IDEAS home Printed from https://ideas.repec.org/a/bla/jindec/v70y2022i1p147-167.html
   My bibliography  Save this article

Demand for Rarity: Evidence from a Collectible Good

Author

Listed:
  • Jonathan E. Hughes

Abstract

Markets for art, coins and other collectibles, culinary delicacies and eco‐tourism suggest that consumers value the rarity of many goods. While empirical evidence supports higher prices for rare goods, isolating the value of rarity has proven difficult. I analyze prices for a collectible card game and show goods that are designated as rare trade at higher prices than functionally equivalent substitutes. Importantly, I use novel features of this market to account for scarcity, observed and unobserved product characteristics and separately identify rarity effects. These results have important implications for markets ranging from luxury goods to conservation of endangered species.

Suggested Citation

  • Jonathan E. Hughes, 2022. "Demand for Rarity: Evidence from a Collectible Good," Journal of Industrial Economics, Wiley Blackwell, vol. 70(1), pages 147-167, March.
    • Handle: RePEc:bla:jindec:v:70:y:2022:i:1:p:147-167
    DOI: 10.1111/joie.12262
    as

    Download full text from publisher

    File URL: https://doi.org/10.1111/joie.12262
    Download Restriction: no
    File URL: https://libkey.io/10.1111/joie.12262?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    References listed on IDEAS

