The price is right

A few weeks ago I was thinking about the constraints dealers are under when it comes to pricing their artists' work. Over the weekend Ed Winkleman was musing on the same topic: 'Established prices never die, they are just discounted away ...'.

From the post:

Knowing that eventually the art market will cycle back up again, there's no reason not to expect a good artist's prices to regain any losses, but that here and now, the most surefire way to cripple that artist's market is to keep the prices as high as they were. In other words, by getting the collector to participate in the continuation of the artist's market, rather than focusing on a momentarily downturn in pricing, both dealer and collector continue to protect their investment. And, of course, in the meanwhile, the collector still gets to enjoy a fantastic work of art.

Ed's is one of the few blogs that I've stayed faithful to. Some blogs I become briefly infatuated with, visiting regularly, hanging round on the off-chance a new post might appear unexpectedly. Then the passion cools and the relationship reduces to a space in my feedreader, a holding bay I visit when I don't have anything better to do, catching up to fill an idle moment. Eventually I give up the pretence that there's still any spark, and delete the subscription.

But Ed I keep coming back to, and it's because of his openness, and the insights he gives me into an art dealer's way of working. From the comments to the above post:

The artist, being owner of the work, has ultimate say in the retail price, of course, but most contemporary art dealers rightfully have input in how the work is priced through their gallery. Usually artist and dealer are on the same page, though, so it's not as contentious as your question might imply. When I say the dealer overpriced the work, I mean to implicate both the dealer and the artist, but the collector works directly only with the dealer, so they're not part of that previous conversation.

Sometimes, however, a dealer should speak up or back out when they know the artist is making a mistake. If an artist insists that a painting be priced at $100,000 when the dealer believes its market value is $40,000, for example, the dealer would be wrong to price at what the artist insisted on. If the artist still insists after a respectful conversation, at that point they should part ways. The dealer has the markets of his other artists and how his reputation impacts them to consider here as well.