The markets for art and antiques have satisfied both consumers’ quest for elaborate furnishings and decorative objects to add beauty and status to their lives and people’s desire to invest in objects that are likely to appreciate, largely independent of fluctuations in the stock market.
Antiques and art are sometimes grouped into the same market not only because they are often sold together but also because these objects depend on subjective appeal and social acceptance to determine their value in the marketplace. Antiques, which include many objects such as domestic items and furniture, derive their value primarily from their age and condition, rarity, and the items’ beauty or craftsmanship. Art, in the context of antique and art markets, most often refers to the visual arts, including painting, sculpture, and printmaking. The appreciation and collection of both antiques and art are considered to be an indicator of status in many societies, including that of the United States.
Although many artists and artisans produced works even during the colonial days and many antiques and artworks had been imported into the United States, the relative youth of the country, its small number of museums, and a seeming lack of tradition caused the country to be a lesser player in the antique and art markets for many years. However, the American antique and art markets gained international prominence during the 1950’s, when
Although ownership of antiques and art is typically transferred through ordinary marketplace transactions (through inheritance, retail shops, auctions, and online purchases), one of the most important relationships in the antique and art markets is between the art dealer or collector and museums and galleries. Through the acquisition and exhibition of antiques and works of art, museums and galleries provide exposure and add legitimacy to these objects and the artists or craftspeople who produced them. Such acquisitions and exhibitions increase the value of the items involved as well as the value of any similar items in private collections. Similarly, media coverage of artists, antiques, and artworks can enhance the value of antiques and art. Articles in reputable art magazines and books from art publishers can increase the perceived value of an item.
Most individuals who actively participate in the antique and art markets view the purchase of both antiques and art as not only an aesthetic pursuit but also as an investment. Investment in both markets requires specialized knowledge: For the antique market, the investor must know what items were produced in a particular historical period and must be able to identify the items’ notable characteristics, whereas for artworks, the investor must gain specialized knowledge of individual artists.
The general perception is that investment in the antique and art markets is purely speculative; however, this is not borne out by evidence. Although there is a risk with any investment, the antique and art markets have proven to be considerably less volatile than the stock market. The idea that the antique and art markets are volatile may have been created when the bullish stock market of the 1980’s seemed to have encouraged unusually high levels of investment in artwork and antiques, followed by a significant correction, or downturn, in the markets during the 1990’s. For the most part, market analysts believe that the correction was only to be expected in view of the runaway prices of the 1980’s. Nonetheless, the antique market later proved to be surprisingly stable during a period of economic unrest; from 1997 to 2004, the quarterly fluctuation, as reported by the Artprice Global index, proved to be half or two-thirds that of the Dow Jones Industrial Average over the same period. The same type of stability had previously held true for the antique and art markets during and after the Vietnam War and continued to do so in the wake of both September 11, 2001, and the start of the Iraq War in 2003.
Market analysts believe that there are several reasons that the antique and art markets are able to maintain, and even increase, their numbers of participants even during times of social and economic unrest. The most important reason cited for the stability of the antique and art markets is that of precedence; throughout the history of these markets, prices have, overall, increased at a fairly predictable rate. The antique and art markets seem, according to analysts, to be somewhat unusual in that investors can reasonably expect that the value of a given good will increase over time, notwithstanding the fluctuations of the stock market.
Luecke, Marjorie Ann. The International Antiques Market: A Guide for Collectors and Investors. South Brunswick, N.J.: A. S. Barnes, 1979. Provides an overview of the various categories of antiques, including price guides with projected price trends. McAndrew, Clare. The Art Economy: An Investor’s Guide to the Art Market. Dublin: Liffey Press, 2007. An interesting overview of the global art market from the point of view of an investor; discusses the value of art as a financial investment with comparisons of the returns on art investment in comparison with those on stocks and other assets. McNulty, Tom. Art Market Research: A Guide to Methods and Sources. Jefferson, N.C.: McFarland, 2006. Provides an introduction to the art market, including information about artwork analysis and valuation. Also includes a list of pertinent periodicals and auction houses. Parker, Philip M. The 2007 Import and Export Market for Antiques Over One Hundred Years Old in the United States. San Diego, Calif.: ICON Group International, 2006. An overview of the global antique market with a focus on the United States market, providing estimated figures for the volume of imports and exports per country and by region, providing a comparison of the United States market with other major country markets. Robertson, Iain. Understanding International Art Markets and Management. New York: Routledge, 2005. An overview of the international art market, including a discussion of the reasons that the market is dominated by the United States and Western Europe.
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