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section heading icon     business

This page considers the retail end of the art market - dealers and auction houses - and other collectibles markets.

It covers -

     introduction

As the preceding page noted, intermediaries between the creator (or discoverer) and the collector are fundamental to the overall circulation of cultural commodities.

They are of interest because some have been instrumental in support and recognition of creators, for example by providing stipends for emerging artists and promoting their works through scholarly catalogues.

They are also of interest as businesses, enterprises in which the beauty of the objects that they handle and the plushness of rhetoric about dealing in the results of genius are offset by practice that is exploitative or even distinctly illegal.

It is common for people to conceptualise the 'art market' as consisting of - or merely dominated by - a handful of auction houses and major dealerships. That conceptualisation has been fostered by those entities, both to enhance their strategic position vis a vis competitors and as a foundation for advocacy in resisting initiatives such as Droit de Suite.

It is clear however that the 'art business' encompasses a wide range of businesses engaged in first sale and resale of works and a diverse ecosystem of service providers - some of considerable scale, others very small, some restricting their operation to the art market, others (such as insurers) operating in numerous markets.


It is important to remember that, however gorgeous the commodities, most enterprises in the art market are indeed businesses. Underneath the glitter many are similar to used car dealers. They operate on a commercial basis and may indeed achieve returns on investment that are significantly greater than peers in less glamorous markets. They are not immune to considerations of cash flow, risk, marketing and diversification. The dominant auction houses for example make a substantial portion of their revenue as financiers rather than merely as providers of a platform on which a seller and purchaser can shake hands.

     the market

For more recent times see the lucid From Monet To Manhattan: The Rise of the Modern Art Market (New York: Random House 1992) by Peter Watson and True Colors: The Real Life of the Art World (New York: Atlantic Monthly Press 1998) by Anthony Haden-Guest.

Francis Haskell's Patrons and Painters: Art and Society in Baroque Italy (New Haven: Yale University Press 1980), Richard Goldthwaite's Wealth and the Demand for Art in Italy, 1300-1600 (Baltimore: Johns Hopkins Uni Press 1993) and Lisa Jardine's Worldly Goods: A New History of the Renaissance (London: 1996)

There is a broader view in Muses and Markets: Explorations in the Economics of the Arts (Oxford: Blackwell 1989) by Bruno Frey & Werner Pommerehne, Gerald Reitlinger's pioneering three volume The Economics of Taste (London: Barrie & Rockcliff 1961, 1963, 1971), Creative Industries: Contracts Between Art & Commerce (Cambridge: Harvard Uni Press 2000) by Richard Caves and Moving Rooms: The Trade in Architectural Salvages (New Haven: Yale Uni Press 2007) by John Harris.

     galleries and other dealers

What of the middlemen in the chain from the creator to the consumer and thence to a curatorial institution or oblivion?

The Economist commented in 2007 that

They are the saints of the art world—supporting struggling artists, shining a light on unacknowledged genius, exemplifying the highest standards of scholarship and connoisseurship; and also the sinners, accused of every possible skulduggery in pursuit of a higher price for their artists and a higher profit for themselves.

Much art (and other commodities such as books, coins and carpets) has traditionally been sold by dealers, usually operating from a discrete venue. Some dealers have bought direct from artists; others have acquired works from earlier buyers or finders (including consumers, other dealers, excavators and even curatorial institutions). They have purchased work outright or sold on consignment, with the dealer's cut of the sale price usually being in the range of 30 to 50%. Some possess considerable expertise and build value through discerning catalogues or mere endorsement; others have the skills and ethics of a dodgy used-car salesperson despite assertions that art dealing is an occupation for gentlemen and girls with blue blood.

Some dealers have gained fame for supporting artists through thick and thin, indeed treating them as a member of the family. Others have clearly exploited and even cheated their artists, brazenly disregarded laws about the export of antiquities, knowingly handled stolen or expropriated property, and misled potential buyers.

A handful of the several thousand commercial galleries in Australia and New Zealand account for most of the turnover, unsurprising when the price of a Brett Whiteley oil can be greater than the aggregate annual turnover of all galleries in the Riverina.

For an overview of the US see Landscape with Figures: A History of Art Dealing in the United States (New York: Oxford Uni Press 2000) by Malcolm Goldstein.

