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Art as a Wartime Investment: Conspicuous Consumption and Discretion

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  • Kim Oosterlinck

Abstract

During World War II, artworks significantly outperformed all alternative investments in Occupied France. With the surge in demand for portable and easy†to†hide (discreet) assets such as artworks and collectible stamps, prices boomed. This suggests that discreet assets may be viewed as crypto†currencies, demand for which varies depending on the environment and the need to hide value. Regarding art market valuation, this article argues that while some economic actors derive significant utility from conspicuous consumption, others value the discretion offered by artworks. Motives for purchasing art may thus vary over time.

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  • Kim Oosterlinck, 2017. "Art as a Wartime Investment: Conspicuous Consumption and Discretion," Economic Journal, Royal Economic Society, vol. 127(607), pages 2665-2701, December.
    • Handle: RePEc:wly:econjl:v:127:y:2017:i:607:p:2665-2701
    DOI: 10.1111/ecoj.12391
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    Cited by:

    1. William N Goetzmann & Christophe Spaenjers & Stijn Van Nieuwerburgh, 2021. "Real and Private-Value Assets [Gendered prices]," The Review of Financial Studies, Society for Financial Studies, vol. 34(8), pages 3497-3526.
    2. David, Geraldine, 2016. "Art as an investment in a historical perspective," Other publications TiSEM 2361da4b-d827-4cae-91ce-1, Tilburg University, School of Economics and Management.
    3. Garay, Urbi, 2021. "Determinants of art prices and performance by movements: Long-run evidence from an emerging market," Journal of Business Research, Elsevier, vol. 127(C), pages 413-426.
    4. Kyriazis, Nikolaos & Corbet, Shaen, 2024. "Evaluating the dynamic connectedness of financial assets and bank indices during black-swan events: A Quantile-VAR approach," Energy Economics, Elsevier, vol. 131(C).
    5. Kim Oosterlinck, 2024. "Arturo Cifuentes and Ventura Carlin: the worth of art. Financial tools for the art market. New York, Columbia University Press, 2023," Journal of Cultural Economics, Springer;The Association for Cultural Economics International, vol. 48(1), pages 167-170, March.
    6. David, Géraldine & Li, Yuexin & Oosterlinck, Kim & Renneboog, Luc, 2021. "Art in Times of Crisis," Discussion Paper 2021-026, Tilburg University, Center for Economic Research.
    7. Geraldine David & Christian Huemer & Kim Oosterlinck, 2023. "Art dealers’ inventory strategy: the case of Goupil, Boussod & Valadon from 1860 to 1914," Business History, Taylor & Francis Journals, vol. 65(1), pages 24-55, January.
    8. Oosterlinck, Kim & Reyns, Ariane & Szafarz, Ariane, 2023. "Gold, bitcoin, and portfolio diversification: Lessons from the Ukrainian war," Resources Policy, Elsevier, vol. 83(C).
    9. Kim Oosterlinck & Anne-Sophie Radermecker, 2019. "“The Master of …”: creating names for art history and the art market," Journal of Cultural Economics, Springer;The Association for Cultural Economics International, vol. 43(1), pages 57-95, March.
    10. Gilles Boevi Koumou, 2020. "Diversification and portfolio theory: a review," Financial Markets and Portfolio Management, Springer;Swiss Society for Financial Market Research, vol. 34(3), pages 267-312, September.
    11. Daniel Levy & Avichai Snir, 2018. "Here Lives a Wealthy Man: Price Rigidity and Predictability in Luxury Housing Markets," Working Paper series 18-16, Rimini Centre for Economic Analysis.
    12. Ginsburgh, Victor & Radermecker, Anne-Sophie & Tommasi, Denni, 2019. "The effect of experts’ opinion on prices of art works: The case of Peter Brueghel the Younger," Journal of Economic Behavior & Organization, Elsevier, vol. 159(C), pages 36-50.
    13. Oosterlinck, Kim & David, Géraldine & Huemer, Christian, 2019. "Art Dealers’ Inventory Strategy The case of Goupil, Boussod & Valadon from 1860 to 1914," CEPR Discussion Papers 13941, C.E.P.R. Discussion Papers.
    14. Łukasz Zakonnik & Piotr Czerwonka & Grzegorz Podgórski & Karolina Zajdel & Radosław Zajdel, 2022. "Art Market Investment Bubble during COVID-19—Case Study of the Rare Books Market in Poland," Sustainability, MDPI, vol. 14(18), pages 1-20, September.
    15. Kim Oosterlinck & Anne-Sophie Radermecker & Yuqing Song, 2023. "The Valuation of Copies for Chinese Artworks," Working Papers CEB 23-008, ULB -- Universite Libre de Bruxelles.
    16. Anne-Sophie V. E. Radermecker, 2019. "Artworks without names: an insight into the market for anonymous paintings," Journal of Cultural Economics, Springer;The Association for Cultural Economics International, vol. 43(3), pages 443-483, September.
    17. Georges Gallais-Hamonno & Thi-hong-van Hoang & Kim Oosterlinck, 2016. "Price Formation on Clandestine Markets: The Case of the Paris Gold Market during WWII," Working Papers CEB 16-048, ULB -- Universite Libre de Bruxelles.
    18. Georges Gallais‐Hamonno & Thi‐Hong‐Van Hoang & Kim Oosterlinck, 2019. "Price formation on clandestine markets: the case of the Paris gold market during the Second World War," Economic History Review, Economic History Society, vol. 72(3), pages 1048-1072, August.
    19. Savva Shanaev & Nikita Shimkus & Binam Ghimire & Satish Sharma, 2020. "Children’s toy or grown-ups’ gamble? LEGO sets as an alternative investment," Journal of Risk Finance, Emerald Group Publishing Limited, vol. 21(5), pages 577-620, November.
    20. Kim Oosterlinck & Anne-Sophie Radermecker, 2021. "Regulation or Reputation? Evidence from the Art Market," Working Papers CEB 21-006, ULB -- Universite Libre de Bruxelles.
    21. Li, Yuexin, 2021. "Pricing art: Returns, trust, and crises," Other publications TiSEM 8832c172-83dd-4ed9-8215-0, Tilburg University, School of Economics and Management.

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    More about this item

    JEL classification:

    • G10 - Financial Economics - - General Financial Markets - - - General (includes Measurement and Data)
    • N44 - Economic History - - Government, War, Law, International Relations, and Regulation - - - Europe: 1913-
    • Z11 - Other Special Topics - - Cultural Economics - - - Economics of the Arts and Literature

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