4

Art markets Olav Velthuis

On art markets, suppliers and buyers of works of art exchange cultural objects such as paintings, antiquities or sculptures. Within some market segments, such as the market for contemporary art, the objects are directly supplied by the artist, who sells them out of his studio or through a gallery. In other cases, for instance within the market for antiquities or for works of art by deceased artists, suppliers are private collectors or public institutions who want to part with these pieces. Often, intermediaries such as auction houses, art dealers or art consultants are involved to match supply and demand. In 2007, the latest year for which figures are available, the size of the art market was estimated to be €48.1 billion worldwide. This figure, which includes both dealer and auction sales and comprises fine art as well as decorative arts and antiques, was the highest in the history of art markets. Geographically, the art market is dominated by the USA, with a market share of 41 per cent, followed by the UK with a market share of 30 per cent. After World War II, a division of labour emerged between the art capitals of these two countries: in New York the market for Impressionism, modern and contemporary art is concentrated, while London has developed a comparative advantage when it comes to Old Masters. France, until World War II the centre of the art market, has recently been surpassed by China as the third-largest art market (the latter’s market share is 8 per cent). Between 2003 and 2007, the art market grew spectacularly by 311 per cent overall. This was partially caused by new demand from emerging economies, such as China, Russia and India, that gradually became part of global art markets (see below) and by the strong growth of high net worth individuals in Europe and the USA. Within the auction market for fine arts, Impressionist and modern art has long been the most important category, but in 2006 it was surpassed by contemporary art, defined as art made by artists who were born after 1945. In 2007, contemporary art contributed more than 20 per cent of the annual turnover at both Sotheby’s and Christie’s. Between 2003 and 2007, the contemporary art market grew 851 per cent, more than double the average growth of the art market over that period. It is likely that following the financial crisis of 2007–08, the size of the market has shrunk. Indicatively, price levels for contemporary art at auction decreased by 27 per cent between January and December 2008 (McAndrew, 2009; Artprice, 2009). As in previous bust periods, auction houses have reported higher rates of lots that remain unsold. Motives of buyers Three different motivational categories can be distinguished for buyers within art markets. Some are primarily motivated by reasons directly related to the work of art itself: people may buy art because they find it aesthetically pleasing, because they seek to decorate their interior, or because they have a profound artistic interest and are building up a collection of artworks. A second set of reasons is financial: art may be bought as an investment, a store of wealth or as a hedge against inflation. The speculative motive 33 Ruth Towse - 9781848448872 Downloaded from Elgar Online at 11/16/2015 06:54:08AM via Universita Degli Studi Roma Tre

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is the one that cultural economics has focused on (for an early overview, see Frey and Eichenberger, 1995). Most research indicates that, compared with traditional asset classes such as stocks and bonds, rates of return on investment in art are lower and risks are much higher, both in the short and in the long run (see, for example, Ginsburgh, 2003). Only during brief boom periods, such as the second half of the 1980s or between 2003 and 2007, did art outperform traditional asset classes. The widely held belief that art is a safe investment may be caused by widespread media attention on a relatively small number of multimillion-dollar sales. The relative unattractiveness of art as an asset class is partially compensated by the low correlation of returns between art works and financial assets, which suggests that art may be used to diversify a traditional portfolio (Worthington and Higgs, 2004). Finally, art may be bought for social reasons: by buying art, one buys oneself a ticket to a social circle, such as a group of collectors who regularly buy at the same art gallery and meet each other at art-world events. In emerging countries such as India and China, buying art may be a means of expressing membership of a rising middle class. Social reasons for buying art not only include group membership but also its very opposite: art can be used for what the early twentieth-century economist Thorstein Veblen has called ‘conspicuous consumption’ – works of art may enhance the status of their owners among their peers or within society. In this case, properties that are extrinsic to the work of art, such as its high price or the exclusive venue where it is bought, make a work of art all the more attractive for status-oriented buyers. Status-related reasons may also motivate companies to collect art. For instance, financial institutions may thus try to signal to clients that their interests are more encompassing than profit-making only, while directors of the company can enhance their reputation within their peer group by demonstrating their knowledge of art. Although the three sets of motives may be distinguished in theory, in practice, a mixture of all three tends to motivate buyers to acquire art. Indeed, the lower return on paintings compared to other financial assets has been interpreted as evidence of the fact that other motives than merely financial ones are involved: the lesser financial return is compensated by the artistic, decorative, aesthetic or status value that buyers derive from buying a work of art.1 For some parties in the art market, however, one motive may prevail: for instance, since the 1980s some banks and hedge funds have tried to set up art investment funds, albeit with different degrees of success. During the financial crisis, many of them had to close. The pieces owned by these funds are usually kept in storage, making it impossible for the owners to enjoy the artistic or decorative value of the paintings. These funds find their predecessors in investment groups such as the Parisian Peau de l’ours, which, early on, were buying works by Cubist painters such as Picasso and Braque, and made a handsome profit when they sold them in 1914 (Fitzgerald, 1995). By contrast, a public institution such as a museum will focus solely on artistic value when buying a work of art. The rate of return that may be made on this acquisition will be disregarded, if only because deaccessioning, that is selling works of art from a public collection, is considered illegitimate in many museums in Europe and the USA. Only when it is considered a lesser piece, when the museum holds a more or less identical piece, when the museum is in dire straits, or when the work can be exchanged with another party for a more appropriate one, might deaccessioning be an option for a museum.

