artist’s death. We found that 10 years after their death, 37.5%of artists had no artworks sold, increasing to 45.5% after 20 years. But this was not always the case, and investigating trading patterns and the networks artists had at the times of their deaths, led us to several factors that were at play in determining if prices went up or down. DON’T KEEP IT IN THE FAMILY Firstly, artists' families would often sell-off works following an artist's death. Before death, only 0.7%of an artist's works were sold under their last name, and this went up to 13% after death. Families tend to sell the most expensive artworks first, but generally the works sold for much less than other artworks by the same artist, suggesting both the poor quality of the works and a lack of strategic planning on the part of the seller. Artists can often strategically withhold works from the market, but their families – acting without the benefit of professional consultation and selling directly at auction – can liquidate assets in an estate sale, with no overall plan or long-term strategy. Prices for these works are on average 48%of those sold by others, and the effect on market is strong within the first two years of the artist’s death, when 55%of all family sales occur. IT’S NOTWHAT YOU KNOW, IT’SWHO YOU KNOW These sales have an effect in that immediate period, but in the long-term, it is the composition of the pool of buyers that shapes the prices. Those from artists whose works rise in value are more often bought by emerging art dealers, but they are among a select few, with most artists not having built a significant trading network through auctions prior to their death, thus decreasing the chance for a postmortem popularity increase. These influences on prices still resonate centuries later. While Turner went on to be regarded as the preeminent landscape painter of the age, McCulloch, if still respected in his own right, enjoys neither his contemporary’s fame nor favour when it comes to his works selling at auction. Turner’s 1835 work Rome (fromMount Aventine) sold for $47.6mat Sotheby’s in 2014 – the highest price for any British-born artist at auction – while the average price for a McCulloch in recent years is $25,800. This pattern can be traced to the period soon after their deaths. While dealers bought 77%of Turner’s paintings in the 20 years after his death – with the most prominent dealer of the period, Thomas Agnew, buying 28%of those sold – they purchased only 42%of McCulloch’s works. As for prices, Turner’s paintings appreciated by 122%, but McCulloch’s sale prices fell by an average of 32%. The divergence started in the mid-19th century and continues to this day. The prices of the two artists' works after their deaths seems to have been influenced by the network of auction houses connected to them at the time. Their purchasing of Turner’s work elevated his reputation and sales price over time, while the audience for McCulloch’s work carried no such influence, and the dealers formed no such network as that around the Turner paintings. REPUTATION COUNTS In life as in death, the demand for artworks depends crucially on an artist’s reputation. In the primary market for art, this is managed by gallerists and dealers, and a handful of galleries, collectors and museums have the power to determine what is good and valuable. Those artists with strong networks at the time of their death continue to see these networks buying and selling their works 20 years later, and for higher prices. The strategic planning of sales following an artist’s death can have a significant impact on prices in the short and long-term. Having access to art professionals before an artist’s death has a major effect on the trajectory of their most highly-priced works. A dealer can strategically drive demand through their networks and by planning sales following an artist’s death; when it is left to the family to deal with such matters, strategy is often lacking and value goes down. The art you like may be down to individual taste, but even centuries later, the art that costs most and has a greater reputation depends greatly on who was left behind to sell the works when the artist died. Professor Dakshina De Silva works in the Department of Economics, specialising in Industrial Organisation, Environmental and Natural Resource Economics, Regional and Urban Economics, and Applied Microeconomics. The paper, Posthumous Trading Patterns Affecting Artwork Prices, is co-authored with Professor Georgia Kosmopolou, of the University of Oklahoma, Professor Rachel Pownall, of Maastricht University, and Dr Robert Press, of the University of Oklahoma. It is published in Oxford Economic Papers. d.desilva@lancaster.ac.uk FIFTY FOUR DEGREES | 17 Most of you reading this piece will be familiar with the works of JMWTurner. Turner’s works such as The Fighting Temeraire, The Slave Ship and Hannibal Crossing the Alps are admired around the globe. His art is displayed in some of the world’s foremost galleries, sold for millions at only the finest auction houses, and often seen as a cultural touchstone for 19th century Great Britain. So, the chances are you hav, at the very least heard of Turner, if not seen and appreciated his work, but what about HoratioMcCulloch? While Turner is famous the world over, the Scotsman has not enjoyed the same lofty reputation, despite in his lifetime being greatly admired for his paintings of Scotland. While his landscapes can be found in the National Gallery of Scotland, and his talent cannot be denied, to most in the 21st century, he is a lesser-known – if not unknown – figure. Yet when they were alive in the 19th century, Turner and McCulloch saw similar levels of success when it came to selling their paintings. It was only following their deaths that their popularity diverged – the works of one regularly selling for millions, the other for a fraction of that. Why so?What factors contributed to the fluctuations in prices the works of these twomen experienced after their deaths? Does the art market generally value the fact an artist is alive, and can potentially producemore work, or is being alive an impediment to posthumous market success once they have reached – and passed – their peak? Art is an investment, and previous research has shown how artworks increase in price following the death of the artists – Mark Twain’s short story and play Is He Dead? even tells the tale of an artist faking his own death so his work could become more valuable. But much research in this area focuses on artists who are particularly well-known, at the top of their field. To gain a more general picture, our paper studies all art auctions in London that took place between 1741 and 1913 – a near 175-year span when such respected artists as Turner, William Hogarth, Thomas Gainsborough and John Constable lived and died. From sales of almost 8,000 artworks from 160 artists, contrary to those previous studies – and Mark Twain’s dramatics – it is shown that prices declined by an average of seven per cent in the 20 years following the 16 |
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