Reconcile or not?
An empirical study on status and price within the contemporary art world
This PhD research examines how the price for contemporary art comes into being. We shift our focus on valuating quality of the artwork to the status signaling in understanding the mechanism of price formation in contemporary art market. A further distinction of market status from professional status is made based on the concern of the emergence of lay investors in nowadays contemporary art market. We propose that market status, as a specific set of artist status related to the market reputation, is a proximal market mechanism that can account for the distal relationship between professional status and price.
Prior studies have demonstrated that professional status can significantly influence the artwork price, but the effect directions are confusing. The status signaling theory and the symbolic pricing studies provides theoretical as well as empirical evidence that professional status signals the quality of artwork thus has positive effect on price (Velthuis, 2003; Bonus & Ronte, 1997; Yogev, 2010; Beckert, 2011; Beckert & Rössel, 2013). Contrasting to the alignment of professional status and price, empirical studies on Korean neoliberal art auction (Shin et al., 2014) and modern visual artist (Lang & Lang, 2016) show the negative association of professional status and market success. The breach of art and commerce is explained by the logic of art autonomy (Bourdieu, 1993) and the theory of social identity (Shrum, 1991; Wijnberg & Gemser, 2000; Shin et al., 2014). The contradicted empirical results motivate us to examine carefully the model design and bring in the mediation framework in our study to address the limitations of naïve regression in the existing price formation studies.
The mediation framework enables us to introduce a third variable into a two variable relation that the third variable mediates in between and transmits the effect from one variable to the other (Judd & Kenny, 1981; Baron & Kenny, 1986; Holbert & Stephenson, 2003). Mediation analysis is prevalent in psychological and social studies in understanding the mechanism and process of how the independent variable influences the dependent variable (Vinokur, 1997; Holbert & Stephenson, 2003; Zhang et al., 2009; Chen, et al., 2007; Brader, et al., 2008). However, to the best of knowledge, no research has employed the mediation framework in studying the relation of status and price in art market. With the concern of the predominance of lay investor in contemporary art market, we propose that market status, as a specific set of artist status related to the market reputation, is a proximal market mechanism that can account for the distal relationship between professional status and price. Specifically, we argue that the positive relationship between professional status and price is explained by the chain effect that higher professional status is associated with higher market status and higher market status leads to higher artwork price. The effect of professional status exerts on price though market status reflects the logic of concordance in the market sphere. When the change of professional status dose not trigger out the increase of market status, professional status is expected to be negatively associated with artwork price due to the logic of contradiction in the cultural sphere.
The broader research question for this PhD project is:
- How is the price related to the artist status within the contemporary art world?
Broader sub-question includes:
a) How is the artist status (especially professional status) evaluated?
b) When both market and professional status are perceived, how is art price associated with market status and professional status?
c) How will the findings of question a) and b) differ when we shift our research context from the core countries of the art field (America and West Europ) to the peripheral country (China)
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