Ordering, revenue and anchoring in art auctions

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

Research output: Contribution to journalArticlepeer-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 languageEnglish
Pages (from-to)186-216
Number of pages31
JournalRAND Journal of Economics
Volume46
Issue number1
DOIs
StatePublished - 1 Mar 2015

Bibliographical note

Publisher Copyright:
© 2015, RAND.

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