Anchoring or Loss Aversion? Empirical Evidence from Art Auctions

Kathryn Graddy (), Rachel Pownall, Lara Loewenstein, Jianping Mei and Mike Moses

No 10048, CEPR Discussion Papers from C.E.P.R. Discussion Papers

Abstract: We find evidence for the behavioral biases of anchoring and loss aversion. We find that anchoring is more important for items that are resold quickly, and we find that the effect of loss aversion increases with the time that a painting is held. The evidence in favor of anchoring and loss aversion with this large dataset validates previous results and adds to the empirical evidence a finding of increasing loss aversion with the length a painting is held. We do not find evidence that investors can take advantage of these behavioral biases.

Keywords: Anchoring; Loss aversion; Endowment effect; Art auctions (search for similar items in EconPapers)
JEL-codes: D03 D44 Z11 (search for similar items in EconPapers)
Date: 2014-06
New Economics Papers: this item is included in nep-cul and nep-upt
References: Add references at CitEc
Citations: View citations in EconPapers (14)

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Working Paper: Anchoring or Loss Aversion? Empirical Evidence from Art Auctions (2014)
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