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Price and death: modeling the death effect in art price formation

Listed author(s):
  • Itaya, Jun-ichi
  • Ursprung, Heinrich W.

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.

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File URL: http://www.sciencedirect.com/science/article/pii/S1090944316301417
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Article provided by Elsevier in its journal Research in Economics.

Volume (Year): 70 (2016)
Issue (Month): 3 ()
Pages: 431-445

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Handle: RePEc:eee:reecon:v:70:y:2016:i:3:p:431-445
DOI: 10.1016/j.rie.2016.07.005
Contact details of provider: Web page: http://www.elsevier.com/locate/inca/622941

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