Michael O’Hare is a professor of public policy at Berkeley. He wrote a timely—and too far reaching to summarize—essay in Democracy Journal exploring how art museums might generate real return on equity based upon the value of its collection. What makes the essay so interesting is that O’Hare’s approach embraces museums selling their works to invest in other aspects of their mission. It also demands that these institutions develop a better sense of whose interests they serve and how art can best reward the public:
Big museums have long refused to recognize their unexhibited collections of duplicates and minor works as a financial resource. As a consequence, they are wasting value by keeping these works hidden. If they were redistributed to smaller institutions, and even to private collectors and businesses, they would fund an explosion of the value for which we have museums in the first place: people looking at art and getting more out of it when they do. […]
Where’s the art? Incredibly, it’s not there. No museum known to me recognizes its art collection on its balance sheet. When it buys a painting, there’s an expense, and then it just disappears, as though they bought lunch for everyone and ate it. This might not matter if the amounts were small, but they are actually quite breathtaking. I have estimated the value of the collection of the Art Institute of Chicago (AIC) by triangulating in various ways from a couple of the rare cases in which museum collections were actually appraised (Detroit and the Berkeley Art Museum). The 280,000 objects in its collection turn out to be worth between $26 billion and $43 billion.
Museums Can Change—Will They? (Democracy Journal)