Auction Prices and the Weather: New Evidence from Old Masters

31 Pages Posted: 28 Aug 2010

See all articles by Doron Kliger

Doron Kliger

University of Haifa

Yaron Raviv

Claremont McKenna College - Robert Day School of Economics and Finance

Joshua G. Rosett

Claremont McKenna College - Robert Day School of Economics and Finance

Thomas Bayer

Tulane University

John Page

Tulane University - Accounting & Taxation

Date Written: August 26, 2010

Abstract

Psychological evidence predicts that sunny weather is associated with an upbeat mood. Although standard economic theory presumes invariant preferences and full rationality, the finance literature has documented a strong relationship between morning sunshine in the city of a country's stock exchange and daily market index returns. In this paper we examine the effect of different weather conditions on art auction selling prices. Our sample includes art prices at auctions conducted from 1786 to 1909 in England. With respect to the main variables identified by the literature as being associated with agents' moods, we find that the length of daylight duration (from sunrise to sunset) on which the auction is conducted has a significant positive effect on the auction selling prices in all our model specifications. In addition, we find in some specifications direct positive effects of hours of sunshine during the day, precipitation, temperature, and whether the daylight duration increases relative to the previous day, on auction selling prices.

Keywords: Auctions, Weather, Mood, Behavioral Economics

JEL Classification: D44, D03

Suggested Citation

Kliger, Doron and Raviv, Yaron and Rosett, Joshua G. and Bayer, Thomas and Page, John, Auction Prices and the Weather: New Evidence from Old Masters (August 26, 2010). Available at SSRN: https://ssrn.com/abstract=1666550 or http://dx.doi.org/10.2139/ssrn.1666550

Doron Kliger

University of Haifa ( email )

Haifa 31905
Israel
(972)4-8249587 (Phone)
(972)4-8240059 (Fax)

Yaron Raviv (Contact Author)

Claremont McKenna College - Robert Day School of Economics and Finance ( email )

500 E. Ninth St.
Claremont, CA 91711-6420
United States
909-607-7305 (Phone)

Joshua G. Rosett

Claremont McKenna College - Robert Day School of Economics and Finance ( email )

500 E. Ninth St.
Claremont, CA 91711-6420
United States
909-607-3625 (Phone)
909-621-8249 (Fax)

HOME PAGE: http://www.claremontmckenna.edu/academic/faculty/profile.asp?Fac=372

Thomas Bayer

Tulane University ( email )

6823 St Charles Ave
New Orleans, LA 70118
United States

John Page

Tulane University - Accounting & Taxation ( email )

7 McAlister Drive
New Orleans, LA 70118
United States

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