Marion Maneker2December 27, 2012

Six Questions About the Hirst Market

The interview below was instigated by Amelia Ilangaratne, a Ph. D. student at the University of Leeds who has been polling a number of people about the effects of value on demand for Damien Hirst’s work. Ilangaratne asks the questions that many people do about the art market. So I thought it worth reproducing here my opinions on what drives Hirst’s market forward.

Do you believe, in the past decade, that Damien Hirst has increased his focus on creating artwork with the purpose of investment (for his own financial gain) rather than aesthetic or personal value? 

I don’t think Hirst made art for investment purposes. Nor do I think he is primarily motivated by making money. There’s nothing wrong with his desire to make money from his art or to have his art be exceedingly popular.

Recent figures show that works made by Hirst from 2005-2008 have sold at a 30% loss. Do you believe there to be reasons for the decrease in prices, besides the oversupplying of work?

The primary reason for the drop in his prices has been his failure as an artist post-2008 when he began to paint again. The loss of mystique that those poorly received works caused is a greater detriment to his prices than the over-production. But the uneven quality of much of his over-produced work echoes the poor quality of his recent artistic practice and has halted his momentum as an artist.

Have the tactics employed by Hirst and his dealers to increase the value of his work, e.g. bidding on his artwork, helped to raise the demand for his work, or simply aroused publicity over the artist and his work? 

I think the question is structured to make an answer impossible. An active market that is actively made by participants with a financial interest does not necessarily create demand or publicity. An actively managed market is a reflection of demand being attenuated or tempered but not created. Publicity is never something that can be generated simply by fiat or the will of the beneficiary. Complaints to that effect are both naive and petty. The use of the word hype is a tell that the user is making a value judgment but not looking into the actual cause or structure of demand. If hype were easy to create simply by spending money, all artists with backers would be hyped. It’s a tautology.

What evidence could suggest that ‘For the Love of God’ can be considered an artwork made with the sole purpose of creating profit for the artist and his dealers?

No. So far that work has not made any money for the artist, his dealer or financial backers. Quite the reverse, in years to come, For the Love of God will live on as an emblematic work of the aughts and will be reproduced in every historical work about the time. It was not sold and likely won’t ever be sold. Buying the work would be a stigma for the owner and it not having ever been sold will continue it as an emblem of a period of loose credit and heedless chasing after wealth. Of the few truly important works that Hirst undeniably has made (the shark, many of the spots, the medicine cabinets, the vitrine with the rotting cow’s head and fly zapper), the skull will stand out as one of the most memorable and reproduced.

Collector Alberto Mugrabi cites the preference of collectors for expensive work, due to the associations with status that the work brings. Would it be possible that a drop in the prices of Hirst’s work, and hence a taint in the brand, could result in less interest from these collectors, who are only interested in the work due to its connotations with brand and wealth?

Again, your question is built on premises that I can’t agree with. Artists are not brands. Cookies are brands. Other useful objects made in mass quantities that need to be differentiated from similar products are brands. Those who buy a work simply because it is by Damien Hirst without regard to the quailities of the work itself–and there are surely many–are buying because they perceive the work to have continuing value or currency to others. So, yes, if that perceived value or currency erodes, the prices will not recover. In that scenario, the prices for many of the works could fall to zero.

As stated above, though, the prices have dropped more because of Hirst’s failure to move forward as an artist in a meaningful way and the variable quality of his over-production (the spots show revealed that many of the spot paintings were simply not works of art or even decoration.) But once the prices started to fall, they will continue to fall (or, more likely, not transact) until an exogenous factor regenerates demand. That might be simply time or Hirst creating new work that once again excites collectors or critics or demand from another factor.

If a drop in prices results in a drop in demand from wealthier collectors, do you believe that a lower price level for Hirst’s could be established? Could this enable a new market for his work to potentially emerge which is more representative of today’s prices, therefore helping to maintain the demand for Hirst’s work? 

Does it matter? Prices are not a thing in themselves. They are a reflection of demand and supply. Unless you own Hirsts as an investment, the price is irrelevant. It is true that many buyers will feel safer buying something that is expensive and seems to have its value validated but that’s not what drives the transactions. When buyers see social, art historical or currency value in works by Hirst, they will buy them at whatever prices are current. There are many genres of work and artists whose prices have fluctuated wildly over time.