Art Market in Poland. Evaluation of the individual hedonic art price indexes for the selected Polish painters

Dorota Witkowska 

University of Lodz, Faculty of Management (UL), Matejki 22/26, Lodz 90-237, Poland

    When the situation at financial markets is turbulent, investors are looking for the alternative investments to diversify their portfolios, and art has been recently recognized as such the investment opportunity. Therefore there has been growing literature on the relation of art and investment: (Frey and Pommerehne, 1988; 1989a, 1989b), (Pesando, 1993), (Chanel et al, 1994), (Mei and Moses, 2002), (Worthington and Higgs, 2003, 2004), (Campbell, 2004, 2008), (Taylor, 2008), (Hsieh et al, 2010), (Higgs, 2012) and (Frey and Cueni, 2013). However the majority of the publications on the art investments refer to the well-developed art markets and topics concerning the situation of the art markets and the possibility of art investments in transitional states rarely appear in literature. Therefore this paper is an attempt to fill that gap in literature.
    To consider art as an asset the systematic measure of its financial performance is needed. The art price indexes are used for such purpose, applying the hedonic regression to produce the quality adjusted performance measure. The explanatory variables in these models represent the basic characteristics of the artworks. These features usually describe the name of the artist and the auctioneer, the artist’s living status, the size of the art object, the technique and the medium of the artwork, the year when it was sold, etc.
    The aim of our investigation is to describe the Polish art market and to construct the individual hedonic art price indexes for the, well recognized in Poland, Polish painters. We select five painters: Malczewski, Kossak, Nowosielski, Nikifor and Dwurnik), who seem to be representative for the analyzed art market and whose artworks were sold the most often at auctions in the years 2007-2010.
    The results of empirical investigation show that the financial crisis hit not only the equity but also the art market in Poland. It is also visible that hedonic index is sensitive on the regression model specification thus the aggregated index is proposed.

Research have been conducted under the National Science Centre Grant No. 2012/05/B/HS4/04188 Investing in Paintings on the Financial Market


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Presentation: Oral at Current Economic and Social Topics 2015, by Dorota Witkowska
See On-line Journal of Current Economic and Social Topics 2015

Submitted: 2016-02-21 14:49
Revised:   2016-02-21 18:23