The Renaissance was underpinned by the support of bankers. Back then, as now, it resulted in strife and discord, as the art world struggled to reconcile its independence with its reliance on capital

MORALLY discredited bankers. Vast amounts of wealth concentrated in the hands of the few. Social chaos threatening to erupt. Corruption of the clergy at the highest levels. Sound familiar? This is a description not of Ireland today but of Florence at the height of its Renaissance glory.

More than 500 years later, we still haven't resolved the ambivalent relationship between art and money. Money and Beauty: Bankers, Botticelli and the Bonfire of the Vanities, an exhibition currently at Strozzi Palace in that city, demonstrates contemporary parallels at every turn. But what can an exhibition about historical attempts to buy beauty reveal about how, and why, things have become so confusing today?

The first golden florin was minted in Florence in 1237. Pure gold, it had the lily of Florence on one side; and an image of John the Baptist on the other, "politics and piety fused in gold", as Tim Parks, one of the exhibition curators, writes. From this starting point, Money and Beautyworks its way through the emergence of modern banking and the magnificent Medici as secular patrons of art, via the discovery of how to sidestep biblical prohibitions on usury (lending money at interest), and the rise to power of the firebrand monk Girolamo Savonarola. It concludes in 1510, with the death of Sandro Botticelli, the artist who had raised Christian painting to divinity but who threw his own paintings on Savonarola's Bonfire of the Vanities and who sacrificed his own later career to his belief that the values of money were destroying the values of spirituality and art.

Looking back, you begin to see why the church was so anti-usury, as it opened the door to the idea of money for money's sake rather than as an emblem of what it can create and do in the world. Money and Beautycleverly uses pairs of texts (in English) to give different opinions about the works and objects on display. So we read about the desire to "think of art as free from the contamination of lucre" and the way that fluctuating tensions between "a Divine summons to sobriety and an unbridled love of luxury . . . were incarnated in sublime works of art". It's a paradox that the system Botticelli came to distrust so much was the very same that gave rise to the Renaissance and the creation of some of the world's greatest paintings and sculptures.

Usury itself – the use of money to make money – with no production or transformation of goods; and currency exchange, the Florentine solution to church bans on it, are at the heart of today’s financial systems, and those who creatively practise it were until recently lauded as geniuses and feted as heroes in society. They also bought a great deal of art.

WALKING AROUND THEexhibition, one gravitates to famous names. Partly this is because painters such as Fra Lippo Lippi, Fra Angelico and Sandro Botticelli created transcendent canvases that draw you in to live in their worlds, but it is also a syndrome in modern museums. A painting on display has perhaps recently been bought for a record-breaking price, so you linger longer in front of it, trying to discover its worth. The price becomes part of its content and meaning, as market value systems override the subjective values of art.

This can be oddly comforting. In the art world, judgments of taste are held in the ownership of the few – museum directors, curators, some artists, one or two writers – and it’s not always clear to a wider public why one artist is lauded over another. On the face of it, money is more democratic; anyone can buy art, and anyone with sufficient wherewithal can become part of the art-world elite by spending huge amounts of cash. Even in today’s chaotic financial world, it’s easier to understand money than art. The new wealth flooding into Florence, and into the rest of Europe, fuelled by banking and trade, caused similar problems for the hierarchy.

From the creation of the gold florin on, the symbols of wealth – richly dyed clothes, golden accessories and jewels – became widely available and threatened to disrupt the rigidly segregated social class systems and the teachings of the church. Sumptuary laws were brought in to ban brazen displays of wealth. People naturally got around these, the wealthiest by simply paying the fines, which further enriched the coffers of Florence.

But perhaps the area where money bought the most beauty was in art.

Florentine bankers may have found loopholes in church law to enable their money-making, but they were still ambivalent about where that left them in the eyes of both God and society – and salved their consciences by commissioning art.

"Never," declared Cosimo de' Medici, "shall I be able to give God enough to set him down in my books as a debtor." Nevertheless, gold haloes adorned saints in religious paintings, the Virgin's cloak was painted ultramarine, the most costly pigment in the paintbox, and Medici faces appeared in religious frescoes, such as the Procession of the Magiin the Medici Riccardi Chapel. Botticelli's Madonna and Child, Two Angels and the Young St John(1468) sees the Virgin wearing what were then contemporary clothes. Beauty, once a path to the divine, became a worldly end in itself. "Were devotional paintings the first fashion-driven consumer product?" asks Parks. With the rise of secular wealth, money changed what God looked like and, by extension, what art looked like – and it is still doing the latter today.

