Brandeis University Prof. Nancy Scott (scott@brandeis.edu)
ECON/ FA 87 Syllabus Spring 2016 Prof. Kathryn Graddy (graddy@brandeis.edu)
TA: Sarah Horn (shorn@brandeis.edu)
Economics and the Arts
OVERVIEW
Economics inevitably enters into many aspects of the arts, from the mechanics of the purchase and sale of works of art, to the investment returns to holding art, and to taxation of the arts. Art history studies the place of the artist and artwork in a matrix of social, political and stylistic factors. The purpose of this course is to provide students with an understanding of how the history and patronage of specific artists and works of art intersects with the marketplace.
LEARNING GOALS
You will learn how works of art come to the market, how the art marketplace can affect the price of art, and to gain a broad understanding of some factors that affect the labor supply of artists.
You will learn about the formation of art collections, the responsibility of galleries and museums to hold, curate and deaccession works of art in accordance with stated ethical standards.
Assignments will gauge and strengthen the ability to research and analyze works of art, set in an economic and cultural context.
PRE-REQUISITES
Econ 2a AND one of the following art history survey courses: FA30a, FA30b, FA57a, FA59a and FA62a should be taken either simultaneously with this course or prior to the start of the course.
COURSE REQUIREMENTS
Course material will be covered through assigned readings, lectures and class discussion.
There will be an in class mid-term examination and a final examination along with a 10 page paper on a topic at the intersection of arts and economics that has arisen from the course material or discussion. All students will present brief oral reports based on their papers in class or at a specially arranged meeting. Success in this four- credit course is based on the expectation that students will spend a minimum of 9 hours of study time per week in preparation for class (readings, papers, discussion sections, preparation for exams, etc.).
Course grades will be determined by performance on the midterm (25%), the paper and class presentation (25%), the final (30%), class participation (5%), and homework/ reading responses
(15%). You cannot receive a grade in the course if you have failed to turn in all required work.
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The paper and class presentation will be done with a partner on a topic that it mutually agreed upon. Please see the document “Term Paper Guidelines” for more information.
The homework consists of submitting questions or responses that you have to the assigned readings. These should consist of at least one paragraph or about 3 or 4 bullet points. The purpose of these assignments is to get you to engage with and think about the assigned readings before class so that you can fully participate in class. Our TA will collate these responses before class and we will address any questions or insights during the class. These will be due by Saturday night (at 11:55 pm) for Monday’s class and by Monday night (at 11:55 pm) for Wednesday’s class. There will be readings for most classes; for full course credit, you will be allowed at most two late submissions. The responses will be submitted through latte.
ACADEMIC INTEGRITY
You are expected to be familiar with and to follow the University’s policies on academic integrity
( http://www.brandeis.edu/studentlife/sdc/ai/ ). Instances of alleged dishonesty will be forwarded to the Office of Campus Life for possible referral to the Student Judiciary System. Sanctions may include failure in the course and suspension from Brandeis. If you have any questions about expectations, please ask.
READING ASSIGNMENTS
The exact reading assignments are given below in the course outline. Some of these assignments are taken from the books listed below; others are from journals. Reading materials do not need to be purchased for this course, as required readings will be posted on latte. Additional optional readings are also posted on latte.
The following is a suggested bibliography for additional optional reading.
Brewer, John. The American Leonardo: A Tale of Obsession, Art and Money (Oxford: 2009).
FitzGerald, Michael, Making Modernism: Picasso and the Creation of the market for Twentieth
Century Art, 1995.
Hamilton, James, A Strange Business: Art, Culture and Commerce in Nineteenth-Century
London, Pegasus Books, 2015.
Horowitz, Noah, The Art of the Deal: Contemporary Art in a Global Financial Market, Princeton
University Press, 2011.
Ginsburgh, Victor A. and David Throsby, eds. Handbook on the Economics of Art and Culture ,
Elsevier Science Publishers, 2006.
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Mason, Christopher, The Art of the Steal, G.P. Putnam's Sons, 2004.
