The Dynamics of Art Prices: The Selection Corrected Repeat-Sales Index

Roberto Zanola

POLIS Working Papers from Institute of Public Policy and Public Choice - POLIS

Abstract: The repeat-sales model controls quality by utilizing the transacted prices of the same items in di.erent time periods. However, this methodology suffers from non-randomness of the data, implying that a sample based only on repeat-sales items may not represent the population of properties. To address this potential problem, the Heckman two-stage procedure has been applied to a sample of Picasso prints over the period 1988-1995 as registered in the 1995 edition of the Mayer International Auction Records on CD-ROM. Empirical evidence shows that the selection corrected repeat-sales model yields substantially better goodness of fit than the estimated standard repeat-sales specification.

Keywords: sample selection; Picasso; repeat sales; prints; price index (search for similar items in EconPapers)
JEL-codes: C5 Z1 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-cul
Date: 2007-01
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