Ordering, revenue and anchoring in art auctions

Harrison Hong; Ilan Kremer; Jeffrey D. Kubik; Jianping Mei; Michael Moses

doi:10.1111/1756-2171.12081

Ordering, revenue and anchoring in art auctions

Harrison Hong, Ilan Kremer, Jeffrey D. Kubik, Jianping Mei, Michael Moses

Department of Economics

Research output: Contribution to journal › Article › peer-review

9 Scopus citations

Abstract

We estimate the effect of ordering by value on revenues in sequential art auctions held by Sotheby's and Christie's. We exploit a pre determined rotation of which of these two houses holds their auction first during auction week in New York City. When the house that goes first has relatively expensive paintings compared to the other house, we find that the sale premium for the week is around 21% higher relative to the mean sale premium, and the fraction of paintings sold during the week is around 11% higher. We provide evidence that this is due to an anchoring effect.

Original language	English (US)
Pages (from-to)	186-216
Number of pages	31
Journal	RAND Journal of Economics
Volume	46
Issue number	1
DOIs	https://doi.org/10.1111/1756-2171.12081
State	Published - Mar 1 2015

ASJC Scopus subject areas

Economics and Econometrics

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10.1111/1756-2171.12081

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abstract = "We estimate the effect of ordering by value on revenues in sequential art auctions held by Sotheby's and Christie's. We exploit a pre determined rotation of which of these two houses holds their auction first during auction week in New York City. When the house that goes first has relatively expensive paintings compared to the other house, we find that the sale premium for the week is around 21% higher relative to the mean sale premium, and the fraction of paintings sold during the week is around 11% higher. We provide evidence that this is due to an anchoring effect.",

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Ordering, revenue and anchoring in art auctions

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