With record-breaking auction results making headlines and expanding business models for investing in and financing artworks, fine art is increasingly marketed, collected and valued as a financial asset. This introductory course will explore the various financial positions one can take in today’s art market, including direct purchases, art funds and art exchanges, as well as such complementary businesses as art lending and the creation of private foundations. Assumptions that support the hype around art as an alternative asset will be scrutinized. Students will be asked to consider ethical implications deriving from the “financialization” of art and to develop their own world-view and moral compass on the relationship between art and finance. These considerations will also inform discussions about art investment (especially speculative), as well as current and future regulation of the art market. Basic art and financial market tools and vocabulary will be provided to students, so they will be able to compare differing expert positions and review market data to formulate their own opinions.
By the end of this course students will…
- Be able to map the important players and structures of the art market and describe the primary art-backed financial services (including examples of their providers).
- Understand the difference between “price” and “value” and how value is created (or lost) for a work of art.
- Become knowledgeable about arguments in favor of investing in art for a “diversified portfolio” and the flaws inherent in art indices.
- Grasp the economic debates about fine art's performance as a financial asset and about the art market as a whole.