News

LSF professor makes headlines in the art-finance world

  • Faculté de Droit, d'Économie et de Finance (FDEF)
    16 mai 2018
  • Catégorie
    Recherche
  • Thème
    Finance

An analysis of art auction prices and a model for a democratization of the art market, both authored by Prof. Roman Kräussl at the Luxembourg School of Finance (LSF), have made headlines around the world.

An annual index of auction prices achieved in the global art market, compiled by Prof. Kräussl for  leading German business publication manager magazin, found that there was not a single woman among the 50 top-selling artists of 2017.

The highest-rank female artist was abstract expressionist Joan Mitchell in place 51 (with sales of 31 million US dollars). She was joined by only one other woman, Agnes Martin, in the top 100 artists, achieving combined sales of 27 million US dollars. These numbers pale in comparison to the top three artists in the index: Leonardo Da Vinci (450 million USD), Pablo Picasso (415 million USD) and Jean-Michel Basquiat (335 million USD).

While the absence of women can in part be explained by female artists gaining entry to prestigious art academies relatively recently. However, another study carried out by Prof. Roman Kräussl together with three co-authors, provided empirical evidence of works of art selling for less simply because they were made by women.

This additional proof for gender discrimination in the art market was delivered by an analysis of 1.5 million auction records from 45 countries, including 62,442 individual artists, between 1970 and 2013. Despite there being no credible scientific evidence to support that artworks by women are inferior to those by men, the analysis of these records shows a mean transaction price of 48,212 USD for male artists but only 25,262 USD for female artists.

Democratising the art market

While women’s artworks may not yet fetch record prices, female artists could benefit from a model developed by Prof. Kräussl and Amy Whitaker, an assistant professor at New York University.

The researchers analysed what would have happened if two top-selling artists, Jasper Johns and Robert Rauschenberg, had retained 10 percent equity in ten of their works each. While Rauschenberg’s “Thaw”, for example, sold for only 900 USD in 1958, this price exploded to 85,000 USD 15 years later. The artist, however, did not benefit from the second and subsequent sales.

“Blockchain technology could help artists keep track of the sales of the artwork. Like musicians who are paid every time their song is streamed, the model we developed would help artists keep a stake in the piece they produced,” explained Prof. Roman Kräussl.

The model could be of particular interest to emerging artists, whether male or female. While their works may not now sell for much, who can tell what the future might bring for these talents?

One drawback to the model? While it has been widely discussed in specialised publications, galleries and buyers control the market. Their interest in sharing profits with the originator of the work might be limited, according to Prof. Kräussl.

For an overview of press coverage related to Prof. Kräussl’s papers on the art market and other LSF research, visit LSF in the press.