In recent years, some English critics have claimed that Damien Hirst and his fellow young British artists have made London the new center of the advanced art world. As Hirst reaches the age of 40, this paper uses auction results to measure the importance of the YBAs compared to their American peers. Auction prices show that the YBAs do rule over their American rivals: both Hirst and Chris Ofili have had individual works sell for more than $1 million, a level no American artist under 40 has achieved. Whether London can continue its success will depend in part on whether it can match New York’s ability to attract important artists born in other countries.

The recent history of modern art provides clues as to how important artists can be identified before their work becomes generally known. Advanced art has been dominated by young conceptual innovators since the late 1950s, and theimportance of formal art education in the training of leading artists has also increased during this period. In the United States, a few schools have been particularly prominent. Auction market records reveal that during the past five decades the Yale School of Art has produced a series of graduates who have achieved great success commercially as well as critically. Recognizing Yale’s role can allow collectors to identify important artists before they become widely recognized, and therefore before their early innovative work rises in value.

Earlier research found that great painters can be categorized either as young geniuses, who make sudden conceptual innovations early in their careers, or as old masters, who work experimentally, by trial and error, and arrive at their greatest contributions late in their lives. This paper extends this analysis to literature, and shows that the same dichotomy applies to both poets and novelists. Thus great conceptual writers, including T. S. Eliot and F. Scott Fitzgerald, have peaked early and declined thereafter, whereas great experimental writers, such as Robert Frost and Virginia Woolf, have produced their most important work later in their careers. The likelihood that both patterns exist not only in all the arts, but in all intellectual activities, poses a challenge to economists, who have not studied life cycles of creativity. Understanding the life cycles of great innovators may help us to increase the contributions of some of the most productive members of our society.

A quantitative analysis of the illustrations in art history textbooks reveals that the most important modern American painters—including Pollock, de Kooning, and Warhol—failed to produce individual paintings as famous as the masterpieces of some major French modern artists, such as Manet, Gauguin, and Seurat. Yet art historians do not consider the American artists to be less important and less innovative than their French predecessors. The absence of American masterpieces instead appears to be a consequence of market conditions, as changes over time in the primary methods of showing and selling fine art effectively eliminated the incentive for artists to produce important individual works. The study of markets is essential to a full understanding of the development of modern art.

There have been two very different life cycles for great modern artists: some have made their major contributions early in their careers, while others have produced their best work later in their lives. These patterns have been associated with different artistic goals and working methods: artists who peak late are motivated by aesthetic considerations and work by trial and error, whereas artists who peak early are motivated by conceptual concerns and plan their work in advance. This paper applies this analysis to the careers of the leading members from the two generations of painters who made New York the center of the art world in the 1950s and ‘60s. The results not only yield a new understanding of the life cycles of creative individuals, but also provide new insights into the rationale behind the prices paid for works of art at auction.