Nicholas, Lynn H., The Rape of Europa , First Vintage Books, 1994.
Rabinow, Rebecca, ed. Cezanne to Picasso : Ambroise Vollard, Patron of the Avant-Garde .
Metropolitan Museum of Art, New York: 2006.
Salisbury, Laney and Aly Sujo, Provenance: How a Con Man and a Forger Rewrote the History of Modern Art, The Penguin Press , 2009.
Thornton, Sarah, Seven Days in the Art World , W.W. Norton and Company, 2008.
Towse, Ruth, ed. A Handbook of Cultural Economics , 2e, forthcoming, 2010.
Watson, Peter, From Manet to Manhattan: the Rise of the Modern Art Market, 1992.
For background reading, relevant chapters from any Principles of Economics textbook will work.
COURSE OUTLINE AND READING LIST
Session 1: Introduction: Presentations by Professors Graddy and Scott
January 13
Session 2: The American Leonardo: How the work of art comes to the auction block.
January 20
Required Reading:
Readings: Brewer, John. The American Leonardo: A Tale of Obsession, Art and Money
(Oxford: 2009), Introduction, and ch. 2 “The Culture of Connoisseurship,” pp 42-70.
Session 3: Case Study: The 19th Century Art Market
January 25
Required Reading:
N Scott: “America’s First Public Turner: How Ruskin sold The Slave Ship to New York,”
British Art Journal , vol. X, no 3. Winter/ Spring 2010. pp 69-77.
Sessions 4 and 5: Understanding Art Auctions
January 27 and February 1
Required Reading:
Ashenfelter, Orley (1989) "How Auctions Work for Wine and Art" Journal of Economic
Perspectives , 3(3), 23-26.
Peter Watson, From Manet to Manhattan: The rise of the modern art market
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(1992), p. 3-26.
For Reference:
Ashenfelter, Orley and Kathryn Graddy (2003) "Auctions and The Price of Art" Journal of
Economic Literature , September, 41 (3), 763-787.
Beggs, A., Graddy, K. (1997) “Declining values and the afternoon effect: Evidence from art auctions”. Rand Journal of Economics 28, 544-565.
Beggs, A., Graddy, K. (2008) “Failure to Meet the Reserve Price: The Impact on the Returns to Art,” Journal of Cultural Economics , 32, 301-320
Beggs, A., Graddy, K. (2009) “Anchoring Effects: Evidence from Art Auctions.” American
Economic Review , 99 (3):1027-1039.
Sessions 6 and 7: The art trade, its history in England, and the practice of painting in a new business context: Painters and dealers
British artists in the art market
– 19 th century London and industrialization;
Painter and dealer: the journey of one Van Gogh masterpiece, from Auvers to Manhattan
February 3 and February 8
Required Reading:
Hamilton, James. 2015. A Strange Business: A Revolution in Art, Culture, and Commerce in
19 th
Century London.
All students: Read Introduction: pp. 1-5;
Choose one: Chapter on “Painter: ‘Painting is a strange business’,” pp. 76-105; or “Dealer: ‘I have picked up a few little things’,” pp. 137-73.
UPLOAD responses to reading questions by Feb 2 nd .
February 8:
Saltzman, Cynthia. 1998 . Portrait of Dr Gachet: The story of a van Gogh masterpiece:
Prologue, pp. xvii-xxii (NB: Study pa ge on “Prices paid for Van Gogh’s Portrait of Dr. Gachet,
18971990”); ch 1, pp. 3-10; ch 4-6, pp. 24-45.
UPLOAD responses to reading questions by Feb 7 th .
Sessions 8 and 9: Art as an Investment
February 10 and February 22
Required Reading:
Landes, William, "Winning the Art Lottery: The Economic Returns to the Ganz Collection."
Louvain Economic Review 66(2) 2000.
Horowitz, N oah, Chapter 3, “Art Investment Funds”, in Art of the Deal: Contemporary Art in a
Global Financial Market (2011).
