Think about Mark Rothko’s White Center. Painted in the 1950s, it's part of the abstract expressionist movement. For those who can’t get your head around abstract art, brace yourselves. White Center sold at auction for $72.84 million US in 2007 to the Qatari Royal Family, at the time setting a world record for a post-war piece of work. Now think about that, $72.84 million. You could buy a mansion, a yacht, and a private jet and still have money to spare to run all three. Instead it was used to buy this painting, some pigment in the shape of rectangles on canvas.
It’s no secret that the art world seems to value so highly what seems to have no practical purpose. Now to be clear, just because a painting may be the most expensive painting sold at auction does not mean it is the best painting in the world. The price at auction results from a competition between two people who desire to own the painting. Now the question is: why? What pushes these multi-millionaires to hand over insane figures for ownership of a single painting?
Take White Center. What pulled the Qatari royal family to the painting was likely not the painting itself or even who painted it, a common factor when determining painting value. What mattered to the royal family was the painting’s provenance or who used to own the painting. White Center’s previous owner? The mega-rich Rockefellers.
Of course there are some billionaires that simply want to show off that they have the wealth to be able to afford “expensive artists” like Picasso or Warhol. In economics this is called signalling: indirectly telling people something. However, this may not be the case in many auction purchases. Often buyers prefer to remain anonymous and many of the most expensive paintings are never see again. If the mega rich aim only to show their wealth through the art they purchase, why would they choose to remain very private? We can conclude that these intensely private individuals are so rich that they simply don’t care enough to prove it to the public but rather keep the flaunting within their own super-rich community. Perhaps they simply buy the expensive paintings because they are already surrounded by exorbitant luxuries, why stop with the art they acquire?
This leads to an unsettling truth. Many great paintings are kept away in the private sitting rooms of the wealthiest in the world. Here, paintings are private goods, bought and sold like some iPad on ebay, only to be used by the buyer. However, art can function like a public good, a good that many can enjoy simultaneously if the work of art was exhibited in a museum. On the whole, more people benefit from the work of art should it live in a museum as opposed to the hallway of an affluent businessman who may not even really appreciate the piece. Some buyers lend out paintings in their collection to galleries, but only if they feel like it. Isn’t it rather unfair that our access of some great works of art depends on the impulses of the multi-millionaires of the world? Welcome to capitalism my friend.