Ethics in the Art Market

Today in one of my art history classes, we discussed the greatly heated debate of whether or not the art market is ethical and if so, is it less ethical than the stock market. At first, I was somewhat taken aback. Comparing the art market to the stock market seemed quite a longshot. The art market deals with fine works of art, excellent pieces composed by masters, those that have changed the face of what art is and how art affects society. The stock market, so far as I know, is nothing more than intangible dealing with numbers – figures so far removed from the everyday life that it is nearly impossible for me to correlate the two.

However, once we began to delve into the topic, it became apparent that the differences between the stock and art market are not nearly as great as they initially seemed to be. Rather, there are quite a few similarities. The thing that struck me most, however, was that the legal regulations that are implemented on the stock market are nowhere to be found in the art market. For instance, in the art market, the auction house can be a bidder at the auction, invariably raising the price and the base price of works of art without any restriction or regulation. But is that, in any way, fair? Should the auction houses, rather than the buyers, be the ones setting the market? And if it is the auction houses, how are they determining the value?