Jul 30th 2015

Pricing Genius

by David W. Galenson

Dr. David W. Galenson is Professor of Economics at the University of Chicago; Academic Director of the Center for Creativity Economics at Universidad del CEMA, Buenos Aires; and a Research Associate of the National Bureau of Economic Research. His publications include Old Masters and Young Geniuses: The Two Life Cycles of Artistic Creativity (Princeton University Press, 2006) and Conceptual Revolutions in Twentieth-Century Art (Cambridge University Press and NBER, 2009). David W. Galenson, picture aboce. Derek Walcott, picture in the text.

Art world sophisticates often casually dismiss the market for art as irrational and arbitrary. The critic Robert Hughes memorably declared in 1978 that "The price of a work of art is an index of pure, irrational desire." More recently, in 2006, Sotheby's Tobias Meyer told the New York Times that auction prices could only be described as "magical." These experts often reject any measurement: in 1998 the scholar Robert Storr declared that artistic success "is completely unquantifiable." And anybody who claimed otherwise was dishonest: that same year the Guggenheim's Robert Rosenblum told the Wall Street Journal, "I immediately distrust anybody trying to detect patterns...in art, especially in terms of economics."

The experts are wrong.

Simone Lenzu and I have recently analyzed all auction records of sales of paintings by Jackson Pollock and Andy Warhol during 1965-2015 - a total of 160 paintings by Pollock, and a whopping 2,870 by Warhol. Regression analysis of these data indicate that Pollock's most expensive works were produced during 1948-50, when he was 36-38 years old, and that Warhol produced his most expensive works in 1962-63, when he was 34-35.

We compared these estimated peak ages to the evaluations of the artists' careers by experts, in two different ways.

First, taking all available textbooks of art history published in English since 1990 - of which we found a total of 61 - we distributed all the illustrations of the two artists' work by the date of those works' execution. The single year from which Pollock's work is most often illustrated in the books is age 38, while that of Warhol is 34.

Second, we distributed by the artist's age at execution all the works included in the two artists' most recent retrospective exhibitions - Pollock's at New York's Museum of Modern Art in 1998-99, Warhol's at Berlin's Neue Nationalgalerie and London's Tate Modern in 2001-02. The single year represented by the largest number of works in the Pollock retrospective was age 36, while that for Warhol was age 34.

The striking agreement of these three very different sources clearly demonstrates that there are strong patterns in art. The auction market places Jackson Pollock's peak at 36-38, textbook illustrations place it at 38, and his latest retrospective places it at 36. Andy Warhol's most expensive paintings were done at ages 34-35; textbook illustrations place his peak at 34, and his latest retrospective does the same.

If you think these results are not random, you're right. There is a consensus among art scholars that Jackson Pollock produced his greatest art during 1948-50, when he was at the height of his mastery of the drip technique. There is equally a consensus that Andy Warhol made his greatest contributions in 1962, when he first used mechanical techniques to make visual images from photographs.


Autumn Rhythn (1950), Jackson Pollock's most frequently illustrated painting.
Image courtesy Metropolitan Museum of Art, New York

Experimental innovators work by trial and error toward imprecise esthetic goals. Jackson Pollock spent nearly two decades working toward a new way of making the large paintings that he believed were the future of art. At 35, he arrived at his novel drip technique, and spent several more years developing it before he produced the monumental masterpieces for which he is celebrated today. In contrast, conceptual innovators arrive suddenly at novel ways of expressing specific ideas. Andy Warhol decided to become a painter only after he spent a decade as a successful commercial illustrator. Within barely two years of his decision, he was making photographs into paintings using mechanical printing techniques. These early paintings, which would influence generations of young artists, were the most important ones he would ever make.


2015-07-29-1438195880-8986368-Warholmarilyndiptych1962.jpg
Marilyn Diptych (1962), Andy Warhol's most frequently illustrated painting.
Image courtesy of the Tate Modern, London.

Great artists are innovators; great works of art are those that embody their innovations. Age-price profiles estimated from auction sales agree closely with the judgments of art scholars as to when the two greatest artists born in the 20th century made their greatest contributions. Contrary to the claims of art experts, art markets are not irrational. As James Stewart recently put it, art markets allow collectors to invest in genius, and collectors do so systematically: the most innovative works of the most innovative artists bring the highest prices.



