All Commentary
Friday, January 1, 1999

Artistic Freedom Requires Economic Freedom

Capitalist Wealth Supports Artistic Production

Tyler Cowen is a professor of economics at George Mason University. This article is taken from In Praise of Commercial Culture, published by Harvard University Press. Copyright © 1998 by the President and Fellows of Harvard College. All rights reserved.

Psychological motivations, though a driving force behind many great artworks, do not operate in a vacuum, independent of external constraints. Economic circumstances influence the ability of artists to express their aesthetic aspirations. Specifically, artistic independence requires financial independence and a strong commercial market. Beethoven wrote: “I am not out to be a musical usurer as you think, who writes only to become rich, by no means! Yet, I love an independent life, and this I cannot have without a small income.”

Capitalism generates the wealth that enables individuals to support themselves through art. The artistic professions, a relatively recent development in human history, flourish with economic growth. Increasing levels of wealth and comfort have freed creative individuals from tiresome physical labor and have supplied them with the means to pursue their flights of fancy. Wealthy societies usually consume the greatest quantities of non-pecuniary enjoyments. The ability of wealth to fulfill our basic physical needs elevates our goals and our interest in the aesthetic. In accord with this mechanism, the number of individuals who can support themselves as full-time creators has risen steadily for centuries.

Perhaps ironically, the market economy increases the independence of the artist from the immediate demands of the culture-consuming public. Capitalism funds alternative sources of financial support, allowing artists to invest in skills, undertake long-term projects, pursue the internal logic of their chosen genre or niche, and develop their marketing abilities. A commercial society is a prosperous and comfortable society, and offers a rich variety of niches in which artists can find the means to satisfy their creative desires.

Many artists cannot make a living from their craft, and require external sources of financial support. Contrary to many other commentators, I do not interpret this as a sign of market failure. Art markets sometimes fail to recognize the merits of great creators, but a wealthy economy, taken as a whole, is more robust to that kind of failure in judgment than is a poor economy. A wealthy economy gives artists a greater number of other sources of potential financial support.

Private foundations, universities, bequests from wealthy relatives, and ordinary jobs, that bane of the artistic impulse, all have supported budding creators. Jane Austen lived from the wealth of her family, T. S. Eliot worked in Lloyd’s bank, James Joyce taught languages, Paul Gauguin accumulated a financial cushion through his work as a stockbroker, Charles Ives was an insurance executive, Vincent van Gogh received support from his brother, William Faulkner worked in a power plant and later as a Hollywood screenwriter, and Philip Glass drove a taxi in New York City. William Carlos Williams worked as a physician in Rutherford, New Jersey, and wrote poetry between the visits of his patients.

Wallace Stevens, the American poet, pursued a full-time career in the insurance industry. “He was a very imaginative claims man,” noted one former colleague. When offered an endowed chair to teach and write poetry at Harvard University, Stevens declined. He preferred insurance work to lecturing and did not wish to sacrifice his position in the firm. At one point a coworker accused Stevens of working on his poetry during company time. He replied: “I’m thinking about surety problems Saturdays and Sundays when I’m strolling through Elizabeth Park, so it all evens out.”

Parents and elderly relations have financed many an anti-establishment cultural revolution. Most of the leading French artists of the nineteenth century lived off family funds—usually generated by mercantile activity—for at least part of their careers. The list includes Delacroix, Corot, Courbet, Seurat, Degas, Manet, Monet, Cézanne, Toulouse-Lautrec, and Moreau. French writers Charles Baudelaire, Paul Verlaine, and Gustave Flaubert went even further in their anti-establishment attitudes, again at their parents’ expense.

Even the most seclusive artists sometimes rely furtively on capitalist wealth. Marcel Proust sequestered himself in a cork-lined room to write, covering himself in blankets and venturing outside no more than 15 minutes a day. Yet he relied on his family’s wealth, obtained through the Parisian stock exchange. Paul Gauguin left the French art world for the tropical island of Tahiti, knowing that his pictures would appreciate in value in his absence, allowing for a triumphal return. Gauguin never ceased his tireless self-promotion, and during his Pacific stays he constantly monitored the value of his pictures in France.

Wealth and financial security give artists the scope to reject societal values. The bohemian, the avant-garde, and the nihilist are all products of capitalism. They have pursued forms of liberty and inventiveness that are unique to the modern world.