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Art markets 35 Structure of the market Art markets present an extreme case of trade in heterogeneous goods. For some works of art, no substitutes may exist. Buyers may be interested solely in one particular piece of art made by an artist of their liking, executed in a specific style, and depicting a specific subject matter. The supply curve is in that case fully inelastic. This explains why, at auction, some works by the same artist fetch much higher prices than others. Thus, in theory, the art market may not be seen as a single market but instead as a large set of monopolistic or, in the case of a single interested buyer, monopsonistic markets (see, for example, Moulin, 1967). In practice, however, almost invariably some substitutability does exist: a collector may for instance be interested in owning a work by the American pop artist Andy Warhol, without an absolute preference for one work in particular. But even then, when the artist is deceased, supply must be regarded as fixed. Moreover, within this fixed supply, many works of art by old or modern masters may no longer easily appear on the market, for instance because they are part of museum collections or because they are the property of collectors who are known to be extremely reluctant to sell parts of their holdings. At the very least, a price premium may have to be paid in order to persuade such a collector to sell. Substitutability may be more extensive for a buyer who is interested in art merely for decorative reasons. Such a buyer will consider buying work by a variety of artists, as long as the subject matter is pleasing, and the colours go, so to say, with the couch. Likewise, a starting collector may not have a fully developed taste or may have decided only that s/he will be buying contemporary rather than modern or pre-modern art. Within those categories, his/her taste may be influenced by what artists, art dealers or other intermediaries are offering for sale. In that sense, all dealers operating within the same region are competing for the scarce resources of such collectors. Competition is not based on price, however, but on the capacity of dealers to convince the collector of the work’s lasting artistic and economic value and on their ability to influence and shape the collector’s taste. Finally, substitutability may be almost perfect in a wholesale market for art where, by and large, mass-produced, anonymous paintings and multiples are exchanged between parties such as hotel chains or tourist retail stores and art production companies (Fitz Gibbon, 1987). In those companies, which frequently have their production facilities in China, art is produced in an assembly-line fashion, with many employees working on the same pieces of art, according to a strict division of labour in order to increase productivity. The wholesale trade of these paintings frequently takes place through the Internet or at specialized annual trade fairs. Not only because of its lack of homogeneity, but also in other respects, the art market deviates radically from the textbook theory of perfect markets (Santagata, 1995). First of all, transaction costs are hardly negligible. For instance, at auction, buyers and sellers of works of art may have to pay up to 20 per cent of the sales price. These transaction costs render art even less attractive as a financial asset class (as do insurance and storage costs related to art investments). Second, if the art market is considered as a financial market, its lack of liquidity is striking. A collector who wants to sell his work because he urgently needs cash may need to wait several months before an auction will take place in which this work fits. For many artists, an active resale market may or may no longer

