The Value of Sound
By Mira Korber, guest blogger.
What comes to mind when you hear the name “Stradivarius?” It’s iconic, sacrosanct, “the best.” Even non-musicians know that.
Strads have long been considered among the greatest of all violins, holy artifacts from the golden age of instrument making (1600-1700s). With hopes of shedding light on the longstanding debate that Strads are truly better, a group of researchers from Université Pierre conducted a “double-blind” violin test.
A team of about 20 competent players compared two Strads, one Guarneri, and three contemporary instruments, and surprisingly indicated preferences far from consistent. (Interestingly, only three players correctly identified which were the instruments made hundreds of years ago.) However, the task at hand wasn’t exactly to decide which instruments were the old Italians, but to express partiality to one or another.
Read a personal account of the testing experience here.
The Economic Lesson
Positive externalities occur when a third party (or bystander) experiences a benefit from a transaction between another two individuals. Therefore, the social value of said transaction is actually larger than the private value.
Each sale of a masterpiece instrument creates a positive externality. Whether acquired through a syndicate, personal benefactor, or individually, more spectacular instruments on the stage means more audiences experience their greatness.
An Economic Question: Could you graph the positive externality of selling Strads the same way as when government subsidizes something else for the social good?