Pecuniary Incentives

Many artists reject the bohemian lifestyle and pursue profits. The artists of the Italian Renaissance were businessmen first and foremost. They produced for profit, wrote commercial contracts, and did not hesitate to walk away from a job if the remuneration was not sufficient. Renaissance sculptor Benvenuto Cellini, in his autobiography, remarked, “You poor idiots, I’m a poor goldsmith, and I work for anyone who pays me.”

Bach, Mozart, Haydn, and Beethoven were all obsessed with earning money through their art, as a reading of their letters reveals. Mozart even wrote: “Believe me, my sole purpose is to make as much money as possible; for after good health it is the best thing to have.” When accepting an Academy Award in 1972, Charlie Chaplin remarked: “I went into the business for money and the art grew out of it. If people are disillusioned by that remark, I can’t help it. It’s the truth.” The massive pecuniary rewards available to the most successful creators encourage many individuals to try their hand at entering the market.

Profits signal where the artist finds the largest and most enthusiastic audience. British “punk violinist” Nigel Kennedy has written: “I think if you’re playing music or doing art you can in some way measure the amount of communication you are achieving by how much money it is bringing in for you and for those around you.” Creators desiring to communicate a message to others thus pay heed to market earnings, even if they have little intrinsic interest in material riches. The millions earned by Prince and Bruce Springsteen indicate how successfully they have spread their influence.

Beethoven cared about money as a means of helping others. When approached by a friend in need, he sometimes composed for money: “I have only to sit down at my desk and in a short time help for him is forthcoming.” Money, as a general medium of exchange, serves many different ends, not just greedy or materialistic ones.

Funding Artistic Materials

Artists who chase profits are not always accumulating wealth for its own sake. An artist’s income allows him or her to purchase the necessary materials for artistic creation. Budding sculptors must pay for bronze, aluminum, and stone. Writers wish to travel for ideas and background, and musicians need studio time. J. S. Bach used his outside income, obtained from playing at weddings and funerals, to buy himself out of his commitment to teach Latin, so that he would have more time to compose. Robert Townsend produced the hit film Hollywood Shuffle by selling the use of his credit cards to his friends. Money is a means to the ends of creative expression and artistic communication.

Capitalist wealth supports the accouterments of artistic production. Elizabethan theaters, the venues for Shakespeare’s plays, were run for profit and funded from ticket receipts. For the first time in English history, the theater employed full-time professional actors, production companies, and playwrights. Buildings were designed specifically for dramatic productions. Shakespeare, who wrote for money, earned a good living as an actor and playwright.

Pianos, violins, synthesizers, and mixers have all been falling in price, relative to general inflation, since their invention. With the advent of the home camcorder, even rudimentary movie-making equipment is now widely available. Photography blossomed in the late nineteenth century with technological innovations. Equipment fell drastically in price and developing pictures became much easier. Photographers suddenly were able to work with hand cameras, and no longer needed to process pictures immediately after they were taken. Photographic equipment no longer weighed 50 to 70 pounds, and the expense of maintaining a traveling darkroom was removed.

Falling prices for materials have made the arts affordable to millions of enthusiasts and would-be professionals. In previous eras, even paper was costly, limiting the development of both writing and drawing skills to relatively well-off families. Vincent van Gogh, an ascetic loner who ignored public taste, could not have managed his very poor lifestyle at an earlier time in history. His nonconformism was possible because technological progress had lowered the costs of paints and canvas and enabled him to persist as an artist.

Female artists, like Berthe Morisot and Mary Cassatt, also took advantage of falling materials costs to move into the market. In the late nineteenth century women suddenly could paint in their spare time without having to spend exorbitant sums on materials. Artistic willpower became more important than external financial support. This shift gave victims of discrimination greater access to the art world. The presence of women in the visual arts, literature, and music has risen steadily as capitalism has advanced.

Falling costs of materials help explain why art has been able to move away from popular taste in the twentieth century. In the early history of art, paint and materials were very expensive; artists were constrained by the need to generate immediate commissions and sales. When these costs fell, artists could aim more at innovation and personal expression, and less at pleasing buyers and critics. Modern art became possible. The impressionists did not require immediate acceptance from the French Salon, and the abstract expressionists could continue even when Peggy Guggenheim was their only buyer.

