Artists Are Entrepreneurs. We Should Compensate Them Accordingly
Resale royalties exist to try to fix a structural problem—namely, that artists have historically been excluded from the financial upside when their work is resold in the secondary market. According to our research, letting artists participate in this upside can be better achieved through a mechanism that would give them fractional equity in their own work, rather than today’s resale rights regimes.
In recent Artsy editorials, Christopher Sprigman and Guy Rub, law professors at New York University and Ohio State, respectively, argue against resale royalties, while Mark Waugh, director of business development for the Design and Artists Copyright Society (DACS), the British rights clearance agency, argues for the resale right. While we understand the positive impact resale royalty payments have had on artists in the U.K., we fundamentally disagree with Sprigman and Rub’s argument that artists do not deserve or need this seeming handout. We approach this issue from a new perspective, that of property rights.
Our system follows from the logic of property rights, which—as we have written previously (Whitaker 2014, Whitaker 2018, Whitaker and Kräussl 2018)—rebuts Sprigman and Rub’s critique (and Rub’s 2014 Yale Law Journal Forum essay arguing that resale royalties are undue subsidies to artists). Resale royalties may continue to exist, especially in Europe as part of the moral rights of the artists, but the U.S. copyright system is based on the economic incentive to innovate. Especially in the U.S., but also more broadly, fractional equity is a better system. And today, it is enabled by new technologies such as blockchain.
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