How is the value of an oil painting determined?

An old tree and a younger one, oil on canvas by Ashok M.

Many wonder at the huge price of works of arts like some oil paintings on Canvas that are auctioned by leading auction houses from time to time while they find other works of art in a flee market going for a few dollars, some that seem just as nice or nicer.

How is the value of a work of art fixed? An answer to this can be found if we go back to the beginnings of human civilization. At first, humans traded goods in kind, for example a sack of grains for an animal skin. In time however humans invented coins and currency that were easier to carry to the market. A sack of gain was considered equivalent to a certain number of coins as was an animal skin. Thus based on the demand and supply of goods, monetary values were determined for all the things humans need.

The invention of money also permitted humans to accumulate and store wealth in a compact manner. In time similar values became associated with precious metals such as gold and silver, precious jewels etc. that do not rust or corrode easily and thus can be kept for generations. When worn as jewellery, one can wear them and show off and perhaps look pretty too. While jewels can adorn a body, art objects can adorn value of homes and palaces as well as also become a means of storing wealth. Humans have placed a high value on certain chosen art objects.

While the value of a coin is controlled by governing authorities, the value of art objects is controlled by public perception about that value. They have placed a high value on some oil on Canvas paintings such as the Mona Lisa and on the works of certain artists, not necessarily because they are the best works of art that are around but simply because that is how public opinion developed. Certainly the chosen works have to be professional enough so that the paint does not peal of or change adversely in a few years for then it would be worthless as an object for wealth. In order to be assured if it is so, it is best for the painting to be an old one, at least a decade or so old. Most certainly the painting must have enough aesthetic, emotional or intellectual impact so that the owner may display it proudly on one of his walls if he so desires. Most important it should be original, authentic and unique for if it is mass produced it cannot have any substantial value unless it is a currency note for which a government assigns a value. This requires that the work is authenticated and certified by a highly reputed auction house, art establishment or the artist himself/herself if alive.

There are times when a rich benefactor in order to find an excuse to reward an artist has purchased a work of art for a huge amount and that became its starting value and there are other times when an artist sold his works for a pittance but because they had a long life, they acquired a huge value as they changed hands.In the ultimate analysis however an artist invests a part of his life and soul in a work of art and it is this determines its value.

If a work is never sold then it has an unknown or zero value. This author has also produced some oil paintings as a diversion from his professional career form time to time. Because it was not necessary to sell these for a living, he has not made any serious attempt to sell them. This author has destroyed most of his works on canvas as he went along  feeling it is not a nice idea to clutter the world with works of arts that are not the best but a few have been gifted and around half a dozen framed to adorn the walls of his own home as the one shown in the photo with this post. How much would I sell it for if someone asked for it? I came up with the figure of 125,000 Dollars so that has to be around the value of this oil painting if sold, unsold or gifted.