Putting A Price On The Priceless

Let’s say someone is both an expert photographer and a very talented painter. She snaps a photo, then paints a realistic version of the image that is indistinguishable from the photo. Which one is better?

If you can’t tell the two pieces apart, does it even matter? If art were only about the aesthetic, the answer would be no. But a work of art is about more than that. Context is everything in the art world—the artist’s process, the story behind the art, and the historical importance of the finished work all figure into its value.

So why is some art so expensive?

Within most markets, the price of an item is directly related to the materials used in its creation. A home with solid oak floors sells for more than one with flimsy linoleum. A purse made of soft leather fetches a higher price than one woven from jute. Durability, comfort and design all come into play.

Not so with the art market. Two artists can start with the same canvas, paints and brushes, yet the price difference that their finished works command can be in the millions, even hundreds of millions of dollars. In some cases, this is true even when the two pieces look the same. Contemporary artist Jackson Pollock has been an especially attractive target for forgers because of his free-form, layered “drip” style. Yet as several unfortunate buyers have found out the hard way, no matter how good the forgery, the market still values an authentic Pollock more.

Art is expensive for several reasons, ranging from the sublime to the practical.

Good art is good art. It’s captivating to see the result of a special artistic talent. The curve of a sculpture, the pop of a well-placed blue, the expression of a social statement in a visual format—art evokes emotion and speaks to our common humanity. For some collectors, capturing a bit of brilliance is reason enough to pay a hefty sum.

Dead artists can’t create. There will never be a new work by O’Keefe, Van Gogh or Basquiat. Even the most prolific artist creates a finite number of works over a lifetime, and for some tortured souls, that isn’t very long. Scarcity can drive price. On the other hand, the works of living 50-year-old artist Damien Hurst have been decreasing in value, partially because so much of his work is readily available for sale, and because the expectation is that he’ll have many years to make more.

Fine art is a fairly stable investment. It behooves everyone operating within the highest strata of the art world to maintain high prices. Art can be a relatively safe place to invest a large sum of money in a small space. Still…caveat emptor. In one case, an Ohio art collector is suing a gallery for a $1.4 million refund on a piece by artist Cady Noland after she made it clear that the gallery’s pre-sale restoration work was not done with her approval.

It’s an unregulated market. Auctions are ripe for questionable activity. Auctioneers can ‘see’ imaginary bidders to keep a work from selling for too little. Collectors may enlist representatives at auction or among gallery owners to ensure prices stay above a certain level in order maintain the value of their other works by the same artist.

Familiarity breeds interest. People tend to value art more highly when it looks like something they’ve already been told has value or is by a well-regarded artist.

In the end, the value of art depends a lot on its brand. For those who buy art as an investment, sticking with the brand names is the safest bet. For those who buy art because they love it, who or how it was produced becomes irrelevant. For the lucky art-lover, they can have the best of both worlds.

« | »