 70% of the low estimate.
|Original language||English (US)|
|Number of pages||5|
|Journal||American Economic Review|
|State||Published - May 2011|
All Science Journal Classification (ASJC) codes
- Economics and Econometrics