Related article:

Which paintings were the most creative of their time? An algorithm may hold the answers

by Ahmed ElgammalAdded 31.07.2015
From Picasso’s The Young Ladies of Avignon to Munch’s The Scream, what was it about these paintings that arrested people’s attention upon viewing them, that cemented them in the canon of art history as iconic works? In many cases, it’s because...


To follow what's new on Facts & Arts,
 please click here.


For links to Amazon for David Galenson's books, please click picture below.




     

Browse articles by author

More Essays

Apr 13th 2021
EXTRACT: "Overall, our review has found that there isn’t evidence to back up the claims that veganism is good for your heart. But that is partly because there are few studies ....... But veganism may have other health benefits. Vegans have been found to have a healthier weight and lower blood glucose levels than those who consume meat and dairy. They are also less likely to develop cancer, high blood pressure and diabetes. "
Apr 8th 2021
EXTRACT: "Pollock’s universe, the universe of Mural, cannot be said to be a rational universe. Nor is it simply devoid of all sense. It is not a purely imaginary world, although in it everything is in a constant state of flux. Mural invokes one of the oldest questions of philosophy, a question going back to the Pre-Socratic philosophers Parmenides and Heraclitus – namely, whether the nature of Reality constitutes unchanging permanence or constant movement and flux. For Pollock, the only thing that is truly unchanging is change itself. The only certainty is that all is uncertain."
Apr 8th 2021
EXTRACT: "Many present day politicians appear to have psychopathic and narcissistic traits too. It’s easy to spot such leaders, because they are always authoritarian, following hardline policies. They try to subvert democracy, to reduce the freedom of the press and clamp down on dissent. They are obsessed with national prestige, and often persecute minority groups. And they are always corrupt and lacking in moral principles."
Apr 6th 2021
EXTRACT: "This has led some to claim that not just half, but perhaps nearly all advertising money is wasted, at least online. There are similar results outside of commerce. One review of field experiments in political campaigning argued “the best estimate of the effects of campaign contact and advertising on Americans’ candidates choices in general elections is zero”. Zero!"
Mar 30th 2021
EXTRACT: "The Father is an extraordinary film, from Florian Zeller’s 2012 play entitled Le Père and directed by Zeller. I’m here to tell you why it is a ‘must see’." EDITOR'S NOTE: The official trailer is attached to the review.
Mar 28th 2021
EXTRACT: "Picasso was 26 in 1907, when he completed the Demoiselles; de Kooning was 48 in 1952, when he finished Woman I.  The difference in their ages was not an accident, for studies of hundreds of painters have revealed a striking regularity - the conceptual painters who preconceive their paintings, from Raphael to Warhol, consistently make their greatest contributions earlier in their careers than experimental painters, from Rembrandt to Pollock, who paint directly, without preparatory studies."
Mar 26th 2021
EXTRACT: "Mental toughness levels are influenced by many different factors. While genetics are partly responsible, a person’s environment is also relevant. For example, both positive experiences while you’re young and mental toughness training programmes have been found to make people mentally tougher."
Mar 20th 2021

