*This sure sounds erudite and plausible. The tech art scene works quite like this, except that you also throw in a lot of tech.
It's not about the money, it's about the art that's also, uh, really really valuable
(...)
Informal corners of the art world
When art world insiders think of the art market, they generally consider international auction houses and dealers in New York or London, though they may be active in Mexico City, Moscow, or Dubai. But this is not the whole of the art market. There is a considerable gap between the estimated art market scale as measured, for example, by Clare McAndrew in her annual survey for TEFAF, and the actual markets for art and art-related products. This gap would include everything from the “starving artist” liquidation sale to regional art fairs where artists market and sell their own work, to the factories in China that manufacture painted reproductions of Old Master and Impressionist paintings. It is tempting to see such activities as marginal to the main event of the art market, and, like the informal economic activity described above, they are marginal. But the question remains: How big is this part of the art economy? Is it 7 or 44 percent?
The blending of black and white economies is an issue of increasing importance to the art market, which few commentators have addressed. Were sales taxes paid in the reported $250 million private sale of one of Cézanne’s Card Players paintings to the royal family of Qatar, and if so, in which country? Were customs duties assessed? Was the painting sent directly from the seller to the buyer, or did it pass through duty-free port? What was the commission that the dealer was paid? Were there middlemen who also profited from connecting the parties, and if so, did they pay income taxes on this income, or was it transferred to an offshore company or trust?...
Artists and the informal economy
Artists have been in the informal economy for a long time, making sales of their own works in unregulated contexts, such as selling work out of the studio or at an art fair.
In such contexts, it is not common for them to charge sales tax, for example, and it does not seem unreasonable to suggest that they might not report this income on their tax returns. If a dealer or curator gives an artist an emerging artist an exhibition, it is common for an artist to gift a work of art to her and this kind of gift might not turn up as a transaction on anyone’s books. These are the kind of gifts that Velthuis describes as cementing the social relations of the art world. They are based on mutual generosity that cannot be measured, and so there is an argument to be made that it should not be.
The informal economy in the art world is not only a series of shady business deals, though it does include these, but also a way in which the distant and objective art market is personalized and made immediate. It is a symptom of the shrouded financial transactions of the offshore economy and salve to soothe the wounds that capitalism inflicts on those whose labor eschews its financial logic.
Artists, curators, and nonprofit directors, among others, work for free because they want recognition and want to participate in a public conversation, but also because they do not want their labor to be monetized....
