Paintings and Numbers: An Econometric Investigation of Sales Rates, Prices and Returns in Latin American Art Auctions

40 Pages Posted: 4 Jan 2020

See all articles by Nauro F. Campos

Nauro F. Campos

University College London; University of Michigan at Ann Arbor - The William Davidson Institute; IZA Institute of Labor Economics

Renata Leite Barbosa

affiliation not provided to SSRN

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Abstract

This paper uses a unique data set of Latin American paintings auctioned by Sotheby&apos's between 1995 and 2002 to investigate several puzzles from the recent auctions literature. Our results suggest that: (1) the reputation of an artist and the provenance of the artwork, omitted variables in most previous studies, seem to be more important determinants of the sale price of a painting than standard factors, such as medium and size, (2) the opinion of art experts seems to be of limited use in predicting whether or not an artwork sells at auction, (3) there is little supporting evidence for the widespread notion that the best or more expensive artworks tend to generate above average returns (the "masterpiece effect"), although (4) there is strong evidence in our data for the declining price anomaly, or "afternoon effect."

Keywords: art auctions, masterpiece effect, declining price anomaly, Latin American art

JEL Classification: D44, G11, L12, Z10

Suggested Citation

Campos, Nauro F. and Leite Barbosa, Renata, Paintings and Numbers: An Econometric Investigation of Sales Rates, Prices and Returns in Latin American Art Auctions. IZA Working Paper No. 3445, Available at SSRN: https://ssrn.com/abstract=1136250 or http://dx.doi.org/10.1111/j.0042-7092.2007.00700.x

Nauro F. Campos (Contact Author)

University College London ( email )

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United Kingdom

University of Michigan at Ann Arbor - The William Davidson Institute

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Ann Arbor, MI 48109-1234
United States

IZA Institute of Labor Economics

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Bonn, D-53072
Germany

Renata Leite Barbosa

affiliation not provided to SSRN

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