How Did Japanese Investments Influence International Art Prices?

Yale ICF Working Paper No. 03-09

EFA 2005 Moscow Meetings Paper

28 Pages Posted: 27 Jul 2005

See all articles by Takato Hiraki

Takato Hiraki

Tokyo University of Science - School of Management

Akitoshi Ito

Hitotsubashi University Business School

Darius Alexander Spieth

International University of Japan

Naoya Takezawa

International University of Japan

Abstract

This study examines dynamics among the art, Japanese land, Japanese and U.S. stock market prices during the sample period from 1976 to 1998. We find that the Japanese land prices caused both art and Japanese stock prices to co-move during the sample period. We interpret this finding as suggesting that the accelerated appreciation of land prices in Japan stimulated Japanese investor demands for both international arts and Japanese stocks, especially, in the late 1980s. We further show that the Japanese land index as well as own art index returns are dominant factors in generating fluctuations of returns in most art indexes. We also find that an influence of the Japanese land prices on art prices was preserved and even increased in the 1990s after the burst of bubbles. We interpret this as suggesting that in the 1990s the decreasing land prices in Japan urged some Japanese investors to sell their holdings of arts at a considerable bargain.

JEL Classification: G15, Z11

Suggested Citation

Hiraki, Takato and Ito, Akitoshi and Spieth, Darius Alexander and Takezawa, Naoya, How Did Japanese Investments Influence International Art Prices?. Yale ICF Working Paper No. 03-09; EFA 2005 Moscow Meetings Paper. Available at SSRN: https://ssrn.com/abstract=404800

Takato Hiraki (Contact Author)

Tokyo University of Science - School of Management ( email )

6-3-1 NiiJuku Katsushika-Ku
Tokyo, 125-8585
Japan
+81-480-21-7611 (Phone)
+81-480-21-7654 (Fax)

Akitoshi Ito

Hitotsubashi University Business School ( email )

2-1-2 Hitotsubashi
Chiyoda-ku, Tokyo, 101-8439
Japan

Darius Alexander Spieth

International University of Japan ( email )

Yamato-machi
Niigata-ken 949-7277
Japan

Naoya Takezawa

International University of Japan ( email )

Yamato-machi
Niigata-ken 949-7277
Japan

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