nep-cul New Economics Papers
on Cultural Economics
Issue of 2014‒11‒17
eight papers chosen by
Roberto Zanola
Università degli Studi del Piemonte Orientale “Amedeo Avogadro”

  1. Cultural Heritage and the Attractiveness of Cities: Evidence from Recreation Trips By Ruben van Loon; Tom Gosens; Jan Rouwendal
  2. Art as an Aternative Asset Class: Risk and Return Characteristics of the Middle Eastern & Northern African Art Markets By Roman Kräussl
  3. Proud to Be Pride: A Discourse Analysis of the Presentation of Diversity on City Websites By Gillberg, Nanna; Adolfsson, Petra
  4. Hofstede’s Cultural Indicators, Knowledge Economy and Entrepreneurship in Arab Countries By Driouchi, Ahmed; Gamar, Alae
  5. Is there a Bubble in the Art Market? By Roman Kräussl; Thorsten Lehnert; Nicolas Martelin
  6. Interdependent Happiness:Cultural Happiness under the East Asian Cultural Mandate By Hitokoto, Hidefumi
  7. Art in Africa: Market Structure and Pricing Behavior in the South African Fine Art Auction Market, 2009 - 2013 By Johannes W. Fedderke, Kaini Li
  8. The Impact of the Internet on Advertising Markets for News Media By Susan Athey; Emilio Calvano; Joshua S. Gans