The artist’s own health and well-being, a form of “human capital,” provides an especially important asset. Modernity has improved the health and lengthened the lives of artists. John Keats would not have died at age 26 of tuberculosis with access to modern medicine. Paula Modersohn-Becker, one of the most talented painters Germany has produced, died from complications following childbirth, at the age of 31. Mozart, Schubert, Emily Brontë, and many others who never even made their start also count as medical tragedies who would have survived in the modern era. The ability of a wealthy society to support life for greater numbers of people, compared to premodern societies, has provided significant stimulus to both the supply and demand sides of art markets.

Most advances in health and life expectancy have come quite recently. In the United States of 1855, one of the wealthiest and healthiest countries in the world at that time, a newly born male child could expect no more than 39 years of life. Yet many of the greatest composers, writers, and painters peak well after their fortieth year.

Birth control technologies, generally available only for the last few decades, have given female creators greater control over their lives and domestic conditions. Most of the renowned female painters of the past, for various intentional or accidental reasons, had either few children or no children at all. Childbearing responsibilities kept most women out of the art world. Today, budding female artists can exercise far greater control over whether and when they wish to have children. The increasing prominence of women in music, literature, and the visual arts provides one of the most compelling arguments for cultural optimism. For much of human history, at least half of the human race has been shut out from many prominent artistic forms, and women are only beginning to redress the balance.

Do the Arts Lag in Productivity?

William Baumol and William Bowen, two economists who have analyzed the performing arts, believe that economic growth imposes a “cost disease” on artistic production. They claim that rising productivity causes the arts to increase in relative cost, as a share of national income. The arts supposedly do not enjoy the benefits of technical progress to equal degree. It took 40 minutes to produce a Mozart string quartet in 1780, and still takes 40 minutes today. As wages rise in the economy, the relative cost of supporting the arts will increase, according to this hypothesis.

Contrary to Baumol and Bowen, the evidence suggests that the arts benefit greatly from technological progress. The printing press, innovations in paper production, and now the World Wide Web have increased the availability of the written word. The French impressionists drew their new colors from innovations in the chemical industry. Recording and radio, both capital technologies, have improved the productivity of the symphony orchestra. Symphonic productions now reach millions of listeners more easily than ever before. These technological improvements are not once-and-for-all events that only postpone the onset of the cost disease. Rather, technological progress benefits the arts in an ongoing and cumulative fashion.

The cost disease argument neglects other beneficial aspects of economic growth. The arts benefit more from technological advances than it may at first appear. Production of a symphonic concert, for instance, involves more than sitting an orchestra in a room and having them play Shostakovich. The players must discover each other’s existence, maintain their health and mental composure, arrange transportation for rehearsals and concerts, and receive quality feedback from critics and teachers. In each of these regards the modern world vastly surpasses the productivity of earlier times, largely because of technological advances.

Mechanisms in Support of Artistic Diversity

Well-developed markets support cultural diversity. A quick walk through any compact disc or book superstore belies the view that today’s musical and literary tastes are becoming increasingly homogeneous. Retail outlets use product selection and diversity as primary strategies for bringing consumers through the door. Even items that do not turn a direct profit will help attract business and store visits, thereby supporting the ability of the business to offer a wide variety of products.

The available variety of artistic products should come as no surprise. Adam Smith emphasized that the division of labor, and thus the degree of specialization, is limited by the extent of the market. In the case of art, a large market lowers the costs of creative pursuits and makes market niches easier to find. In the contrary case of a single patron, the artist must meet the tastes of that patron or earn no income.

Growing markets in music, literature, and the fine arts have moved creators away from dependence on patronage. A patron, as opposed to a customer, supports an artist with his or her own money, without necessarily purchasing the artistic output. Samuel Johnson, writing in the eighteenth century, referred to a patron as “a wretch who supports with insolence, and is paid with flattery.” Even Johnson, however, did not believe that patrons were intrinsically bad; the problem arises only when artists are completely dependent upon a single patron. Patronage relationships, which today stand at an all-time high, have become more beneficial to artistic creativity over time. The size and diversity of modern funding sources gives artists bargaining power to create space for their creative freedom.

Growth of the market has liberated artists, not only from the patron, but also from the potential tyranny of mainstream market taste. Unlike in the eighteenth century, today’s books need not top the bestseller list to remunerate their authors handsomely. Artists who believe that they know better than the crowd can indulge their own tastes and lead fashion. Today it is easier than ever before to make a living by marketing to an artistic niche and rejecting mainstream taste.

In the realm of culture, market mechanisms do more than simply give consumers what they want. Markets give producers the greatest latitude to educate their audiences. Art consists of a continual dialogue between producer and consumer; this dialogue helps both parties decide what they want. The market incentive to conclude a profitable sale simultaneously provides an incentive to engage consumers and producers in a process of want refinement. Economic growth increases our ability to develop sophisticated and specialized tastes.