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exist. Some art dealers, such as the illustrious Paris and New York Wildenstein Gallery, are known to have had works for decades in inventory before they finally managed to sell them. Also, unlike assets on financial markets, works of art are hardly divisible. Although some pieces of art have been bought by consortia of investors and collectors, such as Damien Hirst’s diamond-covered skull For the Love of God, it is generally impossible to buy, for example, a one-hundredth share in a painting by Rembrandt. Third, the art market is characterized by a lack of transparency. Information regarding the quality of the art supplied or the willingness to pay on the side of buyers is incomplete, difficult and often expensive to gather. Prices for which art dealers sell works of art are frequently unknown. For instance, the most expensive painting ever was not sold at auction, but through a private deal (as are four other works in the top ten list): the abstract expressionist painting No. 5 by the American artist Jackson Pollock, which according to media reports was sold in 2006 for US$140 million by the Hollywood producer David Geffen. Since neither the buyer nor the seller ever confirmed the sale, we cannot know for sure which work of art is the most expensive ever and who owns it. The lack of transparency is also striking when it comes to the identity of buyers and sellers, whose names are not usually disclosed. Take the extreme case of Vincent van Gogh’s portrait of Dr Gachet, which sold in 1990 for US$82.5 million. The buyer at that time, the Japanese paper tycoon Ryoei Saito, said that he would have the work cremated with him. This did not happen, but after his death in 1996, the whereabouts of the work were unknown to the wider public for 11 years, when media reports said that the work had been sold after Saito’s death to the Austrian fund manager Wolfgang Flöttl. Flöttl subsequently sold it, allegedly because of financial troubles. Its current owner remains unknown. The transparency of the art market has been improved considerably, however, by companies that have specialized in providing market information, for instance regarding the careers of living artists and the galleries that represent them (e.g. artfacts. net) and comprehensive art auction data (such as artprice.com or artnet.com). Because of this, buyers and sellers all over the world may now know instantly where particular pieces of art have been auctioned and for how much. However, lack of transparency remains a problem, and information asymmetries abound on the art market. Some participants may, for instance, have better knowledge about the authorship, authenticity or provenance of a work of art than their competitors, which enables them to make excess returns. For instance, a work may be sold at auction as a work made by a member of Rembrandt’s studio, while some parties may have information indicating that the work was made by Rembrandt himself. Likewise, the New York art dealer Duveen made handsome profits in the early twentieth century on the trade of Italian Renaissance artists through his famous partnership with the art historian Bernard Berenson. After Berenson had confirmed the authenticity of important Renaissance works or reattributed them to more famous masters, Duveen would sell them at high prices to the roster of wealthy American collectors whom he assisted in building up their collections. The widespread existence of information asymmetries provides ample opportunities for fraud and deceit. Forgeries have been created of many Old and Modern Masters; moulds used for sculptures that were promised to be made in an edition of five or ten have been reused to make more copies; the same applies to other multiples such as etchings. In all these cases, the art market is akin to the market for ‘lemons’ discussed by

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Art markets 37 George Akerlof, where the quality of the work is known to the seller but not to the buyer (Akerlof, 1970). Realizing this, interested parties may refrain from buying works of art altogether. In order to prevent this, dealers award certificates of authenticity or hire the services of art experts who should assure buyers of the quality of the works involved. Other forms of fraud, albeit not related to the quality of the work, may occur if artists sell works out of their studio without paying a commission to a dealer who represents them and who is contractually entitled to a pre-negotiated percentage of each sale; or if a dealer sells a work at full price, tells the artist it went at a discount, and subsequently pockets the difference between the two. In order to handle these information asymmetries and the opportunities for deceit they entail, economic interaction on the art market is, unlike the economics textbook’s assumptions, far from anonymous. Instead, participants develop long-term trust relationships that reduce the incentives for mutual deceit. Finally, information asymmetries aside, what characterizes the art market is that it is a market for credence goods. Its value cannot be objectively and individually determined, but relies to a large extent on the credibility of the experts involved in the collective evaluation processes that take place within art worlds. Changing tastes and fashions, on which individual participants in art markets may have little influence, can radically increase or diminish the artistic and economic value of objects within art markets (Bonus and Ronte, 1997). To put it in sociological terms, the value of art is socially constructed, or, as the French sociologist Pierre Bourdieu put it, it is a market based on the production of belief. Not everybody can participate to the same extent in the process of credibility generation. This by and large involves cultural experts such as artists themselves, art dealers, museum curators and art critics, who possess the symbolic capital to bestow value on works of art. This symbolic capital is in turn generated by a mixture of factors such as a longstanding commitment to the art world, extensive cultural knowledge and personal charisma. As Bourdieu has argued, in accumulating this symbolic capital it is crucial that experts signal to the art world that they are not interested in short-run economic profits, but care genuinely about the art itself. In the long run, however, symbolic capital may be converted into economic capital: an art dealer who has become recognized for his selection of artists whose work has and maintains artistic value may in the long run make high profits on the sale of these works (Bourdieu, 1992, 1993). This credence aspect of cultural objects means that the art market cannot be understood properly without taking the role of various cultural institutions into account, such as museums where artworks are exhibited and preserved, ‘alternative’ exhibition spaces like artists’ cooperatives, and the art press (art magazines, newspapers and book publishers that devote considerable attention to the arts). In addition to their cultural functions of exhibiting and reviewing art, putting artworks in a historical or critical context, and educating artists and their audience, these institutions participate in the art market. Museums, for instance, are not only a source of demand on the art market. They also have an indirect economic impact on the art market: they, as well as the art press, are gatekeepers, which means that they make a selection out of the large ‘pool’ of oeuvres and individual artworks that have been made throughout history. Gatekeepers allocate scarce resources to this selection of artworks. In economic terms, this gatekeeping role of cultural institutions serves to reduce information and search costs for economic agents on the market: collectors may economize on these costs if they want to acquire art by taking the judgement of cultural institutions into account. By channelling resources to

