economics of art

“It was in the early 1950s that Picasso’s earning power and wealth became fabulous to this degree. The decisions which so radically affected his status were taken by men who had nothing to do with Picasso. The American government passed a law which allowed income tax relief to any citizen giving a work of art to an American museum: the relief was immediate, but the work of art did not have to go to the museum until the owner’s death. The purpose of this measure was to encourage the import of European works of art. (There is still the residue of the magical belief that to own art confirms power.) In England the law was changed – in order to discourage the export of art – so that it became possible to pay death duties with works of art instead of money. Both pieces of legislation increased prices in salerooms throughout the art work.”

(John Berger, The Success and Failure of Picasso (1965), p. 4)

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