In the end, wars weakened the power of the Medici, and into the vacuum stepped Savonarola, preaching a similar message to the Occupy movements around the world today. Anti-corruption, and fuelled by a sense of injustice as he watched ostentatious wealth grow in the hands of the few, as the many were driven further into poverty and misery, he found a receptive audience, and for three years he ruled Florence.

They were bloody years, with executions and burnings, not only of books and art but of people, and in the end Savonarola was burned himself, on the site of his infamous Bonfire of the Vanities. Strangely enough, despite his destruction of art, many artists, including Botticelli and Michelangelo, were influenced by him, and his spiritual teachings added new layers of spirituality to the qualities of their work.

He might have had a particularly violent way of going about things, although they were undoubtedly in tune with the times, but one of the things Savonarola was railing against was the monetisation of spiritual and emotional life. The ideas raised by Money and Beautyare so resonant today precisely because of this, and with 21st-century eyes we can look back to see where it all began.

Today, everything, including one’s reputation, has a price (as demonstrated in libel awards), and that price has become indistinguishable from its value. “We don’t have art movements any more,” writes the influential US critic Donald Kuspit. “We have market movements.”

Ultimately, however, exploring Money and Beauty, another layer of meaning emerges. At the other side of the ambivalence about art, wealth and spiritual values is a question that lies at the heart of one of the fundamental human drives: what happens next?

“Nobody wants to be remembered merely for their money,” writes Parks and, perhaps at the end of it all, art, money, religion and power are all seeking the same thing: some kind of belief in a future after death. Whether it is eternal life beyond this world or a permanent place within it, all seem to try to defy, or become talismans against, the inevitable passing of time. The pursuit of money as an end in itself has muddied one of our reasons for pursuing it, and that is the idea of legacy. You can’t take it with you, but art lets you at least attempt to leave something behind.

Buying beauty: Moments in the story of art and money

1675

Johannes Vermeer dies in debt. His wife, Catharina, sells two of his paintings to pay what they owe to the local baker. In 2004, a Vermeer, Young Woman Seated at the Virginals, which had long been considered a fake, is authenticated and sells at auction for £16.2 million.

1888

Vincent Van Gogh's The Red Vineyard sells for 400 francs. It is the only painting to sell during the artist's lifetime. Van Gogh wrote in that year, "Why, a canvas I have covered is worth more than a blank canvas. That – believe me my pretensions go no further – that is my right to paint, my reason for painting". In 1990, his Portrait of Dr Gachetsells at auction for $82.5 million.

1994

On the Scottish island of Jura, Bill Drummond and Jimmy Cauty of the K Foundation burn £1 million as an art project. In 2001, having failed to sell a Richard Long photograph that he had previously bought for $20,000, Drummond cuts it into 20,000 pieces, to sell for $1 each.

2006

Casino owner Steve Wynn and hedge fund manager Steve Cohen are about to make history as Wynn sells Cohen Picasso's Le Rêve. The $139 million price tag will make it the most expensive work of art ever sold. In an exuberant accidental gesture, Wynn put his elbow through the painting. The sale is called off and, following restoration, the painting is valued at $85 million. It is claimed that Wynn's insurance payout is more than the original price he paid for the painting.

2007

Damien Hirst's platinum and diamond skull, For the Love of God, which cost £14 million to produce, sells (according to Hirst) to a private consortium for £50 million. The consortium is revealed to include Hirst himself.

2011

The Australian artist Denis Beaubois sells his work Currencyfor 15,500 Australian dollars at auction. With the 22 per cent buyer's premium, the price is 21,350 Australian dollars. The work consists of a wad of 20,000 Australian dollars in cash – so it both costs more and is worth less than the sum of its parts. According to the auction notes, Currency"explores the tension between the economic value of the material against the cultural value of the art object".

Money and Beauty: Bankers, Botticelli and the Bonfire of the Vanities

is at the Strozzi Palace, Florence, until January 22nd. palazzostrozzi.org