Victor Ginsburgh

Expert Opinion and Compensation: Evidence from a Musical Competition

Pianists who achieve high scores in the Queen Elizabeth musical competition are rewarded by subsequent success. This is not surprising in itself, but it is not immediately clear whether this is caused by the score or because those who have high scores are better pianists. Data on eleven consecutive competitions make it possible to distinguish between the two explanations, since an unexpected situation allows us to use an instrumental variable (the randomly assigned order in which musicians appear at the competition), uncorrelated with ability, but correlated with the results of the competition.

Revisiting Baumol's Art as floating crap game

We show that Baumols conclusion that returns on bonds are higher than returns on paintings is too pessimistic. There are segments in the market for which returns are significantly higher than returns on bonds and stocks, during long periods of time (20 to 40 years); since tastes do change slowly (though not in a predictable way), this may imply that beating the market is not impossible. We also construct price indexes for paintings over the last 200 years.

Absentee Bidders and the Declining Price Anomaly in Wine Auctions

The anomaly is concerned with the observation that in multiple item auctions of identical objects, prices tend to decline over time. I show that in the case of wine auctions, which have been analyzed frequently, the anomaly is likely to be caused by the fact that most bids are entered by absentees, who use nonoptimal bidding strategies. Therefore, wine auctions can hardly be used to illustrate the standard multiple‐object auction model.

Long-term Comovements in International Markets for Paintings

We study steady-state relationships between prices for paintings obtained by three groups of painters (Impressionist, Modern and Contemporary European Masters, Other minor European painters, Contemporary US painters) at public auctions in New York, London and Paris between 1962 and 1991. The analysis is carried out by estimating Vector autoregressive models, using the recent techniques developed by Johansen. The results show that the various markets move closely together, and are, even in New York, led by what happens to the group of European Great Masters, whose prices are not influenced by other prices. We also examine the relation between art and stock markets; we find that there is no long-run relation between these two assets, though in the short-run, financial markets do influence art markets.

Returns of impressionist, modern and contemporary European painters, 1962-1991

We construct returns and quantity indices for Impressionist, Modern and Contemporary painting over the last thirty years, using the results of public auctions. In particular, we isolate the large swing in prices during the late 1980s; from results on individual artists, we also conclude that the randomness in the behaviour of prices is very limited, once the behaviour of the aggregate market in known.

Disenfranchisement in Linguistically Diverse Societies: The Case of the European Union

We consider a linguistically diversified society that has to select a set of languages to be used for official purposes. We examine the notion of language disenfranchisement that is created when one or more languages fail to be included in the list of the official ones, implying that some individuals are denied full access to the documents and to the political process in their native tongues. To derive one of our disenfranchisement indices, we use the Dyen percentage cognate matrix of linguistic distances between languages. We then apply survey and population data on language proficiency in the European Union, calculate disenfranchisement indices and determine optimal sets of official languages that depend on two parameters, societys sensitivity against disenfranchisement and comprehensiveness of the language regime adopted. We also discuss the language situation in the European Union after its enlargement in May 2004.

On the perceived quality of movies

We address the question of the quality of movies produced between 1950 and 1970. A first outcome of our analysis is that the quality assessments made during the Cannes Festival, and to a lesser degree, by the U.S. Academy are short-lasting. In contrast to this, consumers seem consistent over time. There is, however, one issue on which experts agree as well as consumers: American movies dominate both in terms of commercial success and in terms of quality. There is less agreement, and sometimes there is even dissent concerning other dimensions. This does not come as a surprise and merely indicates that there is hardly a common yardstick along which the quality of a movie can be measured. Therefore, decomposing a work of art into quantifiable characteristics – even in a subjective but possibly unanimous way – would make it possible to explain the divergences between audiences and changes of appreciation over time.

On Existence and Stability of Spatial Equilibria and Steady-states

Abstract This note discusses the existence and stability of two equilibrium concepts for a spatial economy in which the utility of an agent depends on the overall distribution of agents over space.

Natural endowments, production technologies and the quality of wines in bordeaux. Does terroir matter?

We study whether quality assessments made by wine experts and by consumers (based on prices obtained at auction between 1980 and 1992) can be explained by variables describing endowments (land characteristics, exposures of vineyards) and technologies (from grape varieties and picking, to bottled wines). However, since technological choices are likely to depend on endowments, the effects can only be identified using an instrumental variables approach. We show that technological choices affect quality much more than natural endowments, the effect of which is negligible.

Art Experts and Auctions: Are Pre-Sale Estimates Unbiased and Fully Informative?

Public sales art catalogues include low and high pre-sale price estimates by experts. This makes it possible to analyze whether pre-sale estimates are unbiased predictors of realized prices. Unbiasedness is tested using a sample of some 1,600 lots of English silver auctioned by Christies and Sothebys. Results show that estimates are slightly (but significantly) biased and that experts do not use all the information that is available to them when they make their estimates.