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a limited group of visual artists, cultural institutions also enhance superstar phenomena within the visual arts. Finally, these cultural institutions generate ‘credibility’ or ‘belief ’ in the artistic value of art among an audience of museum visitors and art collectors. Several empirical studies indicate that the ‘cultural judgement’ of museum curators and art critics on the one hand, and the ‘economic judgement’ of the art market on the other hand, are correlated (see, for example, Frey and Pommerehne, 1989; Galenson, 2000). This can be interpreted in different ways: either collectors derive extra utility from consuming artworks that cultural institutions deem important; or the taste of collectors is directly influenced by the choices of cultural institutions. Traditionally, cultural economists have abstracted from the latter effect, however, since it violates a core assumption of neoclassical economic theory that tastes are constant. Primary versus secondary markets The art market consists of many segments, which can be categorized in different ways. The most important distinction is between the primary market, where contemporary artists sell their work for the first time, and the secondary or resale market. Since data on the primary market barely exist, this section of the visual arts has been largely ignored in cultural economics. Instead, most studies focus on auction sales on the secondary market. On the primary market, some artists sell their work directly from their studio. Others try to find intermediary institutions such as commercial art galleries. These galleries usually represent 10 to 30 artists, promote their work among art experts, and receive a predetermined percentage of each sale as a compensation for those efforts. Since works of art appear on the market here for the first time, a consensus of art experts regarding their value is by and large absent, uniform standards of value are lacking, and the careers of their producers are frequently unstable, economic value on the primary art market is radically uncertain. In these circumstances, one might expect bidding as a preferred means of setting prices. In reality, auctions are hardly ever used on the primary market. One of the few exceptions was the case of the Impressionists, who in their early days auctioned their work with little success at the Paris auction house Hotel Drouot. More recently, in September 2008, the British celebrity artist Damien Hirst sold off 223 works out of his studio at auction house Sotheby’s, much to the dismay of his dealers. The auction revenue totalled US$200 million, the highest amount ever for a single-artist auction. Although the art press was rife with speculation that his example might signal a watershed change in the primary art market because of the entry of auction houses as new competitors to art dealers, Hirst’s example has not so far been followed. In most Western European countries and the USA, only a small percentage of contemporary artists can make a living from selling their work on the market. Works made by an even smaller percentage of living artists are traded on the secondary market. On the secondary market it is predominantly works by deceased artists that are traded. This segment of the market is dominated by two auction houses – Christie’s and Sotheby’s. The two have historically been engaged in cut-throat competition for clients and works of art. In the 1990s, however, the two auction houses were accused of market collusion: according to prosecutors in the USA, they had divided important clients in order to prevent them from competing over these, and had made secret price-fixing deals over the commissions they ask their clients. After the suit had been partially settled and Sotheby’s