The city of Homs has been ravaged by war, leaving millions of people homeless an

Mar 20th 2021
EXTRACT: "There are two main rival models of ethics: one is based on rights, the other on duties. The rights-based model, which traces its philosophical origins to the work of John Locke in the 17th century, starts from the assumption that individuals have rights ....... According to this approach, duties are related to rights, but only in a subordinate role. My right to health implies a duty on my country to provide some healthcare services, to the best of its abilities. This is arguably the dominant interpretation when philosophers talk about rights, including human rights." ........ "Your right to get sick, or to risk getting sick, could imply a duty on others to look after you during your illness." ..... "The pre-eminence of rights in our moral compass has vindicated unacceptable levels of selfishness. It is imperative to undertake a fundamental duty not to get sick, and to do everything in our means to avoid causing others to get sick. Morally speaking, duties should come first and should not be subordinated to rights." ..... "Putting duties before rights is not a new, revolutionary idea. In fact it is one of the oldest rules in the book of ethics. Primum non nocere, or first do no harm, is the core principle in the Hippocratic Oath historically taken by doctors, widely attributed to the ancient Greek philosopher and physician Hippocrates. It is also a fundamental principle in the moral philosophy of the Roman statesman Marcus Tullius Cicero, who in De Officiis (On Duties) argues that the first task of justice is to prevent men and women from causing harm to others."
Mar 18th 2021
EXTRACT: "Several studies have recently compared the difference between antibodies produced straight after a coronavirus infection and those that can be detected six months later. The findings have been both impressive and reassuring. Although there are fewer coronavirus-specific antibodies detectable in the blood six months after infection, the antibodies that remain have undergone significant changes. …….. the “mature” antibodies were better at recognising the variants."
Mar 15th 2021
EXTRACT: "Like Shakespeare, Goya sees evil as something existing in itself – indeed, the horror of evil arises precisely from its excess. It overflows and refuses to be contained by or integrated into our categories of reason or comprehension. By its very nature, evil refuses to remain within prescribed bounds – to remain fixed, say, within an economy where evil is counterbalanced by good. Evil is always excess of evil." ....... "Nowhere is this more evident than in war. Goya offers us a profound and sustained meditation on the nature of war ........ The image of a Napoleonic soldier gazing indifferently on a man who has been summarily hanged, probably by his own belt, expresses the tragedy of war – its dehumanization of both war’s victims and victors."
Mar 14th 2021
EXTRACT: "A blockchain company has bought a piece of Banksy artwork and burnt it. But instead of destroying the value of the art, they claim to have made it more valuable, because it was sold as a piece of blockchain art. The company behind the stunt, called Injective Protocol, bought the screen print from a New York gallery. They then live-streamed its burning on the Twitter account BurntBanksy. But why would anyone buy a piece of art just to burn it? Understanding the answer requires us to delve into the tricky world of blockchain or “NFT” art."
Mar 14th 2021
EXTRACT: "Exercise is good for your health at every age – and you can reap the benefits no matter how late in life you start. But our latest research has shown another benefit of being physically active throughout life. We found that in the US, people who were more physically active as teenagers and throughout adulthood had lower healthcare costs."
Mar 10th 2021
EXTRACT: "Although around one in 14 people over 65 have Alzheimer’s disease, there’s still no cure, and no way to prevent the disease from progressing. But a recent study may bring us one step closer to preventing Alzheimer’s. The trial, which was conducted on animals, has found a specific molecule can prevent the buildup of a toxic protein known to cause Alzheimer’s in the brain."
Feb 24th 2021
EXTRACT: "The art historian George Kubler observed that scholars in the humanities “pretend to despise measurement because of its ‘scientific’ nature.” As if to illustrate his point Robert Storr, former dean of Yale’s School of Art, declared that artistic success is “completely unquantifiable.” In fact, however, artistic success can be quantified, in several ways. One of these is based on the analysis of texts produced by art scholars, and this measure can give us a systematic understanding of how changes in recent art have produced changes in the canon of art history."
Feb 24th 2021
EXTRACT: "The most politically sensitive option we looked at was the virus escaping from a laboratory. We concluded this was extremely unlikely."
Feb 16th 2021
EXTRACT: ".... these men were completely unaware that they had put their lives in the hands of doctors who not only had no intention of healing them but were committed to observing them until the final autopsy – since it was believed that an autopsy alone could scientifically confirm the study’s findings. As one researcher wrote in a 1933 letter to a colleague, “As I see, we have no further interest in these patients until they die.” ...... The unquestionable ethical failure of Tuskegee is one with which we must grapple, and of which we must never lose sight, lest we allow such moral disasters to repeat themselves. "
Feb 14th 2021
EXTRACT: "In 2010 Carlos Rodriguez, the president of Buenos Aires' Universidad del CEMA, created the world's first - and only - Center for Creativity Economics.  During the next ten years, the CCE presented a number of short courses and seminars.  But the most important of its events was an annual lecture by an Argentine artist, who was given a Creative Career Award."
Feb 11th 2021
EXTRACT: "It’s not hard to see why. Although AI systems outperform humans in tasks that are often associated with a “high level of intelligence” (playing chess, Go, or Jeopardy), they are nowhere close to excelling at tasks that humans can master with little to no training (such as understanding jokes). What we call “common sense” is actually a massive base of tacit knowledge – the cumulative effect of experiencing the world and learning about it since childhood. Coding common-sense knowledge and feeding it into AI systems is an unresolved challenge. Although AI will continue to solve some difficult problems, it is a long way from performing many tasks that children undertake as a matter of course."
Feb 7th 2021
EXTRACT: "When it comes to being fit and healthy, we’re often reminded to aim to walk 10,000 steps per day. This can be a frustrating target to achieve, especially when we’re busy with work and other commitments. Most of us know by now that 10,000 steps is recommended everywhere as a target to achieve – and yet where did this number actually come from?"