Can Art Finance itself?
in: Wirtschaft im Wandel,
Until 2003, public savings in the art sector have been immense. But lately there has been a tendency of increasing public expenditures in this field. Nevertheless one has to ask if these allowances are required to sustain artistic and cultural life.
If, however, art cannot be financed by the contributions of their consumers, the question arises whether and to which extend the government should pay for it. In spring 2007, we realized a survey in cooperation with the “neue theater“ in Halle and the “Anhaltisches Theater Dessau“. Among other subjects, we asked the audience to evaluate the current ticket prices. As a result, we analyzed how these theatres could adjust their ticket prices in order to reduce the need of public subsidies. The conclusion of this survey is that the visitors are reacting rather weakly to moderate price increases. So it can be stated that the theatres could in fact boost their revenues by appropriately raising their ticket prices. Unfortunately, the resulting extra revenue is not sufficient to finance the performing arts without the help of public subsidies.
Finally, an additional argument for subsidizing art is that not only the customers benefit from it, but also the society as a whole because of so-called positive external effects.