The Veblen effect, Roger Blackley

Behind the Canvas: An Insider’s Guide to the New Zealand Art Market
Warwick Henderson
New Holland, $45.00,
ISBN 9781869663674

In a recent New Zealand Listener, cultural curmudgeon Hamish Keith commented on the dangers of the art market: “Buying and selling art seems a swashbuckling kind of a business … a rowdy mix of taste, fashion and vigorous manipulation in which the difference between price and value is easily confused”. Keith cited the famous example of the Belle Époque dealer Joseph Duveen who, with art historian Bernard Berenson, made a fortune through the exchange of American money for European old master paintings. Berenson contributed the convincing attributions to support the stratospheric price-tags for which Duveen was so famous. While Duveen is an extreme case, what’s clear is that buying cheap and selling dear is fundamental to the industry ‒ and important whether you are dealer or investor.

Longstanding Auckland art dealer Warwick Henderson sets out to demystify a “difficult and dangerous place” that is apparently worth more than $50 million annually. How could a novice hope to replicate behaviour such as Keith describes in the preface to the book? In 1958 he invested five pounds (from his first pay packet!) on a Colin McCahon landscape that would today fetch tens, if not hundreds of thousands. Helping a new collector/investor to achieve similar results is the ostensible purpose of the book; the upbeat tone is appropriately aspirational, and the modus operandi largely anecdotal. Keith’s prefatory tale of the McCahon acquisition is followed by innumerable stories of Henderson’s own purchasing coups and triumphant sales. By palpably fulfilling the promise of an insider’s guide, this stream of stories simultaneously amounts to the memoir of a successful art dealer.

The book opens with “A Brief History of the Art Market”, stressing the shaky origins of art dealership in New Zealand, the gradual rise of specialist art auctioneers, and phenomena such as the art fairs pioneered by Henderson in the 1980s. In light of the strong sales of Peter McIntyre’s paintings at recent auctions, Peter Webb’s 1984 denunciation of this artist’s “diluted post-Impressionistic style” reminds us that modernist polemic may not offer the surest investment guide. In the second chapter, “Building a New Zealand Art Collection”, Henderson firmly prescribes wide reading, establishing a relationship with a dealer, and some hard thinking about your budget. The intricacies of the auction, that most intimidating of the art world’s ritual spaces with its blazing inscription Buyer Beware! are very helpfully outlined. Henderson strongly counsels against online purchasing but is enthusiastic about using websites for educational purposes.

“Art Investment”, the use of art as a “financial instrument”, introduces us to the notion of primary and secondary markets, and the subtleties and insecurities of artistic reputation. Henderson identifies the “baby boomer” market as a dominant force, so, if you are able to determine what will appeal to the later baby boomers, your investments could be assured. This leads into “How to Find a Bargain”, which opens with a revealing story of the teenage Henderson accompanying his schoolteacher father to Variety Auctions in Dominion Road where they uncovered a major painting by Charles Blomfield. The chapter’s epigraph from Goethe, “What a man does not understand, he does not possess”, refers to what Henderson senior inculcated, namely the tenacity and talent to distinguish “the gem from the common rock”.

“Fakes, Forgeries and Flops” introduces us to tricky notions, including provenance and authenticity. If Henderson were to have his way, “all fakes and forgeries would be put in a large pile and burned”. While the problem of the fake is indeed a serious risk in the market, especially in relation to high-end artists, the threat pales when compared with a more deadly and far more pervasive entity ‒ the “art flop”:

Flops appear at charity art auctions, school art auctions, amateur art exhibitions, cheap import retailers, on café walls, and the well-known e-commerce sites such as TradeMe and eBay. Art flops can also on occasion be discovered in gallery art exhibitions.


The art flop is the disastrously unfashionable work that no one wants, the art world’s equivalent of tainted goods. According to Henderson, art flops clog every level of the market, and the task of the collector is to shun them. Later chapters of the book cover such subjects as the conservation of art (state of preservation being intimately tied to value), and advice to artists on cultivating a relationship with a dealer.

The book is in need of some decisive editing, not only to eradicate repetitions and to ensure correct citations and spellings (Peter Tomory’s famous inflammatory statement is rendered as “Goldie was no Gaugin”), but also to help push the text beyond anecdotage and into more critical reflection on the nature of art consumption. In the context of art investment, Henderson makes passing reference to a mysterious “Veblen effect”, but fails to link this notion to its originator. American sociologist Thorstein Veblen is best known for The Theory of the Leisure Class (1899), an entertaining critique of capitalism that introduced the notion of conspicuous consumption. This is the acquisition of luxury goods specifically in order to flaunt your wealth, a behaviour witnessed at competitive auctions where the winners publicly translate mere money into objects of great status and are frequently applauded on their winning bid. Veblen’s theory helps us to understand the phenomenon whereby stratospherically high prices achieved for works by Goldie or McCahon only serve to make such objects even more desirable. When your acquisition is headlined in the newspaper, this is certain confirmation that you’re experiencing the ownership of a different calibre of capital.

In Bricabracamania: The Bourgeois and the Bibelot (1985), a study of high-end shopping, Rémy Saisselin explores how the work of art became a force for sublimating money into a different form of wealth: “A new form of class distinction has arisen, cleverly hidden not only from the masses but, best of all, from the educated middle class: the foundation of class distinction on the possession of original works of art.” Massive accumulations of money are essentially devoid of meaning, and the flagrantly conspicuous consumption of expensive art that is so central to the lifestyles of oligarchs and fashionistas is equally meaningless. Real collecting is arguably something entirely different and far less fashionable, especially the collecting made possible through the cultivation of a keen eye (as opposed to an expensive advisor) that is capable of operating at any level of the market. The stamina involved in such a visual education should not be underestimated.

Behind the Canvas usefully documents, from a dealer’s perspective, the late-20th-century metamorphosis of art collecting in New Zealand from a genteel hobby into a lucrative investment activity. What that might mean was revealed in 2012, when Milly Paris sold a portion of the immense collection she had accumulated with her late husband, Les Paris. Their collection of contemporary New Zealand art, which had been crowded into a modest Wellington home, was the result of a passionate pastime rather than an investment strategy. The highly hyped auction at Auckland’s Art + Object nevertheless realised a cool $4.5 million, of which almost $1 million was spent by Te Papa on four “key” works by New Zealand artists. If you are keen to begin transmuting mere money into something potentially far more valuable, you could do worse than follow Les’s and Milly’s example by looking widely and intensively at exhibitions, getting to know dealers and artists and, slowly but surely, developing your own taste.


Roger Blackley teaches a course on collecting in the art history programme at Victoria University of Wellington.


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