The contemporary art “boom” could be hurting museums’ bottom lines, Robert Ekelund, Eminent Scholar and Professor of Economics Emeritus at Auburn University, writes. Ekelund contrasts the experiences of New York’s Metropolitan Museum of Art (the Met), which is undergoing significant financial challenges, with the Museum of Modern Art (MoMA), which is “flush” with cash. “While the Met’s contemporary collection has grown somewhat in recent years, it has been unable to quickly adjust to the changing tastes of museum-goers, who increasingly favor modern and contemporary art. This has put it at a competitive disadvantage.

The economic point here is that if a museum like the Met isn’t able to keep up as its customers’ tastes change, revenue will likely fall. And by the time it might recognize this, it’s already too late to do much about it because the costs to acquire the in-demand art is sky-high.” Ekelund points specifically to the shift in bn’aires’ taste towards contemporary art: “In a world with about 1,800 billionaires, it only takes a relative few to drive high-end art prices to astronomical levels… soaring prices mean museums simply can’t keep up and must usually depend on donations to assemble portfolios of the best work, or they’re priced out.” Also making the problems more challenging are demographic issues that “have exacerbated the problems of museum finance and operations by putting pressure on the revenue side of the equation.”