Art market and How does it influence the production of contemporary art - Essay Example

For as long as there has been a notion of art, there has always been a market for it. It is true that the earliest examples of visual art, the cave paintings were possibly not bought or sold, but then they were part of one ritual or the other, and were scarcely thought of as “art”. But by the time the concept of “art” was well developed it became as much a commodity as an aesthetic expression, and the Renaissance masters painting their subjects from the bible for religious purposes in chapels did so only after receiving sufficient remuneration. Art therefore has always had something to do with financial compensation, as Colin Painter has pointed out : Serious arts criticality is....both economic and ideological. What sustains its specific character and social value is its political economy. The serious art world is at core an argument about value. It is an argument about aesthetic, moral, social and political or whatever value but it is also, and indissolubly, an argument about financial value.(Painter, 2002) The art market then, deals with the buying and selling of art and has its set of players just as in any area of commerce. Tyler Cowen aptly interprets art in its economic aspects: Art markets consist of artists, consumers, and middlemen, or distributors. Artists work to achieve self-fulfillment, fame, and niches. The complex motivations behind artistic creation include love of the beautiful, love of money, love of fame, personal arrogance, and inner compulsions. ..Consumers and patrons stand as the artists silent partners..... consumer and patron demands for artworks finance the market....Distributors bring together producer and consumer......The resultant meeting of supply and demand fuels the creative drive and disseminates its results. ...Creators respond to both internal and external forces. Internal forces include the artists love of creating, demands for money and fame, and the desire to work out styles, aesthetics, and problems posed by previous works. External forces include the artistic materials and media available, the conditions of patronage, the distribution network, and opportunities for earning income.....These internal and external forces interact to shape artistic production. Psychological motivations....... do not operate in a vacuum, independent of external constraints. Economic circumstances influence the ability of artists to express their aesthetic aspirations. Specifically, artistic independence requires financial independence and a strong commercial market. (Cowen, 2000) This clearly states that the artists motivations for creating art is not just psychological but also financial. Art has been bought and sold through the centuries, starting from roughly the sixteenth century it continued into the twentieth century, when art collection came into its own, and a regular class of art distributors or dealers was born. Collection became the passion of big businessmen, instead of being the exclusive hobby of the ruling class alone. Art collectors collected for the sake of the aesthetic satisfaction their purchases gave them, also to be known for their taste and the ability to spend money on what were essentially luxury items. Art..... often celebrates wealth, power and the status quo. Indeed, art is a product in many respects, to be consumed through auction and gallery sales, museum patronage, reproductions, commercial art and so forth. The line between art and commerce is a blurry one; many artists specifically produce things to be sold, artists letters from the past are full of references to monetary matters....(Patterson, Brown, 2000) But all of this gained a new dimension through the pioneering work of Michael Moses and Jianping Mei who came up with the Fine Art Price Index in 2002. They studied the original works of art that were resold through auctions at places like Sothebys and Christies through the last 50 years and found that though these works of art showed lower returns than stock, they showed much higher returns than bonds or securities: “we find art outperforms fixed income securities as an investment, though it significantly under-performs stocks in the US. Art is also found to have lower volatility and lower correlation with other assets, making it more attractive for portfolio diversification than discovered in earlier research”.(Mei, Moses, 2002) This research back up has been the first piece of really solid evidence which meant that identified art as a strong investment proposition which should be part of every smart investors portfolio. Investment funds have been started up for buying art and they have brought art into the area of pure buying and selling: the only concern is how much the art work would appreciate in future years not its intrinsic value in terms of owning a piece of aesthetic achievement. Art investment funds represent something of a revolution in the relationship between art and commerce. Art collecting has traditionally been the domain of wealthy individuals in search of rewards beyond the purely financial.....The new funds, by contrast, allow people with smaller bankrolls to play the art market by pooling their resources, and the only benefits are economic, since investors don’t get to hang the paintings on their walls. In this scheme, art is just another “alternative asset class,” like gold or wheat.