Working Paper: CEPR ID: DP6583
Authors: Kathryn Graddy; Philip Margolis
Abstract: This paper measures the returns to investing in violins using two different datasets. One dataset includes 75 observations on repeat sales of the same violins at auction starting in the mid-19th century and another dataset includes over 2000 observations on individual violin sales at auction since 1980. Overall real returns for the dataset on repeat sales for the period 1850-2006 have been approximately 3.5%. Real returns to the overall portfolio of individual sales since 1980 have been nearly 4%. While this return is lower than other standard investments, the price path has been stable with a slight negative correlation to stocks and bonds.
Keywords: auctions; investment; repeat sales; violins
JEL Codes: D44; G11; L82
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| time period (C41) | returns on repeat sales of violins (Z11) |
| portfolio of individual sales since 1980 (G24) | returns (Y60) |
| maker (Stradivari and Guarneri del Gesù) (N63) | returns on investment (G11) |
| time and maker (N63) | price appreciation of modern Italian instruments (Z11) |
| violin prices (P22) | returns on stocks and bonds (G12) |