Between Heritage and Investment: Constructing the First Hedonic Price Index for the Czech Art Market

(disponible en anglais seulement)

[VERSION EN PRÉPUBLICATION]

Sylwester Bialowas, Marek Prokůpek

Sylwester Bialowas is an Associate Professor at the Poznan University of Economics and Business, where he heads the Depart­ment of Market Research and Services. His  works are bridging economics, statistics, and the arts. Member of the ACEI and TIAMSA.
Marek Prokůpek is an Associate Professor in Arts Management at KEDGE Business School, where he is a member of the KEDGE Arts School and the Creative Industries & Culture Research Centre. His research interests lie primarily in the areas of innovative business models of arts and cultural organizations, museum fundraising and philanthropy and its ethical challenges, and the art market.

ABSTRACT
This study constructs the first comprehensive price index for the Czech art market, covering the period 1998-2023, using a two-step hedonic regression approach on more than 215,000 auction records. By integrating cultural economics and financial economics perspectives, the paper situates Czech art as both a cultural good and an investment asset, highlighting the market’s dual role in preserving heritage and generating financial returns. The analysis identifies distinct phases in market development, including a sharp downturn in the early 2000s, resilience during the global financial crisis, consolidation in the 2010s, and high volatility in the pandemic period. Results reveal that while the Czech art market has delivered positive long-term appreciation, returns remain modest and subject to inefficiencies, high volatility, and liquidity risk. These findings enrich understanding of post-socialist art markets, demonstrate the methodological value of advanced hedonic models, and provide implications for arts management, investors, and cultural economics.

KEYWORDS
Czech art market; hedonic price index; cultural economics; financial economics; art investment; market inefficiency; value of art