    as
    1. Hilger, James & Rafert, Greg & Villas-Boas, Sofia Berto, 2007. "Expert Opinion and the Demand for Experience Goods: An Experimental Approach," CUDARE Working Papers 6055, University of California, Berkeley, Department of Agricultural and Resource Economics.
    2. Jean-Noël Kapferer, 2012. "Abundant rarity: The key to luxury growth," Post-Print hal-00731044, HAL.
    3. Cong, Li & Wu, Bihu & Morrison, Alastair M. & Shu, Hua & Wang, Mu, 2014. "Analysis of wildlife tourism experiences with endangered species: An exploratory study of encounters with giant pandas in Chengdu, China," Tourism Management, Elsevier, vol. 40(C), pages 300-310.
    4. David H. Reiley, 2006. "Field experiments on the effects of reserve prices in auctions: more Magic on the Internet," RAND Journal of Economics, RAND Corporation, vol. 37(1), pages 195-211, March.
    5. Rosen, Sherwin, 1974. "Hedonic Prices and Implicit Markets: Product Differentiation in Pure Competition," Journal of Political Economy, University of Chicago Press, vol. 82(1), pages 34-55, Jan.-Feb..
    6. Slone, Thomas H. & Orsak, Larry J. & Malver, Olaf, 1997. "A comparison of price, rarity and cost of butterfly specimens: Implications for the insect trade and for habitat conservation," Ecological Economics, Elsevier, vol. 21(1), pages 77-85, April.
    7. Kapferer, Jean-Noël, 2012. "Abundant rarity: The key to luxury growth," Business Horizons, Elsevier, vol. 55(5), pages 453-462.
    8. James Hilger & Greg Rafert & Sofia Villas-Boas, 2011. "Expert Opinion and the Demand for Experience Goods: An Experimental Approach in the Retail Wine Market," The Review of Economics and Statistics, MIT Press, vol. 93(4), pages 1289-1296, November.
    9. Hunt Allcott & Nathan Wozny, 2014. "Gasoline Prices, Fuel Economy, and the Energy Paradox," The Review of Economics and Statistics, MIT Press, vol. 96(5), pages 779-795, December.
    10. H. Leibenstein, 1950. "Bandwagon, Snob, and Veblen Effects in the Theory of Consumers' Demand," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 64(2), pages 183-207.
    11. Bagwell, Laurie Simon & Bernheim, B Douglas, 1996. "Veblen Effects in a Theory of Conspicuous Consumption," American Economic Review, American Economic Association, vol. 86(3), pages 349-373, June.
    12. David Lucking-Reiley, 1999. "Using Field Experiments to Test Equivalence between Auction Formats: Magic on the Internet," American Economic Review, American Economic Association, vol. 89(5), pages 1063-1080, December.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Michel Gutsatz & Klaus Heine, 2018. "Is luxury expensive?," Journal of Brand Management, Palgrave Macmillan, vol. 25(5), pages 411-423, September.
    2. Rosenbaum, Mark S. & Ramirez, Germán Contreras & Campbell, Jeffrey & Klaus, Philipp, 2021. "The product is me: Hyper-personalized consumer goods as unconventional luxury," Journal of Business Research, Elsevier, vol. 129(C), pages 446-454.
    3. Christopher R. Gustafson & Travis J. Lybbert & Daniel A. Sumner, 2016. "Consumer sorting and hedonic valuation of wine attributes: exploiting data from a field experiment," Agricultural Economics, International Association of Agricultural Economists, vol. 47(1), pages 91-103, January.
    4. Boisvert, Jean & Christodoulides, George & Sajid Khan, M., 2023. "Toward a better understanding of key determinants and consequences of masstige consumption," Journal of Business Research, Elsevier, vol. 161(C).
    5. Chen, Kuan-Ju & McCluskey, Jill J., 2018. "Impacts of Expert Information on Prices for an Experience Good across Product Segments: Tasting Notes andWine Prices," Journal of Agricultural and Resource Economics, Western Agricultural Economics Association, vol. 43(3), September.
    6. Sofia B. Villas‐Boas & Céline Bonnet & James Hilger, 2021. "Random Utility Models, Wine and Experts," American Journal of Agricultural Economics, John Wiley & Sons, vol. 103(2), pages 663-681, March.
    7. Gustafson Christopher R., 2015. "The Role of Knowledge in Choice, Valuation, and Outcomes for Multi-Attribute Goods," Journal of Agricultural & Food Industrial Organization, De Gruyter, vol. 13(1), pages 33-43, January.
    8. Husain, Rehan & Paul, Justin & Koles, Bernadett, 2022. "The role of brand experience, brand resonance and brand trust in luxury consumption," Journal of Retailing and Consumer Services, Elsevier, vol. 66(C).
    9. Wei, Ying & Li, Feng, 2020. "Omnichannel supply chain operations for luxury products with conspicuous consumers," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 137(C).
    10. Dieter Pennerstorfer & Christoph Weiss & Andreas Huber, 2019. "Experts, Reputation and Umbrella Effects: Empirical Evidence from Wine Prices," Economics working papers 2019-08, Department of Economics, Johannes Kepler University Linz, Austria.
    11. Nelson Borges Amaral, 2020. "What can be done to address luxury counterfeiting? An integrative review of tactics and strategies," Journal of Brand Management, Palgrave Macmillan, vol. 27(6), pages 691-709, November.
    12. Villas-Boas, Sofia B, 2020. "Reduced Form Evidence on Belief Updating Under Asymmetric Information," Department of Agricultural & Resource Economics, UC Berkeley, Working Paper Series qt08c456vk, Department of Agricultural & Resource Economics, UC Berkeley.
    13. Park, Judy, 2014. "What women want: Creation of a luxury brand," Business Horizons, Elsevier, vol. 57(2), pages 247-257.
    14. Jennifer Brown & John Morgan, 2009. "How Much Is a Dollar Worth? Tipping versus Equilibrium Coexistence on Competing Online Auction Sites," Journal of Political Economy, University of Chicago Press, vol. 117(4), pages 668-700, August.
    15. Javier F. de la Ballina & Isabel de la Ballina, 2019. "Scarcity as a Desirable Attribute of Luxury Fashion Brands in Millennial Marketing," Tržište/Market, Faculty of Economics and Business, University of Zagreb, vol. 31(2), pages 153-170.
    16. Bernheim, B Douglas, 1994. "A Theory of Conformity," Journal of Political Economy, University of Chicago Press, vol. 102(5), pages 841-877, October.
    17. Sandra Krim, 2022. "Conceptualizing the media of artification: a contribution to the theory of artification of luxury brands," Post-Print hal-03675162, HAL.
    18. Katkar Rama & Reiley David H, 2007. "Public versus Secret Reserve Prices in eBay Auctions: Results from a Pokémon Field Experiment," The B.E. Journal of Economic Analysis & Policy, De Gruyter, vol. 5(2), pages 1-25, January.
    19. Villas-Boas, Sofia B & Taylor, Rebecca & Krovetz, Hannah, 2016. "Willingness to Pay for Low Water Footprint Food Choices During Drought," Department of Agricultural & Resource Economics, UC Berkeley, Working Paper Series qt9vh3x180, Department of Agricultural & Resource Economics, UC Berkeley.
    20. B. Faye & E. Le Fur & S. Prat, 2015. "Dynamics of fine wine and asset prices: evidence from short- and long-run co-movements," Applied Economics, Taylor & Francis Journals, vol. 47(29), pages 3059-3077, June.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:bla:jindec:v:70:y:2022:i:1:p:147-167. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Wiley Content Delivery (email available below). General contact details of provider: http://www.blackwellpublishing.com/journal.asp?ref=0022-1821 .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.