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Reading between the lines in the art market: Lack of transparency and price heterogeneity as an indicator of multiple equilibria

dc.contributor.authorPrieto Rodríguez, Juan 
dc.contributor.authorVecco, Marilena
dc.identifier.citationEconomic Modelling, 102 (2021); doi:10.1016/j.econmod.2021.105587
dc.description.abstractThe hypothesis of a single deterministic price structure in the art market is unrealistic because of price dispersion, heterogeneity, limited information, and a lack of price transparency. Considerable price heterogeneity is asso- ciated with differences in quality; however, objective measurement of artistic quality is difficult, which reinforces the problem of lack of transparency in the art market. Applying finite mixture models to a sample of Surrealism paintings sold at auctions during 1990–2007, we test the hypothesis that the art market's lack of transparency is transferred to the art price system, which results in a fragmented market, characterized by the coexistence of different segments with various informational requirements, rules, and prices. Indeed, we find three distinct segments in the high end of the market, each with its own price structure. Furthermore, we identify a direct and an indirect effect on hammer prices exerted by the leading art auction
dc.description.sponsorshipThis work was funded by two grants of the Ministerio de Economía, Industria y Competitividad del Gobierno de España (#ECO2017-86402-C2-1-R and PID2019-104619RB-C42).spa
dc.relation.ispartofEconomic Modelling, 102spa
dc.rightsAttribution-NonCommercial-NoDerivatives 4.0 Internacional*
dc.rights© 2021 The Author(s). Published by Elsevier Ltd.
dc.titleReading between the lines in the art market: Lack of transparency and price heterogeneity as an indicator of multiple equilibriaspa
dc.local.notesOA ATUO21

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