  1. By: Ruben van Loon (VU University Amsterdam); Tom Gosens (VU University Amsterdam); Jan Rouwendal (VU University Amsterdam)
    Abstract: Many cities are trying to attract tourists by investing in urban amenities. Cultural heritage is an important example and substantial investments are needed to keep ancient inner cities and characteristic monumental buildings in good shape. The costs of these policies are usually clear, the benefits are often much more difficult to assess. This paper attempts to fill part of this gap by studying the destination choices of urban recreation trips that have urban recreation as the main travel motive. We estimate a discrete choice model for destination choice that takes into account the potential importance of unobserved characteristics. The model allows us to compute the marginal willingness to travel for destinations offering more cultural heritage, which we measure as the area of the inner city that has a protected status because of the cultural heritage that is present there.
    Keywords: Cultural heritage, recreation, city marketing
    JEL: C31 D12 R12 R22 L83
    Date: 2014–04–28
  2. By: Roman Kräussl (LSF)
    Abstract: This chapter analyzes the risk and return characteristics of investments in artists from the Middle East and Northern Africa (MENA) region over the sample period 2000 to 2012. With hedonic regression modeling we create an annual index that is based on 3,544 paintings created by 663 MENA artists. Our empirical results prove that investing in such a hypothetical index provides strong financial returns. While the results show an exponential growth in sales since 2006, the geometric annual return of the MENA art index is a stable13.9 percent over the whole period. We conclude that investing in MENA paintings would have been profitable but also note that we examined the performance of an emerging art market that has only seen an upward trend without any correction, yet.
    Keywords: Alternative investments, Art price index, Optimal Asset Allocation
    JEL: G11 Z11
    Date: 2014
  3. By: Gillberg, Nanna (Gothenburg Research Institute); Adolfsson, Petra (Företagsekonomiska Institutionen)
    Abstract: City-branding strategies today often stress ideas and stereotypes of culture and creativity. As urban managers increasingly focus on establishing cities as brands to position them at home and abroad (Saez et al 2013), a city’s official website becomes an important tool for brand construction and communication. In this paper we set out to study if and how diversity, here represented by gay friendliness, constitutes a component in creative branding of cities. The study is based on discourse analysis of material presented on official city websites of the five Northern European capitals. Our focus on gayness as an example of diversity shows that the topic is used in different ways in the communication of the city websites included in the study. While these cities might be seen as culturally similar, there are differences in how they present themselves regarding gayness. The results demonstrate a variation in the display of diversity both in terms of the character of the language used and in terms of the amount of information posted.
    Keywords: diversity; city branding; discourse analysis
    Date: 2014–09–03
  4. By: Driouchi, Ahmed; Gamar, Alae
    Abstract: Abstract: This paper looks at the links between cultural variables, knowledge indices and entrepreneurship in Arab countries. It uses the Hofstede’s cultural dimensions and World Bank data to show how these variables are connected. The outputs from Arab countries are also compared to those from the Eastern European economies. The outcomes do clearly indicate the existence of links between cultural dimensions, access to knowledge and enterprise creation with of a gap between Arab and Eastern European Economies. The results show also that entrepreneurship is linked to cultural variables in Arab countries. This implies that further economic and social policies are needed to ensure the promotion of the culture of the knowledge economy and entrepreneurship in Arab countries.
    Keywords: Keywords: Hofstede dimensions, Knowledge economy, Entrepreneurship, Arab countries, Eastern Europe
    JEL: L2 O1
    Date: 2014–09–20
  5. By: Roman Kräussl; Thorsten Lehnert; Nicolas Martelin (LSF)
    Abstract: The record-breaking prices observed in the art market for the last three years have rais the question of whether we are experiencing a speculative bubble. Given the difficulty to determine the fundamental value of artworks, we apply a right-tailed unit root test with forward recursive regressions (SADF test) to detect explosive behaviors directly in the time series of four different art market segments (“Impressionist and Modern”, “Post-war and Contemporary”, “American”, and “Latin American”) for the period from 1970 to 2013. We identify two historical speculative bubbles and find an explosive movement in today’s “Post-war and Contemporary” and “American” fine art market segments.
    Keywords: Art market; Alternative investments; Speculative bubbles; Explosive behavior
    JEL: G12 G14 Z11
    Date: 2014
  6. By: Hitokoto, Hidefumi
    Abstract: In order to examine how socio-economic status might undermine cultural happiness shared among East Asian cultural members, the concept of interdependent happiness - harmony with others, quiescence, and ordinariness - was measured using representative adults from Thailand living in both rural and urban areas. This study draws on the previous studies which show culturally shared understandings of the self as being relational and contextual among East Asians. I argue here that among Thai people, who live by traditional Buddhist practices and are experiencing rapid economic development, those with a high socio-economic status - who earn more money, are educated for a longer period of time, and hold administrative positions - would prove to have lowered interdependent happiness. The results of the study support this claim and while objective socio-economic status showed negative correlation with the interdependent happiness, it showed a negligible correlation with general happiness. These results provide the basis for the argument that within East Asian countries increased objective socio-economic status might undermine East Asian cultural well-being.
    Keywords: interdependent happiness , cultural well-being , socio-economic status , Thailand culture
    Date: 2014–07–02
  7. By: Johannes W. Fedderke, Kaini Li
    Abstract: In contrast to the international market in major centers such as New York and London, the South African market is distinguished by the presence of a clear market leader, and market follower amongst two auction houses that together virtually exhaust the domestic art market. A central concern of the present paper is how this market structure affects behavior in the market. We develop a theoretical framework to consider the interaction between market leader and follower in the context of a fine art market. Core implications are that the market follower is forced to issue excessive price estimates on art work that it attempts to attract for auction, at the cost of a higher buyin rate in auction. We test the implications of the theory against a data set of 7554 auction lots. A direct and an indirect test of the theory on our data robustly and strongly confirms the prediction of our model.
    Date: 2014
  8. By: Susan Athey (Stanford University); Emilio Calvano (CSEF, Università di Napoli Federico II); Joshua S. Gans (University of Toronto and NBER)
    Abstract: We provide a model of online advertising display markets where consumer attention may be divided among multiple publishers and, consequently, their advertising attention may be allocated to different platforms. We demonstrate that this gives rise to a mixture of single- and multi-homing advertisers and some consequent matching inefficiency between advertisers and consumers. Thus, as the number of switching consumers expands (associated with, say, the internet’s impact on news publishers), ad prices fall and a number of other competitive effects arise. We demonstrate that increased switching leads advertisers to favor reach over frequency and creates an incentive for contracting and technology improvements that can guarantee impressions to advertisers. Finally, we analyze the strategic choice of ad capacity, showing that, in general, increased switching leads to greater equilibrium ad capacity and lower prices.
    Keywords: advertising, media, newspapers, matching, multi-homing, singlehoming, tracking, two-sided markets, platforms
    JEL: L11 L82
    Date: 2014–10–28

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