The art market has always been subject to economic, social, cultural, legal and technological influences. Over the last two decades, radical changes have reshaped the market in a very dramatic and positive fashion. The main developments have been the introduction of online auctioneering, the growth of multiculturalism, and economic and legal changes that have impacted the art market.

How the Internet has changed the way we buy art

While many traditional art collectors and traders may still prefer the excitement of live auctions, the rise of the online auction has greatly changed the way art is bought and sold.

The Internet began to catch on in the mid-1990s and eBay entered the scene in 1996. By early 1997, the company was hosting more than 2 million virtual auctions per month. EBay’s rapid success and dynamic growth caught the attention of established auction houses like Sotheby’s and Christie’s, both of which now offer online auctions and catalogues.

With the advent of the Internet, auctions became available to many more people and the bidding and selling now goes on around the clock every day of the year. More than ever before, it is relatively simple to scan for items anywhere on the globe at any time of the day and place bids on art for sale. At the same time, sellers of art also benefit from the convenience, flexibility and versatility of the Internet medium.

Multiculturalism and other cultural factors

History over the last few centuries had favoured the white male of European descent at least in the upper echelons of the art market.

In the last 20 years, this trend has changed dramatically. Not only are there more artists that are people of colour and women, but we also see the same changes in buyer profiles. African artists, for example, have become much more prominent. In the 2000s, art from Asia, Latin America, the Middle East and Russia was popular.

Sheikh Saud bin Mohammed bin Ali al-Thani of Saudi Arabia is one of the world’s top art collectors. The market for art in China and Hong Kong has grown exponentially in the last two decades.

Hong Kong billionaire Joseph Lau, for example, was rated by Forbes as one of the world’s top art aficionados and among his most noteworthy purchases is Paul Gauguin’s Te Poipoi for $39 million.

Economic and legal influences

Art has always been seen as an investment asset and this factor has strongly influenced the art market. In the 1980s, art was seen as a great investment and the market flourished as a result. However, as can be expected in economic cycles, in the 1990s there was a fear that the market had become too saturated and investors retreated in turn.

Some studies suggest that the art market rises and falls in conjunction with the stock market or the economy in general. As stocks rose in the early and mid-2000s, investors also rushed to buy art. The “Great Recession” that started in late 2007 also seems to have impacted the art market. Sotheby’s and Christie’s, for example, reported that art sales were halved in 2008. As the economy has started to recover, a rebound is also occurring in global art sales. According to a Reuters report in January 2011, Orientalist painting is now a hot commodity.

Another trend in the last two decades involves the legal status of art. Courts have been inclined toward returning stolen or looted art work and antiquities back to the rightful owners. In the past the art market was rather lax in vetting items that were sold in auctions.

Today, there have been many instances in which stolen items have been returned after evidence was submitted to the court. Often art is taken as booty during wars or is looted during archaeological investigations. In the last 20 years, courts have sided with previous owners or with nations that claim objects as cultural heritage.

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Copyright Charles Frost, 2010 All Reproduction Rights Reserved