In fact, large part of the art market is a plain prediction market. A collector buys young artists cheap hoping that the artists will become “historically significant” and their prices will grow as museums will start to buy their works.
Art market is also important to support artists—if nobody will buy artist’s pictures, they will be unable to work. A first year in NY for a young artists costs 200K (often parents life savings), and most of them are also betting on their own genius, market understanding or best idea. I know this based on what one such artist told me. If they fail, they return back to Illinois and work in schools as drawing teachers. So they have to sell 10-20 pictures at 5-10k just to cover costs of renting a workshop and equipment. A collectors could provide needed liquidity by buying bulk of art cheap and investing in the artists promotion. Collector is buying may be 10 or 20 artists and hoping that one or two will reach museum level status.
Museums are buying best art of best (available) artists trying to attract crowds as they have competition with other museums.
I earn money buying and selling art for last 20 years, and here I presented a simple model of this business.
Obviously, museums don’t buy all art, but their exhibition and buying policy creates an beacon of what is called museum-level art, and wealthy individuals want this type of art as it increase their own social status.
These wealthy individuals often end up creating their own private museums. But these small private museums are not as important as largest museums in determining an artsit’s historical significance. Anyway, these small museums tries to get the best possible art (available in their budgets), and their buying is significant source of an art dealer’s income.
Despite the fact that everybody tries to manipulate this market (by promoting their artists), the directions and success of such manipulations may be predicted. The same way this happens in other markets: if I expect that OPEC will cut production, I can earn money on rising oil prices.
Also, an interesting fact was aired on the EA Global London 2018: around 40 per cent of all donations EA got came form a single individual and he is an art dealer. He spoke on the conference and it was said that he earned most of his money selling Picasso’s prints.
Historical significance is a social reality just as much as short-term interest is.
And I think there’s a difference between art-markets-in-the-abstract and art-markets-as-currently-implemented. The former is certainly necessary for professional artists to function in a capitalist society, but I don’t think the latter is. And it’s the latter that the OP seems to be arguing against—not the idea of selling art in general, but the current cabal that rigs the prices.
In fact, large part of the art market is a plain prediction market. A collector buys young artists cheap hoping that the artists will become “historically significant” and their prices will grow as museums will start to buy their works.
Art market is also important to support artists—if nobody will buy artist’s pictures, they will be unable to work. A first year in NY for a young artists costs 200K (often parents life savings), and most of them are also betting on their own genius, market understanding or best idea. I know this based on what one such artist told me. If they fail, they return back to Illinois and work in schools as drawing teachers. So they have to sell 10-20 pictures at 5-10k just to cover costs of renting a workshop and equipment. A collectors could provide needed liquidity by buying bulk of art cheap and investing in the artists promotion. Collector is buying may be 10 or 20 artists and hoping that one or two will reach museum level status.
Museums are buying best art of best (available) artists trying to attract crowds as they have competition with other museums.
From where do you have your information? I’m no expert myself but is was my understanding that museums buying art isn’t the primary driver of prices.
Wealthy people buy art and wealthy people also lend their artwork to museums to be shown and sometimes even donate pictures.
I earn money buying and selling art for last 20 years, and here I presented a simple model of this business.
Obviously, museums don’t buy all art, but their exhibition and buying policy creates an beacon of what is called museum-level art, and wealthy individuals want this type of art as it increase their own social status.
These wealthy individuals often end up creating their own private museums. But these small private museums are not as important as largest museums in determining an artsit’s historical significance. Anyway, these small museums tries to get the best possible art (available in their budgets), and their buying is significant source of an art dealer’s income.
Despite the fact that everybody tries to manipulate this market (by promoting their artists), the directions and success of such manipulations may be predicted. The same way this happens in other markets: if I expect that OPEC will cut production, I can earn money on rising oil prices.
Also, an interesting fact was aired on the EA Global London 2018: around 40 per cent of all donations EA got came form a single individual and he is an art dealer. He spoke on the conference and it was said that he earned most of his money selling Picasso’s prints.
Historical significance is a social reality just as much as short-term interest is.
And I think there’s a difference between art-markets-in-the-abstract and art-markets-as-currently-implemented. The former is certainly necessary for professional artists to function in a capitalist society, but I don’t think the latter is. And it’s the latter that the OP seems to be arguing against—not the idea of selling art in general, but the current cabal that rigs the prices.