nep-cul New Economics Papers
on Cultural Economics
Issue of 2016‒10‒09
five papers chosen by
Roberto Zanola
Università degli Studi del Piemonte Orientale

  1. Art Auctions and Art Investment in the Golden Age of British Painting By Federico Etro; Elena Stepanova
  2. Time spent on New Songs: Word-of-Mouth and Price Effects on Teenager Consumption By Noémi Berlin; Anna Bernard; Guillaume Fürst
  3. The impact of advertising length caps on TV: Evidence from the French broadcast TV industry By Jiekai ZHANG
  4. Heritage & profits: La storia come vantaggio competitivo per l'impresa By Daniele Pozzi
  5. Culture, diffusion, and economic development By Ani Harutyunyan; Omer Ozak

  1. By: Federico Etro; Elena Stepanova
    Abstract: We analyze the evolution of the price of paintings in London auctions with a unique dataset of over 200,000 sales in the period 1780-1840. We build a price index for the representative painting through hedonic regressions controlling for the characteristics of auctions and paintings and for the artists' fixed effects. The emergence of an efficient secondary art market was an important opportunity for portfolio diversification. Estimating a CAPM model for art investment suggests that British paintings could deliver a higher return compared to imported paintings and an attractive source of diversification relative to the contemporary stock market. This contributed to increase demand for British art and, possibly, to promote the innovations of its Golden Age. While the representative painting of the British school was initially undervalued, new British painters reached foreign prices by the beginning of 1800s.
    Keywords: Art investment, Price of paintings, British Golden Age, Hedonic regressions, CAPM
    Date: 2016–04–10
  2. By: Noémi Berlin (University of Edinburgh - School of Economics - University of Edinburgh); Anna Bernard (CES - Centre d'économie de la Sorbonne - UP1 - Université Panthéon-Sorbonne - CNRS - Centre National de la Recherche Scientifique, PSE - Paris School of Economics); Guillaume Fürst (University of Geneva - Department of Psychology and Educational Sciences - University of Geneva [Switzerland])
    Abstract: The stardom system characterizes creative industries: the demand and revenues are concentrated on a few bestselling books, movies or music. In this paper, we study the demand structure between bestsellers and new artists' productions in the music industry. We set up an experiment where participants face real choices situations. We crate three treatments to isolate the effect of information and incentives on diversity. In a first treatment, music is consumed for free without information. In a second one, subjects receive a prior information on others' evaluation of songs to study the effect of word-of-mouth. Finally, in a third one, a real market is introduced and music is bought. Significant evidence shows that word-of-mouth lowers diversity, while price incentives tend to lift it. In both treatments, subjects also react to the information or incentives nature.
    Keywords: experimental economics,cultural goods,music industry,Stardom system
    Date: 2015–03
  3. By: Jiekai ZHANG (INSEE-CREST, 150 Boulevard Gabriel Péri, 92245 MALAKOFF, France)
    Abstract: The quantities of advertising on TV are regulated in France, as in many other developed countries. This paper aims at understanding the welfare implication of such regulation. It is the first paper which investigates this issue with a structural econometric model in two-sided market framework. I construct an unique database of per hour data on 12 main broadcast TV stations in France during one year (2014) to estimate structurally the demand and supply in the French broadcast television industry. I identify the shadow prices of regulation caps on advertising quantities, using the difference in estimated marginal costs between the binding and non-binding regulation constraints. A counterfactual experiment is carried out to quantify the exact impact of regulation. The results suggest that the TV channels advertise more without regulation but the overall impact of the current regulatory regime is small. The welfare analysis suggests that the current regulation framework is unnecessary, since it constrained the profit of TV channels without improving significantly the welfare of TV viewers.
    Keywords: Advertising, regulation, media, TV, two-sided market, structural estimation, shadow prices, welfare
    JEL: C35 D22 D62 H44 L13 L22 L51 L82 L88
    Date: 2016–09
  4. By: Daniele Pozzi
    Abstract: Historical heritage could represent a valuable distinguishing asset for the Italian companies. However, they do not always exploit this resource in full, while investing in culture is still often perceived as a sort of charity work, such as occasional acts of patronage. The article refers to the heritage factor as a strategic component which the firm could develop systematically, following a tripartite line of action. These three ideal courses of intervention will be presented through examples, suggesting future guidelines for development.
    Date: 2016–09
  5. By: Ani Harutyunyan; Omer Ozak
    Abstract: This research explores the effects of culture on technological diffusion and economic development. It shows that culture's direct effects on development and barrier effects to technological diffusion are, in general, observationally equivalent. In particular, using a large set of measures of cultural values, it establishes empirically that pairwise differences in contemporary development are associated with pairwise cultural differences relative to the technological frontier, only in cases where observational equivalence holds. Additionally, it establishes that differences in cultural traits that are correlated with genetic and linguistic distances are statistically and economically significantly correlated with differences in economic development. These results highlight the difficulty of disentangling the direct and barrier effects of culture, while lending credence to the idea that common ancestry generates persistence and plays a central role in economic development.
    Keywords: Comparative economic development, Economic growth, Culture, Barriers to technological diffusion, Genetic distances, Linguistic distances
    Date: 2016

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