In a recent interview with art market expert Magnus Resch, the challenges and dynamics of the art market were brought to the forefront. Resch, a lecturer in management and seasoned entrepreneur, sheds light on the existing opacity within the art world and proposes solutions to transform its economics.
Resch points out a significant disparity in the art market, where the top 0.1% of high-end artworks see substantial increases in prices, while the majority of artists experience declining sales. This dichotomy, according to Resch, creates two distinct art worlds.
While art at the highest tier can be a good investment, Resch advises against purchasing art solely for financial gain. Responsible buying, he argues, involves supporting artists, communities, and galleries because of a genuine appreciation for the art.
Resch’s research, published in Science, emphasizes the critical role played by a select network of galleries and museums in determining an artist’s success. Failing to integrate into this network early in an artist’s career significantly diminishes the likelihood of financial success.
According to Resch, the economic value of art is heavily influenced by decisions made by a small group of galleries and museums showcasing a particular artist. This concentration of power shapes the perceived worth and significance of artists within the art world.
Resch believes that the art market has the potential to triple in size by tapping into a new group of buyers who attend art events but haven’t yet made purchases. He suggests resolving barriers that prevent rookie buyers from making art purchases, unlocking substantial potential among aspiring art buyers.
Resch teaches a unique class at Yale that brings together MBA and MFA students. The class aims to educate a new generation of collectors and artists, providing theoretical knowledge, insights from art world experts, and opportunities for networking.
Resch predicts a power shift to artists over the next 15 to 20 years, with NFTs becoming a standard technology in the art market. Contrary to the misconception that NFTs are only for digital art, Resch sees them as a technology that establishes clear provenance, reduces the need for intermediaries, and provides royalties for artists.
While acknowledging the challenges artists face in making a living, Resch emphasizes the need for artists to embrace entrepreneurship and acquire essential business skills. Responsible buying, he argues, involves supporting underrepresented artists from marginalized communities.
Resch expresses optimism about a transformation in the primary art market, welcoming a larger audience driven by a desire for emotional value and support for artists, communities, and galleries. As the art market evolves, responsible collectors may play a crucial role in shaping its future.
Magnus Resch’s insights shine a light on the intricacies of the art market and propose transformative measures to enhance transparency and inclusivity. As the art world continues to evolve, these perspectives provide valuable guidance for artists, collectors, and enthusiasts alike.
