The Economics of Art Thefts: Too Much Screaming over Munch's The Scream

The theft of Munch's The Scream in 2004 fired up a debate over museums’ protection policies because of the low level of security and the lack of any insurance against theft. In this paper we provide a rationale for the choices made by the Munch's museum. More generally, we show how diverting expenses in security and insurance to investments over the notoriousness of their collections reinforces the protection of Museums’ properties. This is because of two counter-intuitive effects: (1) investments in precautions, while reducing thieves’ profits, may adversely attract them towards works of art of higher value; (2) insurance may actually increase the incentive to steal works of art for the purpose of ransom. © 2010 The Economic Society of Australia