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Regulation or Reputation? Evidence from the Art Market

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  • Kim Oosterlinck
  • Anne-Sophie Radermecker

Abstract

We study the effect of public regulation of the art market. In 1981, France passed a Decree to regulate attribution practices, in a market where authenticity plays a key role in valuation and price formation mechanisms. By using empirical evidence from sales of early Flemish paintings (1955-2015), we show that the decree had a limited impact not only on due diligence and attribution practices but also on value of sales. The size and relative depth of the French art market compared to other countries, as well as the development of technical art history, the globalization of the art market, and compliance mechanisms explain the moderate impact of this Decree on old master sales. Our results therefore suggest that to regulate attribution in the arts, market mechanisms might be more effective than regulation.

Suggested Citation

  • Kim Oosterlinck & Anne-Sophie Radermecker, 2021. "Regulation or Reputation? Evidence from the Art Market," Working Papers CEB 21-006, ULB -- Universite Libre de Bruxelles.
    • Handle: RePEc:sol:wpaper:2013/322261
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    References listed on IDEAS

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    More about this item

    Keywords

    Art Market; Authenticity; Reputation; French Regulation; Marcus Decree;
    All these keywords.

    JEL classification:

    • K20 - Law and Economics - - Regulation and Business Law - - - General
    • Z11 - Other Special Topics - - Cultural Economics - - - Economics of the Arts and Literature

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