Where to sell your art?

This master thesis sheds light on what the most beneficial location is to sell artworks. In other words: are there substantial price differences between different locations around the world? To answer this question, Cindy Sherman’s photographs were used as the main research subjects in this master thesis. Additionally, the literature review deals with the art market and specifically the law of one price using literature mainly by Pesando regarding cultural economics. The law of one price is the notion that every identical commodity sold at the same time wherever in the world should fetch the same price. To determine whether the objects were identical or near-perfect substitutes, categories were created for the photographs of Cindy Sherman, resulting in 31 categories in total, of which 25 were operable. A dataset was constructed using 802 auction results for Cindy Sherman’s photographs for a period of ten years, from 2002 to 2012. This data was used to compare the different markets (USA, Europe, UK, Europe without UK and Sotheby’s New York, Christie’s New York and Phillips de Pury & Company New York), in order to identify possible discrepancies in prices. The main findings of this thesis are that the prices of Continental Europe are significantly lower than elsewhere, whereas one would expect that, due to transportation costs, prices in Europe would be higher. In addition, the results between the three big auction houses in New York were ambiguous. No real conclusion could be drawn, except that the distribution of the higher-priced categories may have had an influence. In addition, it can be concluded that Sotheby’s sells more of the smaller highly priced photographs, while Christie’s sells more of the larger highly priced photographs. Furthermore, a comparison was made between the course of hammer prices of Sherman’s photographs, the S&P500 stock exchange and the Dutch AEX index. Due to this comparison, it could be derived that the economic crisis may have affected the prices for Cindy Sherman’s photographs. Finally, there did not seem to be any influence of exhibitions on the prices for the photographs. Despite the wide-ranging results, there is still demand for more extensive research. It is therefore recommended that a longer running dataset with less unsold items and more items overall would benefit future research, since pairs of sales could not be created for this research and this could have been an important addition.