Monday, January 3, 2011

Artists as Entrepreneurs

After having heard Israel Kirzner at the FEE seminar on Advanced Austrian Economics, it occurred to me that the idea of the entrepreneur might be a good approach to understanding what it is that artists do, and why. Of course, one of the benefits of looking at this idea through economics is that you know if you have succeeded or not as an entrepreneur: you made profits, or not. Definite feedback. However, how does an artist know if she or he has succeeded or is succeeding? We have artists who are considered important artists who did not succeed in the market, and we have market successes that end up not lasting long within the artistic order.

Mises points out that "Profit-seeking speculation is the driving force of production" (Human Action, 325-6). How would we have to redefine "profit" to make it apply to the artistic order? What is it that artists qua artists are after in creating their work?

Hayek is interested in how the market facilitates mutual learning among people so that they end up maximizing their knowledge. How can we apply this insight to what artists do? What is it that artists are trying to learn in what they do? Can what they do be called "mutual learning"? Might this be a way to understand various artistic movements? More, Hayek shows that competition is a discovery process. Within the arts, we indeed see artists becoming most creative when they considered themselves in competition with others. Are there institutions which can foster more competition among artists?

Kirzner says that "The theory of entrepreneurial discovery sees the explanation of market phenomena in the way entrepreneurial decisions, taken under disequilibrium conditions bring about changes in prices and quantities. The market process so initiated consists of continual entrepreneurial discoveries; it is a process of discovery driven by dynamic competition, made possible by an institutional framework which permits unimpeded entrepreneurial entry into both new and old markets. The success which capitalist market economies display is the result of a powerful tendency for less efficient, less imaginative courses of productive action, to be replaced by newly discovered superior ways of serving consumers - by producing better goods and/or by taking advantage of hitherto unknown, but available, sources of resource supply. The theory focuses on the concept of discovery in contrast to the notion of the individual decision of mainstream theory" (How Markets Work, 31).

As the last sentences indicates, the Austrian approach is much more open to being applied to other social processes, such as artistic production. Artistic production, done properly, is a process of discovery, not a "decision." How can the above language be modified to apply to artistic production and, thus, to the artistic order?

How can we combine these insights to understand the artistic order? These are the questions I need to work through. It will be interesting reading more Kirzner on entrepreneurship.

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