Richard Morrison

If you read no other book about art in your life, read the one that’s gripped me like a thriller for the past two days. Just published by Aurum Press, it’s called The $12 Million Stuffed Shark. And the first surprise is that its author, Don Thompson, is not an art specialist, but a Harvard economist. When you read the book, however, all becomes clear. What Thompson does – lucidly, and with remarkable restraint in the circumstances – is take the lid off what he calls “the curious economics of contemporary art and auction houses”. Curious is one word to describe it. Mad would be my choice.

The book’s title is also its starting point. Thompson sets out to discover why someone thought it was fulfilling and rational to spend $12 million buying a dead shark that had been turned into an artwork by Damien Hirst. But answering that seemingly simple question takes him into a world in which “normal” values – about life, art and money – seem to have been turned topsy-turvy.

He looks at the buyers for “trophy” art: billionaires such as the American asset manager Steve Cohen, who bought the shark with what, for him, was loose change (it would have taken him five days, Thompson estimates, to have earned the $12 million price tag). He examines the motivation of these super-rich culture vultures – who are, incidentally, increasingly numerous: the world had 946 billionaires at the last count. He discusses how they feed their egos by outbidding rivals; how they flaunt wealth and status by filling their mansions with the most outrageously priced artistic sensations; and, most of all, how they apparently need to signal to the outside world, and perhaps to themselves, that they aren’t mere money-making robots – that they actually possess a soul, even if it’s one that manifests itself by the curious device of acquiring art that Charles Saatchi deems to be “hot”.

Then he looks at Saatchi himself, and other super-collectors and dealers who have the clout to “brand” artists and thus raise their market value tenfold – or, conversely, to “punish” (Thompson’s term) artists by expelling them from the anointed fold. “You are nobody in contemporary art until you have been branded,” Thompson declares. And he goes on to examine the deals struck between powerful collectors and public galleries, whereby the former effectively bankroll exhibitions of their collected artworks in the latter, knowing that the public exposure and status conferred by the gallery will enormously raise the value of the art they own.

After that, Thompson looks at the few artists (maybe one in every thousand) lucky enough to be elevated into this stratospheric existence – of whom Hirst (estimated worth: £100 million at the age of 40) is the prime instance. In what sense do they “create” artworks that unnamed assistants actually paint, cut up or assemble? In what sense is a buyer acquiring a unique work, if the artist feels free to create near-identical pieces for other buyers (as Warhol did and Hirst does)? Is the genius all in the labelling and marketing? Is it all a big con? Should we lament the present confusion between cash price and artistic worth – or, as Thompson puts it, “the ease with which art history is now rewritten with a cheque-book”? Is the success of a few superstar artists good or bad for the rest – those who scrape by on the poverty line, yet produce art that may well be far richer in significance than some of the conceptual piffle churned out by the big names?

Here’s one more question. If people are being hoodwinked into bidding huge sums for rubbish, what does that say about the ethics of the auction houses? Thompson exposes the subterfuges and sophistries they use to ratchet up bids and increase their commissions – some of them jaw-droppingly sneaky. “The art world,” he says, “is the least transparent and least regulated major commercial activity in the world.” After reading the evidence he amasses, you can’t disagree. Some of what goes on in the plush salerooms of Mayfair and Manhattan would make a dodgy Essex secondhand car-dealer gasp with admiration.

Part of me says that what the mega-rich do with their money is up to them. And if a few artists can earn a few quid (or $12 million) by flogging dead sharks or used underwear to the gullible glitterati of Beverly Hills, good luck to them. But there are wider implications here that Thompson, fine economist though he is, only hints at.

First, whenever the public reads that a pile of detritus labelled “art” has been flogged for millions, or won the Turner Prize, cynicism about the value of high-brow culture intensifies. So does the feeling among ordinary people that the arts are “not for them”. That’s a shame, to put it mildly. Secondly, whenever some clueless Russian oil oligarch or Californian software mogul is soft-soaped into paying crazily over the odds for a modest Klimt or Klee, that inflates the price of all Klimts and Klees and makes it impossible for public galleries to compete on our behalf.

And thirdly, whatever happened to the idealistic notion that people went into the arts because they believed there was more to life than making money? As Thompson points out, the contemporary art market has now degenerated into “a competitive high-stakes game, fuelled by great amounts of money and ego”. But if modern art is all amount money and status, what’s the point of it? As Warhol once observed, you might as well put all your dosh in a bag labelled “Look how rich I am!” and hang it on your wall. It would make the same statement.

Or, for upwards of £50 million, you could buy Hirst’s latest headline-grabbing creation: a platinum cast of a human skull embedded (though not by himself) with 8,601 diamonds. Wittingly or unwittingly, he has created the perfect metaphor for the brain-dead, money-fixated world of modern art that Thompson so devastatingly exposes.