Measuring Cultural Value

Alan FreemanUniversity of

Manitoba

Our paper draws on experiences of three analysts working in cultural policy and research– Hasan Bakhshi at NESTA, visiting professor at City

University– Alan Freeman at GLA– Graham Hitchen at LDA

For my part, working within the framework of ‘Creative Industries’– Three creative industry reports for Greater London– Cultural Audit of London

What was missing?

Policy, policy, policy:– Evidence but as yet no methodology – Policy-makers cannot yet take decisions informed it– Risk of ‘pseudo-positivism’

Reasons– I think we still don’t understand how arts markets

work– Relation between creativity and innovation not

understood • (Discussion: http://mpra.ub.uni-muenchen.de/9007/ )

– Very little information about non-market sector

‘Instrumental’ vs ‘Intrinsic’ as the arts sector sees it

“The gathering of evidence about the impact of the sector has assumed centre stage in the management of the subsidised cultural sector in England. It is closely associated with an extension of government control over the sector, and the tendency to value culture for its ‘impact’ rather than its intrinsic value.”

(Selwood 2002)

“Too often politicians have been forced to debate culture in terms only of its instrumental benefits to other agendas. . . . In political and public discourse in this country we have avoided the more difficult approach of investigating, questioning and celebrating what culture actually does in and of itself “

(Jowell 2004)

“[A] growing sense of unease pervades the cultural sector as it sets about justifying its consumption of public money. Instead of talking about what they do – displaying pictures or putting on dance performances – organisations will need to demonstrate how they have contributed to wider policy agendas such as social inclusion, crime prevention and learning.”

(Holden 2004:13)

Is the value of art measurable at all?

Intrinsic benefits of the arts are intangible and difficult to define. They lie beyond the traditional quantitative tools of the social sciences, and often beyond the language of common experience. Although many advocates of the arts believe intrinsic benefits are of primary importance, they are reluctant to introduce them into the policy discussion because they do not believe such ideas will resonate with most legislators and policymakers…the arts community is expected to focus on tangible results that have broad political backing, such as improved educational performance and economic development.  (McCarthy et al 2004:37)

A summary

Creative industries approach is ‘instrumental’– Arts engagement has ‘merit in its own right’– Arts should not be judged on non-artistic effects

More fundamental: measurement as such damages our ability to appreciate the real value of art– The intrinsic value of art is not quantifiable– Insofar as it is quantifiable, it is multi-dimensional– The intrinsic value of art is subjective

These criticisms apply to the use of economics: not

economics itself

Cultural economics has established a methodology to take into account the intrinsic value of art

– Concepts (eg existence, option, heritage benefits)– Measurement methods (eg CVM, WTP)– Research methods– Expertise and a community of practitioners

(discussion http://mpra.ub.uni-muenchen.de/14902/)

Economics is ‘at home’ with subjective valuation and intrinsic value

An obstructed (and obstructive) debate

Cultural economics was not being referred to in the policy-making field

– Particularly at regional and local level

Arts community and policymakers ignorant of a body of knowledge which

– accords with the criticisms voiced – is rooted in established economic theory

Failure to make use of this has led to – retreat from dialogue – a tendency to 'special case' arguments

Cultural economics – a well-defined tradition

Ruskin – artistic labour as a source of value

1910, special issue of Volkswirtschaftliche Blätter

Bruno Frey (2004) Arts & Economics: Analysis & Cultural Policy

Baumol and Bowen (1966) The Performing Arts – the Economic Dilemma

Thomas Moore (1968) ‘The American Theatre’

Alan Peacock and Ronald Weir ‘The Subsidised Muse’

Mark Blaug (1976) first book of readings

Throsby and Withers (2004) ‘The Economics of the Performing Arts’

Ruth Towse (2004) A Handbook of Cultural Economics

At least major journals of cultural economics

JEL classification ‘Z’

Revealed (commercial) value

“You are a clever, generous man, Dymov,” she used to say, “but you have one very serious defect. You take absolutely no interest in art. You don't believe in music or painting.”

“I don't understand them,” he would say mildly. “I have spent all my life in working at natural science and medicine, and I have never had time to take an interest in the arts.”

“But, you know, that's awful, Dymov!”

“Why so? Your friends don't know anything of science or medicine, but you don't reproach them with it. Every one has his own line. I don't understand landscapes and operas, but the way I look at it is that if one set of sensible people devote their whole lives to them, and other sensible people pay immense sums for them, they must be of use. I don't understand them, but not understanding does not imply disbelieving in them.”

(Chekhov, The Grasshopper)

Stated (Public) Value

Contingent Valuation (Willingness to Pay)– Work in progress– Sufficiently accepted to be used to value

environmental impacts, eg Exxon Valdez 1989– Many criticisms (cf Spash)– But established methodology

Subjective Wellbeing (‘Happiness’)– Well supported by DCMS and others– Links to ‘value of sport’

NOTE: the two procedures do not produce the same results

A field for research Highly relevant to new REF ‘impact’

requirement Prized by policymakers and evaluators

Nobody says ‘stated value’ measurement is a perfected standard

BUT a price is to be paid if it is eschewed on these grounds

Valuation methodologies are not perfect. But

– They provide ‘policy commensurability’ – Permit allocation across expenditure headings on common criteria

To say this is inappropriate for the arts, is actually to say the arts are a special case

But everything is ‘special’ – for example education. – Are the arts ‘more special than others’?– (at least, as regards making claims on the public purse)– If metrics are wrong for the arts, why are they right for education?

And: we still need to say what that case actually isFinally: is the real fear that the arts will lose funding?

– But if the public really values art, proper research should reveal this. If the results are wrong, we may need better research, not no research

– Exemption makes the arts vulnerable to ‘anti-special case’ arguments– Exemption lays the arts open to the charge of non-transparency

The risks of arts exemption

A research agenda

“We are capable of shutting off the sun and the stars because they do not pay a

dividend. London is one of the richest cities in the history of civilization, but it cannot

“afford” the highest standards of achievement of which its own living citizens are capable, because they do not “pay”. If I had the power today I should surely set out

to endow our capital cities with all the appurtenances of art and civilization on the highest standards of which the citizens of each were individually capable, convinced

that what I could create, I could afford – and believing that the money thus spent would not only be better than any dole, but would

make unnecessary any dole.”

(John Maynard Keynes)

Can we afford to fail?