(Surowiecki, 2005) Secondly, and perhaps more importantly for our discussion, the duo of economists Moses and Mei also found that : “There is strong evidence of under performance of masterpieces, meaning expensive paintings tend to under perform the art market index”. ( Mei, Moses, 2002 )This has meant a strong pull of dealers and collectors towards emerging contemporary art rather than conventionally established masterpieces, because these can be bought at lower prices and can be expected to bring in high returns in a few years:“Contemporary art has never been more fashionable. At the Frieze Art Fair, which opens in London this month, collectors will spend an estimated £35m over five days. Tate Modern attracts more than four million visitors a year, and there are plans to open a £165m extension in time for the Olympics in 2012”. ( OKeeffe, 2006) The art market has seen an influx of buyers from all over the world, collectors from as far and wide as Brazil, Russia, the Middle-east, China and India are flocking to the auctions in the U.S. and Europe in search of a piece of contemporary art which would later prove to be a great investment. "The contemporary art market is good, in fact it is better than good," says Fernando Mignoni, the director of post war and contemporary art for Christies auction house...."At our last two auctions in London in June and New York in May, both achieved the highest totals ever for a sale in these categories. The contemporary art market is now outperforming other categories.".....Mignoni says the reason for the upturn is the emergence of a younger breed of private collector who, unlike their conservative predecessors, are more inclined to forward thinking, looking for future trends and work that they can relate to”. (Neild, 2006 ) This has meant that there is a great demand for talented contemporary creations like those of Damien Hirst whose “The Physical Impossibility of Death in the Mind of Someone Living” which had a dead tiger shark suspended in a glass tank of formaldehyde created quite a furore in 1991. This has also brought the dealers (who are now basically investors) like Charles Saaatchi to the forefront because they have been able to artificially inflate prices due to high demand by simply creating a hype around a chosen artist. Hirst was an artist whose works were priced between [pounds sterling]5,000 and [pounds sterling]10,000. Saatchi made him a celebrity. At auction, Hirst now sells for up to 150 times as much, privately up to 1,000 times. A nice little earner for his collectors. But it is not just about the money, it is the game that Saatchi loves - making a market where there was none before and then capitalising on his creation. (Barker, 2005 ) For artists like Hirst, or even hot young graduates from art schools who get paid intoxicating sums for their work considering their experience at fairs like the recent Frieze Art fair in London, there seems to be a lot of economic motivation. In the contemporary art market therefore, it is not just the quality of the work that determines the price of a work of art, it also depends on the popularity and reputation of the artist; what the art critics and commentators have to say about him or her, and whether the previous buyers of the artist were celebrities or well-known collectors. The business of art is conducted much like any other commercial venture in which something is bought, sold, or traded, and yet a work of art is not a commodity in the ordinary sense. Its value can fluctuate radically in an instant, depending on the influence of collectors, dealers, curators, critics, or connoisseurs. Their assessments of historic, intellectual, and aesthetic values affect a works monetary value in the marketplace. (Getty, 2004) One of the factors that gives tremendous importance to the scholar or art critic in the contemporary art market is that the buyers and collectors today are mostly people who are not well-informed about art and its intrinsic value, but have jumped on to the collecting bandwagon because of its sound investment possibilities. They thus rely less on what they see, and more on the opinions they hear about a work of art from art critics before “investing” in it. “There are warning signs that many people who’ve recently bought in the contemporary market have been swayed “by fashion rather than quality”, says Will Bennet in The Daily Telegraph. Theo Westreich, a New York art dealer, agrees. He tells Barron’s that collectors are being guided by market buzz, rather than knowledge or insight”. (Clarke, 2006) This translates into a great amount of pressure on the artist to create, and create something that would be lapped up by art critics, galleries and investment-hungry collectors, which many feel could be affecting the standards of contemporary art, because there is not enough psychological or internal motivation, but overwhelming external motivation in the form of hundreds of thousands of dollars. Whereas massive price tags were once reserved for the enigmatic smiles and religious symbolism of gloomy old masters, art bidders are just as likely to get their checkbooks out for the pop and shock of cutting-edge creativity. While this is clearly good news for artists, it does raise concerns for the state of the current art scene. Stripped of the traditional muses of poverty and despair and constantly tempted by the prospect of raking in stacks of greenbacks, are contemporary craftsmen in danger of compromising their visions?(Neild, 2006 ) Another art market that has recently emerged is that of traditional folk art, Australian aboriginal art for instance, which has seen a sea-change in terms of being collectible: When perception of it shifted from ethnographic curiosity to vibrant, contemporary art with an edgy, different element, a whole market grew around it. Recently, this niche market flipped even further into the mainstream, as it became clear that buying the works of certain artists, particularly those sought after by international collectors, is financially smart.......Work by the late Warangkula is one such safe bet. One of the original 1970s Papunya painters, he is believed to have sold his painting Water Dreaming at Kalipinypa in 1973 for $150. It sold at Sothebys in June 1997 for $210,000; three years later, it fetched $486,500.( The Sydney Morning Herald Online, 2003) But this genre of art which has been the medium of self-expression for some of the oldest peoples in the world is also suffering a fall in quality because of the increasing pressure to produce more and more: “Its like a dumbing down. The pressure is on the artist to produce ... to become a commodity. Sure you want to make a living out of it, but [you also produce work] because you have something to say,...”