Art is an aspirational “trophy” product
Are these works worth these crazy prices?
It’s hard to say. Art isn’t like a stock or bond, with a calculable value. Each piece is simply worth what you can persuade someone else to pay for it. And that depends on fashion, the availability of cash, and how many people turn up at auction. Like a Gucci bag or a professional sports franchise, art is an aspirational “trophy” product—the super-rich compete fiercely for what they call “wall power” for their homes and offices. Many traditionalists, such as veteran New York art dealer Richard Feigen, would argue that works by the likes of Koons and Damien Hirst “have no place in the history of art.” He complains that their value is dictated by the “mafia” of the art world—dealers and curators who lead the gullible rich into paying absurd prices. Even so, contemporary art is often a profitable investment. Advertising mogul Charles Saatchi bought Hirst’s embalmed shark for $98,925 in 1991 and sold it in 2005 for more than $12 million. Still, it’s a risky business: A glance at the catalogues from 10 years ago shows that around half of the contemporary artists in them are no longer sold at top auctions.