Accounts of exemplary dealers feature in works on Vollard, Kahnweiler, Cassirer, Matisse and Gimpel. Misbehaviour in the handling of antiquities is highlighted in works such as The Medici Conspiracy: The Illicit Journey of Looted Antiquities - From Italy's Tomb Raiders to the World's Greatest Museums (New York: PublicAffairs 2006) by Peter Watson and Cecilia Todeschini and here. Egregious offences by the Marlborough Gallery are profiled in The Legacy of Mark Rothko (New York: Da Capo 1996) by Lee Seldes. There are more gentle or self-serving accounts in The Art Dealers: The Powers Behind the Scene Tell How the Art World Really Works (New York: Potter 1984) by Laura de Coppet & Alan Jones.

For entertainment see Julien Levy's Memoir of an Art Gallery (New York: Putnam 1977), Richard Feigen's Tales from the Art Crypt (New York: Random 2000), Marius de Zayas' How, When and Why Modern Art Came to New York (Cambridge: MIT Press 1998) and John Myers' Tracking the Marvelous A Life in the New York Art World (New York: Random 1983). Classics include Rene Gimpel's Diary of an Art Dealer (New York: Straus & Giroux 1966) and Ambroise Vollard's Recollections of a Picture Dealer (London: Constable 1968).

Academic and popular biographies include Pierre Matisse and His Artists (Vancouver: Uni of British Columbia Press 2003) by William Griswold, Pierre Assouline's An Artful Life: A Biography of D H Kahnweiler, 1884-1979 (New York: Grove 1990), Lee Hall's Betty Parsons: Artist, Dealer, Collector (New York: Abrams 1991), Lindsay Pollock's The Girl with the Gallery: Edith Gregor Halpert and the Making of the Modern Art Market (New York: PublicAffairs 2006)

For Australia see works such as Degenerates and Perverts: the 1939 Herald Exhibition of French and British Contemporary Art (Carlton: Miegunyah 2005) by Eileen Chanin & Steven Miller, Rebels & Precursors: The Revolutionary Years of Australian Art (Melbourne: Allen Lane 1981) by Richard Haese, The Early Sydney Moderns: John Young and the Macquarie Galleries, 1916-1946 (Sydney: Craftsman House 1988) by Jean Campbell, Rex Nan Kivell features in the ADB and an NLA exhibition.

     auction houses

Despite efforts to legitimate activities with a veneer of faded gentility and disinterested connoisseurship the contemporary fine arts auction houses - which have expanded into dealing in other collectibles and services such as upmarket real estate brokerage - are essentially creatures of the 1960s and 1970s.

Prior to that time most upmarket works were sold by dealers (for example Knoedler and Duveen in the fine arts). Much of what was sold by auction houses went to dealers who sold the items to individual or institutional buyers.

For Sotheby's and Christie's see in particular Peter Watson's Sotheby's: The Inside Story (New York: Random House 1997), Sothebys: Bidding for Class (London: Little Brown 1998) by Robert Lacey, Inside Christie's (London: Hodder & Stoughton 1990) by John Herbert and The Art of the Steal: Inside the Sotheby's-Christies Auction House Scandal (New York: Putnam 2004) by Christopher Mason.

Eric Gibson sniffed that

Auctioneers tend to be insecure about their line of work, a fact illustrated by an old saw about the difference between Sotheby's and Christie's: One consists of auctioneers trying to be gentlemen; the other of gentlemen trying to be auctioneers.

So, for example, auctioneers dress up in black tie to conduct the big-ticket auctions--to make sure you don't confuse them with other folks around the country who knock down hogs and repossessed cars for a living and to gloss over the fact that they'll, well, sell anything. (Remember Andy Warhol's cookie jars?) Keep a few former museum directors on the premises and not only do you get their expertise but you can hold your head up a little higher.

     regulators

Do the 'gentlemen' need regulation? Sotheby's executive David Nash grizzled that its critics have "a hostile proletarian attitude toward our business".

Robert Hughes more perceptively noted that

the art market in general, including the auction business, is not a profession. It is a trade, a worldwide industry whose gross turnover may be as high as $50 billion a year. Like other trades, it contains a large moral spectrum between dedicated, wholly honest people and flat-out crooks. It has never earned the right to be considered either self-policing or self-correcting.

It needs regulation, but consumer affairs -- overburdened with the million complaints about small and large business violations that arise in New York, which it was created to deal with -- may not be equal to this task.








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