Meet Patrick Verwijmeren

As a child, growing up in Rotterdam, I did not particularly think much about what I wanted to be when I grew up. I really lived in the moment, like many kids do. Back then, I was mostly playing football. When I was a student, I still really enjoyed playing sports and hanging out with friends, but I also took my studies seriously. My focus was to develop myself while having fun at the same time. This was also visible when I ran a bar with some of my friends during college. 

I started my career in academia almost by coincidence. When writing my master’s thesis, my supervisor commented that I had talent and should consider doing a PhD. As I had enjoyed my time at the university – such a young and ambitious environment – I decided to stay at Erasmus and take on the challenge. My development as a researcher went in stages. The beauty of research is that you have questions and then try to come up with ideas on how to answer those questions. Luckily, people liked the questions I came up with and appreciated my insights on those questions. After my PhD, taking advantage of the international aspect of scientific research, I moved to Australia to continue my research there. I worked hard, got published in high-quality journals, and the ball kept rolling. 

Research

My main topic of research is hard to define, as there is a lot of variety in the things that I study. One area of research is the financial return on art. At the beginning of this century, studies appeared that claimed that art is a really good investment, with financial returns that are even higher than those on stocks. These studies concluded this by looking at paintings being sold at auction. However, when comparing art to stocks, one should realise that for stocks you can observe the stock price of any given company at any given moment, while this is not the case for art. For paintings, you only observe market prices when the artwork sells. I found out that the paintings that sell have a higher valuation than the ones that do not sell or take longer to sell. In other words, if you look at the returns of auctioned paintings, you will only see the paintings that did well, but not those that got out of fashion. To get an estimate of the real return on art investments, you will also have to take the less popular paintings into account. By incorporating sample selection biases, I discovered that the actual returns on art are lower than people previously thought. In fact, stocks are a better investment than paintings, on average. Of course, if you can predict the demand for art, you could very well invest in a particular painting, and I also find interesting differences across art styles.

Remarkable publications

I think the academic world liked my research on art by improving the econometric technique to account for self-selection, while practitioners found the estimates of the actual return on art and stocks useful. The article was picked up immediately after releasing it. Within a few days, we received calls from a range of newspapers, such as the Wall Street Journal. Together with related work that I have on a gender gap in art, this was my article that was picked up the most, and my art research was featured in Forbes and the Economist, among others. I think disseminating research findings to popular media is highly important, and I am continuously trying to come up with new research ideas that might be of interest to society.