 Price and information disclosure in the private art market: A signalling gameFrancesco Angelini and Massimiliano Castellani Research in Economics, 2022, vol. 76, issue 1, 14-20 Abstract: In this paper, we model private art market agents’ strategic interactions in presence of two types of asymmetric information, about artwork quality and buyer’s knowledge, assuming the seller does not know how informed is the buyer while the buyer does not know the quality of the artwork before purchase. If the seller can choose either a high or a low price and the buyer can signal his type to the seller, we identify the conditions for both equilibria with pooling buyer signalling strategy and with separating strategy, as well as conditions for equilibria where the seller fixes the price according to the actual quality and where he posts prices trying to take advantage of buyer’s limited information. Finally, we identify the condition for the emergence of a “counter-lemon” result, where low-quality artworks and uninformed collectors exit the market, suggesting that seller uncertainty does not directly benefit the buyers, but it can impact the quality traded in the market. Keywords: Art pricing; Asymmetric information; Signalling; Disclosure; Quality (search for similar items in EconPapers) Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:eee:reecon:v:76:y:2022:i:1:p:14-20 DOI: 10.1016/j.rie.2022.01.002 Access Statistics for this article Research in Economics is currently edited by Federico Etro More articles in Research in Economics from Elsevier |
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