For Reference:
Baumol, W.J. (1986). “Unnatural value: or art investment as a floating crap game”. American
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Economic Review, Papers and Proceedings 76, 10-14.
Goetzmann, W.N. (1993) “Accounting for taste: Art and financial markets over three centuries”.
American Economic Review 83, 1370-1376.
Graddy, K. Margolis, P (2010). “Fiddling with Value: Violins as an Investment? " Economic
Inquiry , 2011, 49: 1083-1097.
Mei, J., Moses, M. (2002) “Art as an Investment and the Underperformance of Masterpieces”.
American Economic Review, 92, 1656-1668.
Midterm Recess: No classes February 15 and February 17
Sessions 10 and 11: The Gilded Age as Foundation for American Collecting –Isabella
Stewart Gardner, the Havemeyers and Mary Cassatt, JP Morgan, Henry Clay Frick
February 24 and February 29
February 24: Collectors from the era of Isabella Stewart Gardner and JP Morgan to the establishment of the Frick Collection, in New York.
Readings: C Saltzman, Old Masters, New Worlds (2008): (Req. responses for 2/4 readings) ch. II : “C’est mon Plaisir” on Mrs. Gardner and Bernard Berenson (acquisition of Botticelli and
Titian’s Rape of Europa ), pp. 45-92; ch. IV: Mary Cassatt & the Havemeyers’ taste for Spain (El Greco’s View of Toledo ), pp. 109-
44; ch. V: Frick and the Ilchester Rembrandt, pp. 145-96.
Esm ée Quodbach, “ ‘I want this collection to be my monument:’ Henry Clay Frick and the formation of The Frick Collection” Journal of the History of Collecting , vol. 21 no. 2 (2009), pp.
229-40.
Early 20th Century Modernism Gains an Audience
Dealers and Collectors
February 29: Dr. Albert Barnes , and ‘democracy in education’
Colin Bailey, “The Origins of the Barnes Collection, 1912-15,” Burlington Magazine , August
2008, pp. 534-43.
Making Modernism: Picasso and the Creation of the market for Twentieth Century Art.
Required Reading : Michael FitzGerald (1995) “Introduction, Chapter 1: “The Skin of the Bear,” pp. 3-13; 15-48.
Ambroise Vollard, dealer to the avant-garde
Collectors: the Steins in Paris (Gertrude and Leo; Michael and Sarah)
Sergei Schukin in St. Petersburg
Rabinow, R., ed. Cezanne to Picasso : Ambroise Vollard, Patron of the Avant-Garde , 101-117.
Optional: (1992), Chapter 16, “The Kahnweiler Affair,” pp. 206-219. (on the situation during and just after World War I for Picasso and Braque’s German dealer).
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Sessions 12 and 13th: Conceptualists, Experimentalists and Superstars March 2
Galenson and Jensen: "Young Geniuses and Old Masters: The Life Cycles of Great Artists from Massacio to Jasper Johns." NBER working paper 8368
Ginsburgh and Weyers, "Creativity and the Life Cycle of Artists." J Cult Econ
DOI 10.1007/s10824-006-9011-x
Graddy, “Death, Bereavement, and Creativity” CEPR working paper 10753
Case studies of mid20th century and “superstar” auctions
Readings: Acquavella Galleries, New York. (2010) Robert and Ethel Scull: Portrait of a
Collection. Pp. 10-51.
Background Reading:
Galenson, D. W. and B. A. Weinberg (2000), “Age and the Quality of Work: The Case of Modern
American Painters”, Journal of Political Economy 108: 761-777.
Galenson, D. W. and B. A. Weinberg (2001), “Creating Modern Art: The Changing Careers of
Painters in France from Impressionism to Cubism”, American Economic Review 91: 1063-1071.
Rosen, Sherwin (1981), "The Economics of Superstars" American Economic Review , 71 (5)
845-858 (introduction)
Krugman Wells, 2e, Principles of Economics , Chapter 20, Factor Markets and the Distribution of
Income, pages 509-533. OR Mankiw, 4e, Principles of Economics, Chapters 18-20.
