4. Empirical Results and Discussion
4.2 Hedonic regression
4.2.2 Dynamics change of Price determinants of hedonic characteristics in the long-run movements
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Therefore, the material of fans may negatively affect prices (Liu, 2009). This is the first research to have found the correlation between the mounting and art price, further research needs to confirm these results.
The prior evidence on size suggests that the prices increase with size but decrease as the size increases. Therefore, the current hedonic regression includes the size and size square to measure the extent of the piece of artwork. Table 4 shows that the coefficient with the size is positive, while the coefficient with the size square is negative.
The final set of variables is about the sales’ characteristics, including the sales venue and auction date. The result shows that the artwork sold at Sotheby’s and Christie’s substantially yields the higher prices, compared to artwork sold at the other auction houses. This result is consistent with the previous literature (Agnello & Pierce, 1996; Fedderke & Li, 2019; Renneboog &
Spaenjers, 2013), Sotheby’s and Christie’s have a high reputation and market power, and they can attain high-quality artwork and can exhibit the exhibition at the prestigious museum. Considering the auction month, the artwork tends to increase the prices in May, June, November, and December.
Sotheby’s and Christie’s, always holding the important auctions and selling the most precious artworks around these months, with other auction houses following their practice (Agnello, 2002;
Renneboog & Spaenjers, 2013a; Worthington & Higgs, 2004).
[Insert Table 4 here]
4.2.2 Dynamics change of Price determinants of hedonic characteristics in the long-run
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2016). The artists’ and works’ characteristics are significantly influenced by the changes in the techniques and traditions of the works. Therefore, the variation in movement might provide the different price determinants of hedonic attributes in artist’s and work’s characteristics.
Panel A of Table 5 constructs the intersection between ancient period and hedonic attributes, and reports a comparison and contrasting results of Chinese art between ancient and modern. Panel A did not report results for Deceased and Oils. The ancient period ended many years ago and thus, all artists have passed away. The artwork executed in Oils had not appeared in the ancient period.
The result shows that the coefficient for Mentorship on ancient is negative and insignificant, compared modern. The study suspects that lack of clarity in a number of information regarding whether the artists have learned from the famous teacher or not might explain the insignificance of this coefficient.
Regard with work’s characteristics, the current research investigates the dynamics changes of hedonic attributes across authenticity and mounting category. In authenticity category, the coefficients of Signed, Celebrity and Provenance on ancient is insignificant relative to modern.
Similar to the case of the above, the lack of clarity in the number of auction catalogs regarding whether an artwork was signed, celebrity, and provenance or not might explain the insignificance of these coefficients. By contrast, the coefficient of Literature on ancient commands the high premiums, followed by Exhibition. The exhibition and literature, as public trusted institutions, provide a reliable reference for the authenticity on ancient artwork, which significantly contributes to the price of ancient works.
The current research further investigates the dynamics changes of mounting category in the long-term movement. The result shows that the artwork mounted in Drawing axis on ancient are among the most expensive, followed by Fans. The high premium with Drawing axis is related to
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the art form. Drawing axis is a very old mounting style with a high historical value. Most of the artworks are hung on the wall for display, but the Drawing axis is lightweight and mobile. For artists, it is convenience to display artwork on special occasions. In terms of Fans, although the material of fan paintings is easy to damage due to the poor absorbency and creasing, the well- preserved ancient fan painting has a high economic value.
Panel B of Table 5 constructs the intersection between modern and hedonic attributes, and reports a comparison and contrast the results of Chinese art between modern and contemporary.
From the artist’s characteristics, Deceased and Mentorship on modern artwork is statistically significant positive premium relative to contemporary artwork. It is argued the reason for Deceased is that the modern period ended many years, and some the artists have passed away. The artist who was deceased cannot create the artwork. As a result, the restrictions on the supply of artwork have led to higher prices on modern artwork (Spaenjers, Goetzmann, & Mamonova, 2015).
As for Mentorship, during the early 20th century (1900-1936), only the outstanding students can be selected by the Chinese government to study abroad (Ying, 2013), most of the artists who returned to China have become the well-known artists. The young artists have learned the artistic technique by following those famous artists. Therefore, Mentorship on modern yields high value.
From work’s characteristics. Exhibition on modern reports highest price premia. The artwork allowed them to exhibit due to its high quality and high value. Additionally, the exhibition as public trusted institutions provides reliable evidence on the authenticity of the artwork. As unexpected, the coefficient of Dated on modern is negative. The negative association is driven by the higher variance of dated artworks’ prices, in particular, the fact that both the highest and lowest priced artworks are dated. In the mounting category, Vertical drawing yields substantially the highest prices, followed by Albums. The artwork mounted in Vertical drawing is one of the most
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common mounting types in traditional Chinese painting and is the most popular mounting style for modern artists. The high price of modern painting mounted in Album is attributed to its artistic value and art forms. The painting mounted in Album usually consisted of multiple leaves (pages) of approximately the same size. Each leaf is a painting that can stand on its own but is usually related to the other leaves. The artist needs to create the different paintings in each page and therefore, it has high artistic value. In addition, the album paintings did not hang on the wall, which is convenient for artists to storage and display.
[Insert Table 5 here]