Contemporary Art World -101

Why an artist gets a particular price for a particular work is the $64,000 question.  As we see so clearly now, markets for everything from stocks to tulip bulbs to internet companies can be totally irrational and volatile.  However,  the art market has NO bottom line, NO eventual bankruptcy,  no logical basis for any valuation except for the perception of the art world – art historians, critics, collectors, gallerists, etc. The way this art world values one artist over another or the even value of one work of art by an artist over a similar work by the same artist,  can be seem capricious and illogical and often is.  However, behind the seeming volatility,  there are some basic  themes of pricing that one should be aware of and this blog will address those themes as they come up.

In the end, history determines the value of a work of art, and one important determining factor is the importance of an artist as an influence on his generation.  Many art historians feel that Marcel Duchamp and Andy Warhol were the two most important artists of the 20th Century in terms of influence, which would explain the incredible strength of the Warhol market, but not explain the relative weakness of the Duchamp market.  These two equally important 20th influences have radically different markets, because of a million different factors – and the way the market values these equally important figures points to its irrationality.  Duchamp made relatively few pieces, and most are in museums, so you would assume that a rare Duchamp would bring record breaking prices.  Not so.  They’re expensive for sure but not compared to less important pieces on the market. Warhol made literally thousands of pieces of art, maybe hundreds of thousands – but a good Warhol is in fact, record- breaking.  So every artist of historical importance has a specific market which has its own peculiarities.

However, Alan Bamberger on his web site www.artbusiness.com claims that most art prices are logical and shows how to figure them out. I haven’t double checked his rigorous analysis, and don’t intend to, as I really don’t care about long term art prices presonally.  I just buy what I like.  Silly me.  But I realize he does have some valuable insights and if you’re interested in INVESTING, you should definitely check him out.