How Damien Hirst recaptured his market

By Felix Salmon
March 27, 2012

It should come as no surprise that the Damien Hirst retrospective at Tate Modern has caused editors across the UK to run articles about what it might mean for the Hirst market. After all, Hirst, more than any other artist, is famous in large part just because he’s expensive.

Thus do we get Sarah Thornton, in the Economist, writing that “many collectors of Mr. Hirst’s work hope that this show will reinvigorate his market”. Against that is Julian Spalding, who’s written an entire Kindle Single entitled Con Art – Why you ought to sell your Damien Hirsts while you can. And then there’s Hari Kunzru:

This isn’t just art that exists in the market, or is “about” the market. This is art that is the market – a series of gestures that are made wholly or primarily to capture and embody financial value, and only secondarily have any other function or virtue. Hirst has gone way beyond Warhol’s explorations of repetition and banality. Sooner or later, his advisers will surely find a way for him to dispense with the actual objects altogether and he will package concepts in tranches, like mortgage securities, some good stuff with some trash, to be traded on the bourse in Miami-Basel.

Kunzru starts off near the mark, here, but then veers wildly off course. What I think that all three of these writers are missing is the fact that the Damien Hirst market is largely nonexistent, and has been ever since the “Beautiful Inside My Head Forever” sale at Sotheby’s which was held the day Lehman Brothers filed for bankruptcy in 2008. Here, from Artnet, is Hirst’s annual sales volume at auction (the grey bars are all lots, the orange bars are the top ten lots):

hirst.png

What you’re seeing here is a speculative bubble in Hirst which grew right up until September 2008. After that, Hirsts became a luxury good, in many ways closer to a Prada coat or a bottle of Bordeaux than to artists with healthy secondary markets, like Gerhard Richter. For the past three and a half years, Hirsts have been something to buy, to consume: they’re no longer something that can be easily sold, let alone at a profit.

There is absolutely such a thing as the art market: a place where artworks are bought and sold, and where dealers and auction houses make money as the intermediaries finding the prices at which buyers and sellers can agree to transact. There isn’t, by contrast, such a thing as the Prada market: that’s a consumption market, where Prada makes goods, sets the prices unilaterally, and then sells them to as many people are willing to pay their price. (And given that Prada is in the Giffen Veblen goods market, often raising the price has the effect of raising the demand.)

Hirst, for better or worse, has moved himself out of the art market and into the consumption-goods market: he manufactures art works, sets the prices for them, and sells them to anybody willing to buy them. Once you have bought a Hirst, you then exhibit it as a way of displaying your wealth and, um, taste. Hirsts have not been a speculative investment since 2008, and I very much doubt the Tate retrospective is going to change that.

I don’t think this is a bad thing. Hirst, more than any other artist, has managed to capture the value of his works for himself. The global stock of Gerhard Richters is hugely valuable, and that value is at least one and possibly two orders of magnitude greater than the total amount of money that Gerhard Richter himself has made over his lifetime. The value of the art, in other words, has accrued to collectors rather than to the artist.

That’s not the case with Hirst: I suspect that of all high-profile artists, he has personally pocketed the greatest percentage of what you might call his global market capitalization. All too often, discussions of artists’ prices work on the assumption that higher prices, and higher dollar volumes, are always good for that artist. But I think Hirst has managed to disprove that rule. Collectors are not getting rich off his work. But he is.

8 comments

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Prada’s in the Veblen goods market – conspicuous consumption is different than what you see (or do you?) with Giffen goods.

Posted by absinthe | Report as abusive

There is absolutely such a thing as the art market: a place where artworks are bought and sold, and where dealers and auction houses make money as the intermediaries finding the prices at which buyers and sellers can agree to transact. There isn’t, by contrast, such a thing as the Prada market:

http://www.ebay.com/sch/i.html?_from=R40 &_trksid=p5197.m570.l1313&_nkw=prada&_sa cat=See-All-Categories

Posted by Moopheus | Report as abusive

LOL. touché, Moopheus. But I think the point that Felix was making is that the price of Prada on any secondary market, such as eBay, reflect a discount because of the fact that the items are used or being sold second-hand and thus reflect a discount because of that fact. So they are still consumption goods.

I’m totally guessing here. I wouldn’t know what a price increase or decrease over retail looks like for a Prada bag because I’ve never, ever been into a Prada retail store and don’t know what they go for new.

Posted by Strych09 | Report as abusive

two things. first, hirst’s total auction volume for 2011 appears to be at or slightly north of $25 million. i’d love to see you produce this chart for other artists, let alone living artists, to see who else sold $25 million in art in ’11. (i understand that these artnet charts are pricey, but it would give better context to your claim.) second, this chart is only about *auctions*. the whole reason ’08 shoots through the roof is because hirst sold the entire ‘beautiful inside my head forever’ exhibition through auction! but for this stunt, it would have been exhibited and sold through gagosian and the volume sold at auction would be materially smaller, much more in line with the other years on the chart. throwing in the downturn in the world economy and the art market during ’08-’11 you are really making a stretch here. feeding in to the easy obvious anti-hirst narrative rather than doing any sort of meaning research on the market.

Posted by jmb85 | Report as abusive

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