Suggested additional reading: Current articles on Sale of Giacometti ( New York Times , May 8,
2010 “Coy Art of the Mystery Bidder”)
Salisbury, Laney and Aly Sujo, Provenance (pdf -22 pp). Prologue: pp. 1-6; ch. 9, pp. 72-81; ch 11, After Giacometti ; ch 12, A Sinister Message ; ch. 14 The Paper Trail .
Session 14 Midterm
March 7
Session 15 Examining value
March 9
Guest speaker, Sara Friedlander ’06,
Vice President, Head of Evening Sale
Post-War and Contemporary Art
Christie’s, NY
Sessions 16 and 17: The Christie’s-Sotheby’s Price-Fixing Scandal
March 14 and March 16
Required Reading:
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Ashenfelter, O., Graddy K. (2005) “Anatomy of the rise and fall of a price-fixing conspiracy:
Auctions at Sotheby’s and Christie’s”. Journal of Competition Law and Economics 1, 3-20.
Background Reading:
Mason, Christopher (2004) The Art of the Steal , Penguin Group, NY.
Krugman, Well 2e Principles of Economics , Chapter 15, Oligopoly, 387-410, OR Mankiw, 4e,
Principles of Economics, Chapter 16.
Session 18: Above the Hammer Price: Commissions and The Droit de Suite
March 21
Required Reading:
Merryman, J. E. “The Wrath of Rauschenberg,” The American Journal of Comparative Law, Vol.
41, no. 1 (Winter 1993), pp. 103-27.
Ginsburgh, V. "What is wrong with the droit de suite? The economic argument"
Background Reading:
Graddy, K. and C. Banterghansa “The Impact of the Droit de Suite in the UK: An Empirical
Analy sis” CEPR Discussion Paper No. 8136.
Krugman Wells, 2e, Principles of Economics , Chapter 7, Taxation, pages 167-183 OR Mankiw,
4e, Principles of Economics , Chapter 12.
Sessions 19 and 20 : Auctions without heirs
March 23 and 30
1) Nicholas, Lynn H . “Prologue: “ ‘They had four years,’ ” pp 3-25, in The Rape of Europa ,
(1994).
2) Feliciano, Hector. “Anatomy of a Pillage: The Paul Rosenberg Gallery: Modern and
“Degenerate” Art for Sale,” pp. 52-74, in The Lost Museum , Pt. II ch. 5 ( 1995).
3) Ronald, Susan. 2015. Hitler's Art Thief: Hildebrand Gurlitt, the Nazis, and the Looting of
Europe's Treasures. Chapter to be listed.
March Break: March 25- 28 (no class on Monday, March 28)
Session 21: 20th century Practices in Shaping a Collection: The Rose Art Museum- a
Case Study
April 4
Ketner, J. A defining generation : then and now, 1961 and 2001: The Rose Art Museum,
Waltham (2001). Interview with Sam Hunter, first Rose Director.
Scott, N. “When The Unthinkable Happens: Fault Lines and Horizon Lines at the Rose Art
Museum,” Vol. II, pp. 552-91. Academic Museums: Campus and Community. 2 vols. Edited by Stefanie S. Jandl and Mark S. Gold. MuseumsEtc Ltd. Hudson House, Edinburgh | UK.
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Case studies of mid20th century and “superstar” auctions
Readings: Acquavella Galleries, New York. (2010) Robert and Ethel Scull: Portrait of a
Collection. Pp. 10-51.
Session 22: Guest Speaker
April 6
Speaker: George Wachter, Chairman of Sot heby’s North and South America and Co-chairman of Old Master Paintings Worldwide
Session 23: Snow Date/ Make-up Class
April 11
APRIL 12 – Special Econ FA class event: Annual Saivetz Architectural Forum.
Amie Siegel, film and video artist will present her process and details behind the scenes making
Provenance .
Session 24: Guest Speaker: TBA
April 13
Sessions 25 and 26: Student Presentations
April 18 and April 20
Session 27 : May 2 nd , Review and Catchup
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