Since the 1960s, art has been viewed as a potentially valuable commodity, much like stocks. Many of those who collect art treat it as an investment that will increase in value that will pay off over time.
Prior to the vast commercial interest in art, critics would determine how valuable a work of art was aesthetically in their reviews. Today, the role of the critic has been undermined by that of the collector, who determines the value of a work of art by how much he is willing to pay for it.
According to critic James Panero, the work that typically sells for the most money offers quick punch lines and is easy to decipher. More complicated works of art, which might involve extensive visual contemplation, are not deemed as valuable in the contemporary art market.
The current value of art works is largely determined by the price they go for at auction houses. This can affect an artist’s entire career—if one work by an artist sells well, then chances are other works will also be deemed similarly valuable.
While auctions do not financially benefit artists personally, it can have a positive effect on their financial futures. When an artist’s prices rise at auction, then the prices on new works sold by their dealers, and from which they receive a large percentage of the profits, will also rise.