We’ve written a few times about what we call reverse incentives: comedian and activist Dick Gregory‘s use of the N word; Planned Parenthood turning abortion protestors into a fund-raising scheme; and the “pledge-a-picket” drive.
The latest instance comes from fashion designer Marc Jacobs. It began when the graffiti artist Kidult vandalized Jacobs’s SoHo shop by scrawling “ART” across the storefront. A Twitter war followed, but Jacobs wasn’t done. As The New York Observer reports: Read More »
A sign on the wall at an exhibit of René Magritte paintings noted, “Magritte repeatedly painted variants of his subjects, mostly to satisfy demand in the art market.” Even artists are selling their products, just as businesses do. When the demand for their product increases, it calls forth a supply. We also see this in popular literature, where a highly successful mystery writer winds up in a rut writing minor variations of an earlier hit. Sadly for us economists, this doesn’t seem as easy to do—the premium is on originality and novelty; if today’s demand called forth minor repetitions in what we supply, we soon wouldn’t get the stuff published very well!
A reader named Matt Radcliffe writes:
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I’ve been working on a project concerning musical theater performance. I have a hypothesis which seems intuitive enough to me — that a lack of exposure to creative arts can lead to disastrous results for individuals (lack of education, poverty, etc).
I can find a plethora of research that proves the opposite (exposure to creative arts can lead to success), but I can’t find anything towards my hypothesis.
Lucas Cranach the Elder’s painting The Unequal Couple (Old Man in Love) illustrates exchange in the marriage market. An unusually looks-challenged old man, holding a gorgeous necklace, embraces a beautiful young woman, who seems pleased with the arrangement.
Nearly 500 years ago, Cranach recognized that in the marriage market men typically exchange their earning ability for a woman’s looks and reproductive ability. That is probably less true today than in Cranach’s time (early 16thcentury), but the evidence shows it is still partly valid.
In America, it’s sometime said, all big trends start in California. That’s true for great things like hot tubs, the iPod, and Pinkberry. It’s also true for bad things, like tax revolts, Pinkberry, and . . . artist resale royalties.
Artist resale royalties? In a previous post, we explained how California’s law guaranteeing artists 5 percent of the profits from any later sale of their artwork has some unintended consequences. The California law helps the tiny fraction of artists fortunate enough to have their work appreciate significantly in value. But it does nothing for the 99% of artists whose work has little enduring commercial value. Not only does it not help them, it probably hurts them. Read More »
A photograph of a river, some grass, and sky was auctioned at Christie’s in New York last week for a record-setting $4,338,500 to an unknown buyer. “Rhein II,” created in 1999 by German artist Andreas Gursky, beat out Cindy Sherman‘s previous photo auction record of $3.89 million in May, 2011.
We can’t repost an image of it, copyright and what not; though you can see it in the link above. But “Rhein II” measures 6 feet by 11 feet. The picture is one in a series of six photographs – the other five live in museums around the world, including the Museum of Modern Art and the Tate Modern. Read More »
How is California more like Europe than the United States? We can think of a few ways, but one of the most interesting involves the rights of artists. As this recent story in the New York Times points out, in 1976 California passed a law that guarantees artists 5 percent of the profits in a later sale of their artwork. In doing so, California copied France and a number of other nations, in which such profit-sharing with artists is required by law. In the rest of the United States, by contrast, artists have no right to the profits a collector might make when they resell their artwork.
From an economic point of view, the California rule is a little strange. As we discussed in a previous post, if I sell my house and in five years it rises substantially in value (an anachronistic example these days, we recognize), I don’t get a cut of the windfall. A deal is a deal. Read More »
We inherited several art works, including a Rembrandt etching—a portrait of an old man. Is it worth anything?? An art appraiser/detective hunted down its story. The print itself is new—pulled on highest-quality paper in the 1990s from Rembrandt’s plates. Apparently no prints were made in most of the 20th century. In the 1990s the plate’s owner pulled a small number, but none since, and none planned.
The owner has a monopoly on the plate and understands revenue maximization (there are essentially no variable costs): Pull just enough prints to have sufficient quantity to drive the price elasticity of demand to unity, but no more than that. Not only does his strategy gain him the most revenue, but it keeps the price of our print up in case we decide to sell it. This is a rare case where I benefit from monopoly!