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Art markets 39 CEO Alfred Taubman had been convicted to a jail sentence, competition resumed. In the first decade of the new millennium, financial guarantees appeared as one of the instruments to lure important sellers. With these guarantees, the seller receives a predetermined minimum price. If the work remains unsold at auction because it does not meet a reserve price, the auction house becomes the new owner. If the work is sold above the guaranteed price, the remainder is split between the seller and the auction house. Apart from the auction houses, the secondary art market involves art dealers who either sell works on a consignment basis or buy works for inventory and subsequently try to sell them at a profit. Throughout the twentieth century, this inventory was by and large acquired by art dealers at auction houses, where they were the main customers, but in the last couple of decades, retail clients have started buying at auction as well. Many interactions between the primary and the secondary markets occur. For the works made by a relatively small group of living artists, both markets may be active. While older pieces by the artist may come up on the secondary market, new works are sold by their galleries on the primary market. Some collectors may not be able to acquire pieces by very popular contemporary artists on the primary market because the galleries do not sell them to those buyers with the highest willingness to pay. Instead, they ration the output of these artists through a waiting list or sell the output exclusively to loyal clients, well-known collectors or important public institutions. Other collectors may then circumvent the waiting list by trying to buy the work on the secondary market, providing an incentive to collectors who already own the work to resell it. Another type of interaction between the two market segments relates to pricing. Customarily, art dealers on the primary market tend to adjust price levels to prices achieved at auction, although only in a piecemeal fashion. Vice versa, estimates that auction houses provide in their catalogues tend to be based on price levels on the primary market. Local versus global markets A different type of segmentation of art markets can be made based on their geographical scope. Some markets are by and large locally oriented, with local artists catering for the demand of local collectors. Regional art institutions such as small-scale county museums and the local art press may devote attention to the art that is exchanged here. What goes on within these markets in terms of schools or styles may be influenced by trends in national or global markets, but is hardly noticed or recognized by the latter. At the other extreme are global markets that are mostly concentrated in art capitals such as New York, Berlin or London. Galleries within these capitals often represent artists from many different countries while their clientele may likewise be dispersed geographically. The most important art auctions, which traditionally take place at Christie’s and Sotheby’s in New York in May and November, are likewise marketed globally. To some extent, the art market has always crossed borders. In the sixteenth and seventeenth centuries, artists such as Peter Paul Rubens were travelling through Europe to cater for the demand at courts in France, England and Spain. In the early twentieth century, works made by Italian Renaissance painters and French Impressionists were sold to American collectors. In the 1980s, the newly rich Japanese middle class took an interest in Impressionism. Since the late 1990s, however, art markets have become global to an unprecedented extent: they now encompass many more regions than in the past. New collectors from Latin America, the former Soviet Union and Asia have entered the

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art market, while artists from, among others Mexico, India and China have had their work sold at international auctions and acquired by well-known Western museums and private collectors. Also, market participants now operate more widely than ever before. Auction houses, for instance, have started organizing sales in emerging markets such as Dubai and Hong Kong, while globally operating art dealers have opened up branches or organized exhibitions in those regions. One of the most striking aspects of the globalization of art markets is the rise of the Chinese art market. Between 2003 and 2006, contemporary art sales at auction in China increased 100 times to $88 million, according to data provider Artprice.com. According to estimates, 2000 auction houses and 50 000 art dealers are active within the country. And while in 2002 there was only one Chinese artist part of the list of the world’s top 100 artists (computed on the basis of annual auction revenue), in 2008 this list contained 34 Chinese artists. By comparison, the list held just 20 American artists. In the same year, 44 Asian artists were represented in the list, as against 27 European (Artprice, 2009). One of the most important institutions that has developed over the last decades as part of this globalized art market is art fairs (Quemin, 2008). Art fairs are organized on an annual basis. Participants are usually a hundred or several hundreds of art dealers, each of whom has a booth where they exhibit their highest-quality objects to the thousands of potential buyers who pass by over a period of a week or less. Although local fairs do exist, where participants generally have the same nationality, they tend to have an international character. Art fairs, which originated in the Cologne art fair of 1967, enable both buyers and collectors to economize on search and information costs: while it would be time-consuming and thus costly for a wealthy collector with high opportunity costs to regularly visit all art galleries in his home town, let alone in his home country or all over the world, the fair brings a large selection of these galleries together. For dealers, art fairs are an important venue for meeting new collectors. Some fairs also have an important reputational component: the most prestigious fairs, such as Art Basel, Art Basel Miami Beach and the London Frieze on the primary art market or the Maastricht Tefaf on the secondary market, attract many more applications from dealers than they allow to exhibit. As a result, getting accepted at these fairs functions as a sign of quality or approval that may facilitate sales. Participation in these fairs is costly, however, with admission fees of several thousands to several tens of thousands of dollars, as well as high transportation and insurance costs for the works of art that are exhibited. With their many parties, talk shows and busy crowds that allow for celebrity spotting, art fairs are part of the experience economy, where not only the objects themselves, but also the experience that is generated is valued by consumers. Cultural/economic circuit A final way of segmenting the art market has been developed by the French sociologist Pierre Bourdieu (and similar taxonomies are proposed by various other sociologists and economists). His taxonomy consists of two types of hierarchy. First of all there is the opposition between large-scale production directed at catering the pre-existing demands of a larger audience, and small-scale production meant for an audience that consists mainly of fellow artists, experts, critics and a limited number of other insiders; on different occasions Bourdieu has referred to this opposition as that between the commercial

