Price Versus Values: Why Primary-Market Opacity Makes Museum Collections Less Diverse

This week, linking freedom of information to freedom of expression…

MINORITY REPORT 

On Thursday, my colleague Julia Halperin and Charlotte Burns of In Other Words, Art Agency, Partners’ newsletter and podcast, published a multi-part special report titled "Women’s Place in the Art World." The project combines rigorous reporting with quantitative analysis of acquisitions and exhibition data from 26 American museums between 2008 and 2018. The headline finding is valuable precisely because it’s so startling: Despite a flotilla of rhetoric about the importance of correcting decades of extreme gender bias in art institutions, only a measly 11 percent of works bought by, or donated to, the museums in this sample in the past decade were by artists identifying as women.

The main report in the series (linked above) gives roughly equal coverage to the jarring facts of this situation and the reasons those facts exist. The latter entails both legitimate issues and bogus excuses thrown up as a would-be smokescreen against criticism for such disappointing progress. And while there is a lot (and I mean a lot) buried in the vapors that deserves further investigation, I want to focus on one target that has both quantitative and qualitative implications. 

The section in question concerns a frequent tension between curators, who are responsible for recommending works for acquisition, and the committees who decide whether to accept or reject those recommendations. Halperin and Burns write:

Curators say they struggle to convince their acquisition committees to pay up for work, particularly by older, overlooked female artists, who frequently lack an auction history that might be used to validate the asking price. “It can be difficult to defend the value of the work,” says Connie Butler, the Hammer Museum’s chief curator. “There is this weird disconnect that even while people are happy to support a show, the lack of auction records for female artists is a problem when you’re trying to support acquisitions.”

This Catch-22 can lead to infuriating outcomes for proponents of gender diversity:

One curator described a meeting in which she pitched the work of an elderly female artist whose exhibition the museum had recently staged to great success. The committee decided against it, feeling that there were not enough market comparables. Instead, they bought a work by a “hot” young male artist. 

This is a textbook example of how a narrow viewpoint and blind devotion to procedure can lead you to bad ends. It's the permanent-collection equivalent of following a navigation app’s directions deeper and deeper into a known wildfire just because you know for certain the route happens to be free of traffic. (No, this is not just an ironic thought experiment.) 

But there’s a larger point to be made here than the eternal face-palm trigger that is human nature.

THE GHOST OF PRICE TRANSPARENCY

What enables the maddening resistance in Connie Butler’s anecdote is, once again, that auction results comprise the only reliable, comprehensive, and easily searchable data on art sales. (Remember, art-fair sales reports are rife with opportunities for distortion, and while the amount of information available via online-sales platforms is growing, it still has yet to be centralized in a user-friendly way.) This fact means individual and institutional buyers consistently overrate auction results' applicability to private sales, particularly those on the primary market. Which creates a colossal market inefficiency, since prices on the private/dealer market and the public/auction market can, and often do, substantially deviate from one another. 

Would widely available primary-market sales data completely eliminate the problem? Probably not. Certainly, there are cases where a historically-important-yet-historically-ignored artist lacks a strong record of primary sales, too. Some may not even have had gallery representation for much of their careers. 

But there are many others who managed to sell just enough new works through various dealers to scrape by for years, even decades. Supply and demand simply never reached a level that warranted the development of an auction market for their output. Without a repository of those private transaction records, then, it’s dramatically easier for potential buyers to pass over an artist on the basis of unfulfillable due diligence.  

Why am I highlighting those two excerpted paragraphs from Halperin and Burns’s piece? Because they reveal a consequence of price opacity that seldom enters the debate about the damage it does or doesn’t do to art, artists, and art history.

MATCH POINT

The debate I just mentioned usually unfolds like this: Critics of greater price transparency argue that exclusivity and myth-making are necessary to infuse value into artworks, which, from a cold practical viewpoint, are objects, spectacles, or concepts that have little to no tangible use. 

Advocates of greater price transparency tend to counter this rationale by arguing that it only works as long as you’re content to keep selling to the few thousand existing initiates of contemporary art willing to abide by the trade’s idiosyncrasies and asymmetries of information. But the strategy cripples the art market’s potential to meaningfully expand its client base with a large number of new buyers, particularly younger ones and tech-sector leaders accustomed to devouring data at every opportunity—and, as a result, trained to detest anyone and any scenario that thwarts their ingrained hunger for information.    

But the savviest defenders of price opacity have a counter-punch to this move, too. They fire back that greater transparency would corrode one of the only firewalls that makes art a unique, exalted space. Widely publicizing asking prices, let alone sales results, from the primary market would drag the transcendent ideals of contemporary art into the same grubby bog of transactionalism as grocery stores, used-car dealerships, and your local Walmart. By winning many more customers—and the loaded term “customers” is truer to this argument than the refined rubric “collectors”—art loses something much more important: its soul. 

The excerpt from Halperin and Burns’s report emerges as the next rebuttal in this back-and-forth. It shows that price opacity doesn’t just affect the size of the art market or the amount of revenue it generates. It also affects the makeup of the institutional canon and the effectiveness of attempts to roll back long-standing preferential treatment of a small subset of overwhelmingly male, overwhelmingly white artists. 

Whether they’re pursuing legitimate due diligence or just wielding a convenient excuse to camouflage retrograde thinking, then, members of museum acquisitions committees will be meaningfully more likely to slow-walk needed change as long as auction results are the only robust resource for price comparisons in the art market. And this imbalance of information isn’t just a blow to dealers’ and artists’ bank accounts. It’s a blow to the visitor experience, art history, and the culture at large. 

[artnet News x In Other Words]

That’s all for this week. ‘Til next time, remember what Thom Yorke once sang: just ‘cause you feel it doesn’t mean it’s there.