In the past I’ve harped on some of Felix Salmon’s art market posts, especially his knee-jerk tendency to condescend to the rich. So it’s worth my taking a moment to point out when Felix is spot on about something.

In trying to explain the record price for Edvard Munch’s The Scream, Salmon reminds us that the work is one of a series of four works. The other three are in Norwegian museums. The same is true of an earlier record holder, Giacometti’s Walking Man, which was one of an edition of six with four artists proofs (effectively making 10 of them.)

Remember the Card Players which sold for $250 million? Or, for that matter, the Jeff Koons Rabbit I wrote about earlier this week, which is probably worth the same amount of money asThe Scream, more or less? The three artworks all have something in common: they’re editions, broadly speaking. There are four Screams, five versions of the Card Players, and four Rabbits. And in each case, the value of any given work goes up, not down, as a result of the existence of the others.

That’s because what people are buying, when they buy one of these pieces, is a cultural icon, something instantly recognizable.

Salmon suggests that its simply a matter of vulgar billionaires lacking independent taste that drives these prices. But he’s ignoring a simple market mechanism. Prices, we’re always told, are set on the margin. In the case of art, when a series is owned by important collectors and museums, the highest price is achieved when a work is considered the last available one to sell.

We saw some of this effect when the Matisse series of bronze “backs” were sold last year for $120 million. The original asking price was based upon a sale the previous year of a single back for $48.8m. That price provoked an institution that owned the full series to offers theirs up for sale by simply multiplying the price of one back by four times and asking for $200m. Of course, that violates a simple rule of markets. The $48m price was paid with the idea that no other Matisse back would come up for sale. If all of the editions were up for sale at one time, the prices would necessarily have been even lower. That’s the way markets work.

Salmon focuses on the fact that multiples validate the work for an insecure buyer. That’s unknowable. But in market terms, multiples make it easier for their to be more buyers than dictated by individual taste. The Backs, of course, are hardly “instantly recognizable” even after sales that equalled the Munch.

Art Valuation Data Points of the Day (Reuters)