Testing for Bubbles in the Chinese Art Market
This article detects the existence of bubbles in the Chinese art market and investigates when the bubbles originate and crash. We utilize the generalized supremum augmented Dickey–Fuller (ADF) test to detect explosive behavior in the Chinese art market. The empirical results indicate that there are...
| Main Authors: | , , , |
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| Format: | Article |
| Language: | English |
| Published: |
SAGE Publishing
2020-01-01
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| Series: | SAGE Open |
| Online Access: | https://doi.org/10.1177/2158244019901249 |
| _version_ | 1828838639299198976 |
|---|---|
| author | Xin Li Chi-Wei Su Meng Qin Fahai Zhao |
| author_facet | Xin Li Chi-Wei Su Meng Qin Fahai Zhao |
| author_sort | Xin Li |
| collection | DOAJ |
| description | This article detects the existence of bubbles in the Chinese art market and investigates when the bubbles originate and crash. We utilize the generalized supremum augmented Dickey–Fuller (ADF) test to detect explosive behavior in the Chinese art market. The empirical results indicate that there are two bubbles in the Chinese art market that happened in the periods from 2004 to 2005 and 2010 to 2011. The main reasons are the financialization of artworks, the speculation of investment institution, and the fluctuation of macroeconomics in China. Our findings are in agreement with the bubble model improved by Gürkaynak considering that asset price can be decomposed to bubbles and fundamental parts. Therefore, to favor the Chinese art market price stabilization, the regulators from this market should identify bubbles to notice their evolutions. The authorities should also manage the expectations of the public and reduce speculative behavior. |
| first_indexed | 2024-12-12T19:06:31Z |
| format | Article |
| id | doaj.art-9f37decaa5044ba788bdab7290361e1c |
| institution | Directory Open Access Journal |
| issn | 2158-2440 |
| language | English |
| last_indexed | 2024-12-12T19:06:31Z |
| publishDate | 2020-01-01 |
| publisher | SAGE Publishing |
| record_format | Article |
| series | SAGE Open |
| spelling | doaj.art-9f37decaa5044ba788bdab7290361e1c2022-12-22T00:14:56ZengSAGE PublishingSAGE Open2158-24402020-01-011010.1177/2158244019901249Testing for Bubbles in the Chinese Art MarketXin Li0Chi-Wei Su1Meng Qin2Fahai Zhao3Ocean University of China, Qingdao, ChinaQingdao University, ChinaGraduate Academy, Party School of the Central Committee of the Communist Party of China (National Academy of Governance) Beijing, ChinaShandong University, Jinan, ChinaThis article detects the existence of bubbles in the Chinese art market and investigates when the bubbles originate and crash. We utilize the generalized supremum augmented Dickey–Fuller (ADF) test to detect explosive behavior in the Chinese art market. The empirical results indicate that there are two bubbles in the Chinese art market that happened in the periods from 2004 to 2005 and 2010 to 2011. The main reasons are the financialization of artworks, the speculation of investment institution, and the fluctuation of macroeconomics in China. Our findings are in agreement with the bubble model improved by Gürkaynak considering that asset price can be decomposed to bubbles and fundamental parts. Therefore, to favor the Chinese art market price stabilization, the regulators from this market should identify bubbles to notice their evolutions. The authorities should also manage the expectations of the public and reduce speculative behavior.https://doi.org/10.1177/2158244019901249 |
| spellingShingle | Xin Li Chi-Wei Su Meng Qin Fahai Zhao Testing for Bubbles in the Chinese Art Market SAGE Open |
| title | Testing for Bubbles in the Chinese Art Market |
| title_full | Testing for Bubbles in the Chinese Art Market |
| title_fullStr | Testing for Bubbles in the Chinese Art Market |
| title_full_unstemmed | Testing for Bubbles in the Chinese Art Market |
| title_short | Testing for Bubbles in the Chinese Art Market |
| title_sort | testing for bubbles in the chinese art market |
| url | https://doi.org/10.1177/2158244019901249 |
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