Five years ago saw the monumental collapse of Lehman Brothers, a catastrophic event which completely hammered the global financial market. Meanwhile, Damien Hirst’s Sotheby’s bonanza set a new record for a one-artist auction, raking in £111 million.
You could perhaps look at these two incidences as being prescient of the world in 2013, where capitalism’s moral authority was revealed to be farcical, based as it was on complex mathematical equations that even its authors couldn’t understand, and where the art industry was shown to be something special, continuing to defy all logic against a backdrop of economic malaise.
The two are intertwined though, in a complex, non-linear, unspoken and fascinating way, and regardless of the fact that as exemplified above, the world of high finance and high art may render very different results, but they do, in part, need one another. Private investment, for example, is extremely important to supporting the arts.
It is interesting to note then that since the credit crunch, private investment in culture has grown and while it isn’t thriving, it is notable nevertheless. According to Arts & Business, there was a modest rise of 7.6 per cent for the period 2011-2012 but this is rather prominent when compared to investment made into the economy.
London continues to be the main benefactor, leading to ‘widespread concern’ that outside of the capital, investment in culture has been less distinguished, with many organisations ‘disproportionately affected by the recession’.
The total amount of private investment that went into arts and culture was £660.5 million, which is rather commendable. Broken down this works out as £372.9 million donated by individuals (up £22.9 million on the previous year’s figures); £173.8 million being gifted by trusts and foundations (up £23.7 million); and £113.8 million coming from business investment.
All in all, the outlook appears to be very good for private investment in the arts, which should further benefit from the economic recovery that is underway in the UK. Though this is still protracted and very much in its infancy, when coupled with the fact that capital has been steadily filtering into establishments across all art forms, the significance is palpable.
It is also worth noting that the arts sector has been hit hard by the government’s austerity cuts. If, for example, you were to take private investment out of the equation and you can begin to appreciate how helpful this income stream has been. Again, this goes to show how interdependent arts organisations are with all things pertaining to the financial sector. You need cash to innovate and develop and if you can’t generate funds in the normal way, then there is no alternative but to embrace private investment.
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