The inability-to-capture-value problem isn’t just for art, it’s for basically everything. The idea that even monopolistic profit maximization gets that big a percentage of surplus is based upon all the customers being similar. For my favorite art (including music, movies, TV shows, books, blogs, etc), even I paid ‘full retail’ for all of them, I’d be paying multiple orders of magnitude less than my consumer surplus for them, which is why I don’t worry too much if 80-90% of my purchases (in both time and money) are duds.
There are two issues then. One is that the vast majority of marginal artists are not actually live to create something of net value, and producing more bad art is actively bad since it takes mindshare and market from good art, so taxation on the margin might still be good. So I think it comes down to how well-sorted artists are here. If the marginal artists are the ones on the verge of quitting tax is good, if not tax is bad.
(The other is that the same inability-to-capture applies to almost everything else that isn’t very commodified. I think I mostly bite that bullet and say that yes, we don’t properly encourage (and often actively discourage) doing non-commodity things that produce value, and that’s sad, with art just being a special case of that.)
Crowdfunding approaches as seen e.g. in Kickstarter or Patreon have recently made it a lot easier for artists to capture significant amounts of value for their efforts. (This could still be supplemented though, e.g. via after-the-fact prize awards for especially impressive art.) It’s interesting to think of what comparable approaches may be applicable to goods and services that are very much unlike art, and where value may nonetheless be hard to capture efficiently.
The inability-to-capture-value problem isn’t just for art, it’s for basically everything. The idea that even monopolistic profit maximization gets that big a percentage of surplus is based upon all the customers being similar. For my favorite art (including music, movies, TV shows, books, blogs, etc), even I paid ‘full retail’ for all of them, I’d be paying multiple orders of magnitude less than my consumer surplus for them, which is why I don’t worry too much if 80-90% of my purchases (in both time and money) are duds.
There are two issues then. One is that the vast majority of marginal artists are not actually live to create something of net value, and producing more bad art is actively bad since it takes mindshare and market from good art, so taxation on the margin might still be good. So I think it comes down to how well-sorted artists are here. If the marginal artists are the ones on the verge of quitting tax is good, if not tax is bad.
(The other is that the same inability-to-capture applies to almost everything else that isn’t very commodified. I think I mostly bite that bullet and say that yes, we don’t properly encourage (and often actively discourage) doing non-commodity things that produce value, and that’s sad, with art just being a special case of that.)
Crowdfunding approaches as seen e.g. in Kickstarter or Patreon have recently made it a lot easier for artists to capture significant amounts of value for their efforts. (This could still be supplemented though, e.g. via after-the-fact prize awards for especially impressive art.) It’s interesting to think of what comparable approaches may be applicable to goods and services that are very much unlike art, and where value may nonetheless be hard to capture efficiently.