Ordering, revenue and anchoring in art auctions

Harrison Hong, Ilan Kremer, Jeffrey David Kubik, Jianping Mei, Michael Moses

Research output: Contribution to journalArticle

3 Citations (Scopus)

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 languageEnglish (US)
Pages (from-to)186-216
Number of pages31
JournalRAND Journal of Economics
Volume46
Issue number1
DOIs
StatePublished - Mar 1 2015

Fingerprint

Art
Auctions
Anchoring
Revenue
Premium
Household
Anchoring effect

ASJC Scopus subject areas

  • Economics and Econometrics

Cite this

Ordering, revenue and anchoring in art auctions. / Hong, Harrison; Kremer, Ilan; Kubik, Jeffrey David; Mei, Jianping; Moses, Michael.

In: RAND Journal of Economics, Vol. 46, No. 1, 01.03.2015, p. 186-216.

Research output: Contribution to journalArticle

Hong, Harrison ; Kremer, Ilan ; Kubik, Jeffrey David ; Mei, Jianping ; Moses, Michael. / Ordering, revenue and anchoring in art auctions. In: RAND Journal of Economics. 2015 ; Vol. 46, No. 1. pp. 186-216.
@article{cc17ef590b96423da47b6690c51dfde5,
title = "Ordering, revenue and anchoring in art auctions",
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.",
author = "Harrison Hong and Ilan Kremer and Kubik, {Jeffrey David} and Jianping Mei and Michael Moses",
year = "2015",
month = "3",
day = "1",
doi = "10.1111/1756-2171.12081",
language = "English (US)",
volume = "46",
pages = "186--216",
journal = "RAND Journal of Economics",
issn = "0741-6261",
publisher = "Rand Journal of Economics",
number = "1",

}

TY - JOUR

T1 - Ordering, revenue and anchoring in art auctions

AU - Hong, Harrison

AU - Kremer, Ilan

AU - Kubik, Jeffrey David

AU - Mei, Jianping

AU - Moses, Michael

PY - 2015/3/1

Y1 - 2015/3/1

N2 - 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.

AB - 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.

UR - http://www.scopus.com/inward/record.url?scp=84922563877&partnerID=8YFLogxK

UR - http://www.scopus.com/inward/citedby.url?scp=84922563877&partnerID=8YFLogxK

U2 - 10.1111/1756-2171.12081

DO - 10.1111/1756-2171.12081

M3 - Article

VL - 46

SP - 186

EP - 216

JO - RAND Journal of Economics

JF - RAND Journal of Economics

SN - 0741-6261

IS - 1

ER -