The art of benchmarking: Picasso prints and auction house performance

The influence of the auction house on the price of comparable art objects is an issue in the economics of arts literature. The standard approach has been to run hedonic price regressions including the auction house as a dummy variable. The approach in this paper is to apply benchmarking tools developed in the efficiency and productivity literature directly to the auction house as a unit. New performance indices are developed based on a DEA benchmarking technique to analyse auction houses. The new indices discriminate well between auction houses by allowing one to identify both contemporaneous and inter-temporal performances. Additional best performance results are obtained for specific attributes.