Payola and Cultural Diversity

The payola scandals provided a dramatic episode in the clash of musical worlds. Independent record companies frequently used payola to promote rock and roll on American radio. Payola occurs when a disc jockey is paid by record companies or music publishers to play certain recordings. This practice, usually considered scandalous, in fact helped new musicians gain airplay. Payola combated conformism and racism in the music business. Nonetheless rock and roll opponents succeeded in making payola a dirty word akin to bribery or money laundering.

The first documented instances of payola date from England in the 1860s. The publishers of sheet music paid vaudeville artists to sing and popularize their songs. Payment of these fees was a normal marketing procedure for publishers and a significant source of income for performers; payola occasioned no political scandal. Prior to the payola scandals, payola had been an accepted and legal business practice used to promote new products for many decades. In the case of rhythm and blues, the independents lacked the reputations and marketing power to place their artists through name alone, and were forced to rely on payola.

Chuck Berry’s “Maybellene,” his first hit and still one of his most popular songs, was given initial airplay because of payola. Leonard Chess of Chess Records (Berry’s record company) went to well-known disc jockey Alan Freed with a large catalog of material. Chess offered Freed partial songwriting credits on any song of his choice, provided that he would play and promote the song. Freed now had a stronger incentive to pick the best song and to promote it. After listening to hundreds of recordings, Freed picked “Maybellene.” Berry became a star, and the Freed estate continues to receive royalties (check your record label). When record companies believed they had a sure-fire hit by an unknown singer, they used payola to buy air-time for the record.

Payola does not differ from the ordinary purchase of advertising time. Instead of hearing a jingle, we hear a song. The song itself, and the performer, is being advertised. Outlawing payola kept radio stations from advertising music, the commodity of greatest interest to their audiences.

Payola also encouraged disc jockeys, the individuals who knew most about music, to discover new talent. The station owners were not as well informed as the disc jockeys and did not have the same ground-level contacts in the musical world, especially for rock and roll. The proliferation of independent record companies made new stars harder to find, increasing the importance of disc jockey middlemen. If a disc jockey found a new star, the disc jockey would receive some of the benefits in the form of payola income.

Payola income decreased disc jockey favoritism and racial discrimination. When disc jockeys receive additional income from playing the more popular product, they are less inclined to indulge their own personal and racial biases, and more inclined to heed the wishes of consumers. The value of giving airplay to a good song, and thus its payola value, is usually higher than the value of promoting a bad song. Record companies were not interested in paying to procure airtime for likely duds.

Critics of payola argued (correctly) that payola gave a special boost to rock and roll. Outlawing payola increases the importance of advertisements as a source of radio station income. The radio station will play music to attract listeners who purchase advertised products–middle-class and upper-class Americans. When payola is legal, the desire to increase payola income encourages the station to attract listeners who will buy records. Payola gave record buyers–the young, the die hard music fans, and the followers of rock and roll–greater influence over station programming.

The payola scandals were part of the ASCAP [American Society of Composers, Authors, and Publishers] campaign against BMI [Broadcast Music Incorporated] and rock music. After an ASCAP antitrust suit against BMI failed, the music publishers sought another legal weapon to use against their competitor. ASCAP also wished to strike out against the disc jockeys who had neglected to promote their music. In late 1959, ASCAP persuaded Congress to launch an investigation of payola for rock and roll, rhythm and blues, and soul music.

The discriminatory nature of the payola hearings belies their origins. Responding to ASCAP pressure, the House Committee examined payola for rock and roll only, not payola for classical music. The government came down much more heavily on “black payola” than “white payola.” Alan Freed, the deejay who pushed gritty rock and roll and raucous black music, was prosecuted and found his entire career ruined. Dick Clark, of American Bandstand fame, used payola to promote more respectable forms of white pop. Clark’s “violations” were more striking but he was left with his career and media empire intact.

At the end of the Committee hearings, Congress outlawed payola, with a jail term of up to one year and a $10,000 fine for convicted offenders. Earlier, the Federal Communications Commission had threatened to suspend the license of any radio station found guilty of accepting payola. Amazingly, when the payola hearings started, payola was not in violation of any Federal law. The investigations were primarily a witch hunt directed against particular kinds of music that did not meet with universal approval.

—Tyler Cowen