Democratizing Art Markets: Fractional Ownership and the Securitization of Art

35 Pages Posted: 18 Jan 2018 Last revised: 26 Jan 2018

See all articles by Amy Whitaker

Amy Whitaker

New York University

Roman Kräussl

Luxembourg School of Finance; Hoover Institution, Stanford University

Date Written: January 11, 2018


Using unique historical sales data from the Leo Castelli Gallery, we introduce a novel model of evaluating art market returns using first-sale prices alongside auction results. We create a sample portfolio to analyze what would have happened if the artists Jasper Johns and Robert Rauschenberg had retained 10% equity in the work they sold through their dealer in the years 1958 to 1963, which was the start-up phase of the artists’ careers. We find that this retained-equity portfolio would have performed from 2.8 up to 140.8 times better (Rauschenberg) and from 24.9 up to 986.8 times better (Johns) than the S&P 500 over the same period. Modeling equity portfolios for artists changes the fundamental structure of art markets. Because the fractional equity is a property right under the Coase theorem, this system introduces a secondary market for shares in artwork. These shares could trade using a technology such as the blockchain and would allow more democratic and diversifiable access to investment in art markets. Our framework extends to other creative industries in which early-stage work is difficult to value.

Keywords: value creation and capture, art market, property rights, investment management, blockchain, venture funding

Suggested Citation

Whitaker, Amy and Kraeussl, Roman, Democratizing Art Markets: Fractional Ownership and the Securitization of Art (January 11, 2018). Available at SSRN: or

Amy Whitaker (Contact Author)

New York University ( email )

New York, NY
United States
917-476-7399 (Phone)

Roman Kraeussl

Luxembourg School of Finance ( email )

4, rue Albert Borschette
Luxembourg, 1246
+3524666445442 (Phone)


Hoover Institution, Stanford University ( email )

Stanford, CA 94305
United States

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