( The Sydney Morning Herald Online, 2003) But where on one hand the booming art market has built up a negative pressure on Western contemporary artists and aboriginal folk artists alike, it has proved to be a boon for the emerging artists in the Asian art market, especially China and India. An artist like Zhang Xiaogang who had lived through the ten years of the cultural revolution is extremely popular, whose work Amnesia and Memory: Man created in 2003 fetched a sum of $884,000 in Sotheby’s New York in September this year. In India, the increasing globalisation of the art market has opened the way for a new wave of alternative media in a basically conservative domestic art scene. One very real benefit of globalisation for the Indian art market has been the slow chipping away of its inherent conservatism. Much is said and written about India’s booming contemporary art market. But this is still a deeply traditional market that favours oil painting and conventional imagery to any other type of product. Enter the international museum curator (and now, increasingly, the savvy international private collector) who favours an artistic practice that is experimental and theoretical, engaged with the unpleasant realities of social and political tensions, more confrontational than assuring, unafraid of the messy vitalities of life. It is this type of art — practiced by artists like Sheba Chhachhi, Ayisha Abraham, Shantanu Lodh, Tejal Shah, Sharmila Sawant and Inder Salim — which is showcased abroad and subsequently purchased both by important museums and influential private collectors. ( Nagy, 2006 ) The success of movement into different media in the contemporary art market has allowed artists to experiment with various instruments and techniques, where the canvas can be a digital monitor and the brushes used could actually be software. Performance, installation, interactive media art are all part of the contemporary art market. “The continued development of new medias has increased the diversity and production of art away from two-dimensional canvas with video and sound audio, although photography is obviously two-dimensional. These new developments such as photography, video and digital processes are more accessible by the mass media”(Evans, 2005). And with the coming in of the internet, such art is easily and instantly accessible to virtual communities, making contemporary new media art less exclusive. It is this constant search for a new mode of expression driven by a hungry market that may be responsible for the plurality and undefinability of contemporary art. It is very hard to chalk down contemporary art trends into various schools, most of it is too experimental, diverse and temporal to be classified easily. But the urge to find a niche leads to a sort of branding, a branding it becomes difficult for the artist to escape. He or she is bound to create in the signature or niche they have created for themselves to be marketable, and hence limit their creative potential: “It is possible, to be sure, that the need to find a marketing niche is responsible for the pluralism apparent in recent contemporary art. Unfortunately, artists who find such a niche also find themselves caught in what Joseph McElroy has called "brand slavery"--the inability to sell works outside of a signature style for which they have become known”. (Sabater, 2004) Thus one may criticize the art market for artificial inflation of prices, for the prevailing favoritism and fawning, for the dumbing down of art, for making artists create art only for the sake of money, and for genuinely deserving shy artists being sidelined in favor of undeserving ones who are able to market their art. It is also true that out of thousands of artists that try, the market picks up a handful, and the agents and dealers often benefit more than the artists themselves. But the commercial success of the few inspires innumerable others and helps discover more hidden genuine talents than ever before. The present boom may not encourage the creation of masterpieces or entire new genres, but the art market today is possibly the hotbed for the titans of tomorrow, because the buyers and collectors are learning how to appreciate great art, and in the process developing a discerning taste. They should be ready for the masters when they arrive: “The modern art market not only brings art consumers in touch with the artworks that will please them, but also has achieved remarkable successes in educating buyers towards new tastes. Each set of new styles, although regarded as inaccessible by the previous generation, has been embraced by the next.”(Cowen, 2000) Works Cited Barker, G. (2005). Is Charles in Charge? The Evening Standard. Issue: February 4, 2005, p. 21. Brown, S., Patterson, A.(eds.) (2000) Imagining Marketing: Art, Aesthetics, and the Avant-Garde London: Routledge. p.39. Clarke, J. (2006).The art market is booming, but you should still be wary.Money Week. Issue 12.05.2006. Retrieved October 25 , 2006 from http://www.moneyweek.com/file/12582/the-art-market-is-booming-but-you-should-still-be-wary.html Evans, R.(2005). Has painting in recent years been less prominent since the introduction of new media? Retrieved October 25 , 2006 from http://www.saatchi-gallery.co.uk/contemporary-art/painting-less-prominent-since-new-media.htm Mei, J, Moses, M.(2002) Art as an Investment and the Underperformance of Masterpieces. Retrieved October 25 , 2006 from http://pages.stern.nyu.edu/~jmei/artgood.pdf Nagy, P. (2006). Decentering the Art World. Tehelka.Retrieved October 25 , 2006 from http://www.tehelka.com/story_main19.asp?filename=hub092306globalwarning_7.asp Neild, B. (2006). Doing it for the money.When it comes to cash, are artists painting by numbers?.CNN Issue March 29, 2006. Retrieved October 25, 2006 from http://edition.cnn.com/2006/SHOWBIZ/03/15/modernmasters.money/ OKeeffe, A. (2006). Contemporary art special.New Statesman. Issue:Monday 9th October 2006. Retrieved October 25 , 2006 from http://www.newstatesman.com/200610090032 Sabater, L.(2004)Why Art Should be Free. Culture Kitchen. Retrieved October 25 , 2006 from http://www.culturekitchen.com/archives/000482.html Surowiecki, J.(2005). Cash For Canvas. The New Yorker,The Financial Page. Issue 2005-10-17 Retrieved October 25 , 2006 from http://www.newyorker.com/talk/content/articles/051017ta_talk_surowiecki The J. Paul Getty Trust. The business of art: evidence from the art market, March16-June13, 2004. Retrieved October 25 , 2006 from http://www.getty.edu/art/exhibitions/business/ Tyler, C. (2000) In Praise of Commercial Culture. Cambridge, MA: Harvard University Press.p.125. Whitefella dreaming.(2006) The Sydney Morning Herald Online. Issue: November 15, 2003. Retrieved October 25 , 2006 from http://www.smh.com.au/articles/2003/11/14/1069027174339.html Read More