Price and death: modeling the death effect in art price formation
Jun-ichi Itaya and
Heinrich Ursprung ()
Research in Economics, 2016, vol. 70, issue 3, 431-445
How does an artist׳s death impact on the price of her works of art? We investigate this question by analyzing a Stackelberg differential game played by an artist and a continuum of collectors. Employing the “piecewise open-loop strategy” concept, we find that the art price remains at some well-defined “pseudo-competitive” level as long as the artist is alive. When the artist unexpectedly dies, the price increases on impact. This so-called death effect varies negatively with the artist׳s age at death.
Keywords: Art prices; Durable-goods monopoly; Stackelberg equilibrium (search for similar items in EconPapers)
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Persistent link: https://EconPapers.repec.org/RePEc:eee:reecon:v:70:y:2016:i:3:p:431-445
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