The Economics of Masterpieces' Thefts: Too Much Screaming Over Munch’s Scream?
A Journal of Applied Economics and Policy, Forthcoming
Posted: 16 Feb 2010 Last revised: 20 May 2011
Date Written: February 5, 2010
The theft of Munch’s the Scream in 2004 fired up a debate over museums’ protection policies because of the low level of security and the lack of any insurance against theft. In this paper we provide a rationale for the choices made by the Much's museum. More generally, we show how diverting expenses in security and insurance to investments over the notoriousness of their collections reinforces the protection of Museums' properties. This is because of two counterintuitive effects: i) investments in precautions, while reducing thieves profits, may adversely attract them towards works of art of higher value; (b) insurance may actually increase the incentive to steal art for the purpose of ransom. Owners may take a third way: investing in famousness as this also reduces thieves' profit. The museum thus acts as a protection device by reducing the post-theft value of masterpieces, and under certain assumptions, this policy qualifies for being more cost-effective than precautions and/or insurance.
Keywords: Theft, Protection, Cutural Economics, Law and Economics
JEL Classification: K42, H23
Suggested Citation: Suggested Citation