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Art markets 41 and the non-commercial, between traditional and avant-garde or between bourgeois and intellectual art, between the ‘immediate, temporary success of best-sellers’ and the ‘deferred, lasting success of “classics”’ (Bourdieu, 1993, p. 82; 1992 [1996]). The second hierarchy concerns the circuit of small-scale, avant-garde production, in particular; it is a hierarchy between a young, still unrecognized fraction and a ‘consecrated’, well-to-do fraction of the cultural field, whose work has already been incorporated in the canon. As a result, the avant-garde circuit harbours a wide variety of galleries, from small, idealistic enterprises that try to help beginning artists to show their work, to large, global corporations with offices around the world; within the traditional circuit some dealers represent the expensive and painstakingly realist work of artists who have a waiting list of collectors willing to buy their work, while others sell a wide variety of low-priced works made by artists with no reputation whatsoever. Note 1. Since this artistic and social value is hard to measure, no empirical evidence exists for this interpretation. It is based on the assumption of market equilibrium, which is not fulfilled if total returns on art differ from total returns on other financial assets.

See also: Chapter 2: Art auctions; Chapter 3: Art dealers; Chapter 5: Art prices.

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A handbook of cultural economics

Hutter, Michael, Christian Knebel, Gunnar Pietzner and Maren Schäfer (2007), ‘Two Games in Town: A Comparison of Dealer and Auction Prices in Contemporary Visual Arts Markets’, Journal of Cultural Economics, 31 (4), 247–61. McAndrew, Clare (2009), Globalisation and the Art Market. Emerging Economies and the Art Trade in 2008, Helvoirt: Tefaf. Montias, J. Michael (1987), ‘Cost and Value in Seventeenth-Century Dutch Art’, Art History, 10 (4), 453–66. Moulin, Raymonde (1967 [1987]), The French Art Market. A Sociological View, New Brunswick, NJ: Rutgers University Press. North, Michael (1992), Art and Commerce in the Dutch Golden Age, New Haven, CT: Yale University Press. Pesando, James E. and Pauline M. Shum (1996), ‘Price Anomalies at Auction: Evidence from the Market for Modern Prints’, in Victor A. Ginsburgh and Pierre M. Menger, Economics of the Arts. Selected Essays, Amsterdam: Elsevier, pp. 113–34. Plattner, Stuart (1996), High Art Down Home. An Economic Ethnography of a Local Art Market, Chicago, IL: Chicago University Press. Quemin, Alain (2006), ‘Globalization and Mixing in the Visual Arts. An Empirical Survey of “High Culture” and Globalization’, International Sociology, 21, 522–50. Quemin, Alain (2008), ‘International Contemporary Art Fairs and Galleries: An Exclusive Overview’, in The Contemporary Art Market. Annual Report, Paris: Artprice. Santagata, Walter (1995), ‘Institutional Anomalies in the Contemporary Art Market’, Journal of Cultural Economics, 19, 187–97. Schulze, Günther G (1999), ‘International Trade in Art’, Journal of Cultural Economics, 23, 109–36. Velthuis, Olav (2005), Talking Prices. Symbolic Meanings of Prices on the Market for Contemporary Art, Princeton, NJ: Princeton University Press. Watson, Peter (1992), From Manet to Manhattan, New York: Random House. Worthington, Andrew C. and Helen Higgs (2004), ‘Art as an Investment: Risk, Return and Portfolio Diversification in Major Painting Markets’, Accounting and Finance, 44 (2), 257–72.

Further reading For studies of art as an investment, see e.g. Baumol (1986), Frey and Eichenberger (1995), Ginsburgh (2003), Worthington and Higgs (2004), Goetzmann (1993), Buelens and Ginsburgh (1993), Pesando and Shum (1996), Candela and Scorcu (2001). On the relationship between the primary and the secondary market, see Hutter et al. (2007). For historical studies, see North (1992), Montias (1987), De Marchi and Van Miegroet (1994), Watson (1992). For sociological studies and anthropological studies of art markets, see Moulin (1967), Bystryn (1978), Plattner (1996), Velthuis (2005). For globalization of art markets, see Quemin (2006, 2008), Schulze (1999).

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