WHY DO works of art cost what they do? I'm not saying they're expensive, or cheap—I'm wondering how people price them at all, and whether the determinants change over time. Why $73m for a Rothko, and not $7.3m, or $173m?
I'm willing to bet that if you ground through a lot of numbers (I betray my laziness with those words) you would find a persuasive correlation between the prices paid for masterpieces in a given decade on the one hand, and some confection of three variables on the other: the size of the market for such things (which is to say, the degree of globalisation in the world economy); average wealth in the economies making up the market; and a pattern of wealth distribution providing for a large-ish tier of people at the top with money to burn. But pending some model of absolute values, I'll settle for the rules of thumb governing relative values set down by ace blogger Tyler Cowen in his new book, “Discover Your Inner Economist”:
1 Landscapes can triple in value when there are horses or figures in the foreground. Evidence of industry usually lowers a picture’s value.
The basic determinant of relative price for new art is size. For any given artist, the bigger the painting, the higher the price tag in the gallery, save for very big paintings, which start going to a discount. Paintings of the same size carry the same price. This may seem a dumb strategy: why not charge more for the paintings which the gallerist judges to be the best? The answer seems to be that if the gallery indicates by its pricing which paintings are "good", nobody will want the "bad" ones. The gallery is better off behaving as if they are all equally good.2 A still life with flowers is worth more than one with fruit. Roses stand at the top of the flower hierarchy. Chrysanthemums and lupines (seen as working class) stand at the bottom.
3 There is a price hierarchy for animals. Purebred dogs help a picture more than mongrels do. Spaniels are worth more than collies. Racehorses are worth more than carthorses. When it comes to game birds the following rule of thumb holds: the more expensive it is to shoot the bird, the more the bird addas to the value of the painting. A grouse is worth more than a mallard, and the painter should show the animal from the front, not the back.
4 Water adds value to a picture, but only if it is calm. Shipwrecks are a no-no.
5 Round and oval works are extremely unpopular with buyers.
6 An 18th-century Francois Boucher nude sketch of a woman can be worth ten times more than a comparable sketch of a man.
The other thing I hear from galleries is that the acceptable size of paintings is increasing, presumably as houses and walls get bigger too. It used to be that anything more than 3.2 metres high was "too big", and only an institution would want to hang it. Now you can go up to 4m before prices peak.
What I want to know is why the art market has not come to function like the book, music, and movie markets? Why aren't new works of art sold in large numbers as low-cost prints (not limited, 'hand numbered' prints) for large numbers of people to enjoy briefly and then take down? Why the continued commitment to artificial scarcity and the status of 'the original work' as fetish object?
Posted by: Slocum | June 28, 2007 at 08:27 AM
Slocum,
how can posters produced as their own thing compete with posters of musicians, subsidized as advertising?
I can get a Titian poster today. The only way I'd imagine people getting posters of new painters is if they became a new slice of celebrity. That would be lucrative, but difficult to pull off.
I think it amounts to the same thing to say that people consume a lot less wall-space than music.
Posted by: Douglas Knight | June 29, 2007 at 03:18 PM