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Anchoring or Loss Aversion? Empirical Evidence from Art Auctions

Kathryn Graddy (), Lara Loewenstein, Jianping Mei, Mike Moses and Rachel Pownall ()
Additional contact information
Mike Moses: Beautiful Asset Advisors LLC

No AWP-04-2014, ACEI Working Paper Series from Association for Cultural Economics International

Abstract: We find evidence for the behavioral biases of anchoring and loss aversion. We find that anchoring is more important for items that are resold quickly, and we find that the effect of loss aversion increases with the time that a painting is held. The evidence in favor of anchoring and loss aversion with this large dataset validates previous results and adds to the empirical evidence a finding of increasing loss aversion with the length a painting is held. We do not find evidence that investors can take advantage of these behavioral biases.

Keywords: D03; D44; Z11 (search for similar items in EconPapers)
Pages: 37 pages
Date: 2014-06, Revised 2014-06
New Economics Papers: this item is included in nep-cbe, nep-cul and nep-upt
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Persistent link: https://EconPapers.repec.org/RePEc:cue:wpaper:awp-04-2014

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