Beyond Price: Value in Culture, Economics, and the Arts

Reviewed by Diane Ragsdale

Beyond Price: Value in Culture, Economics, and the Arts; Edited by Michael Hutter and David Throsby; Cambridge University Press, 2007, 324 pages

The art that matters to us … is received by us as a gift is received. Even if we have paid a fee at the door of the museum or concert hall, when we are touched by a work of art something comes to us that has nothing to do with the price.
— Lewis Hyde

While most would probably agree with Lewis Hyde, and perhaps even extend the sentiment to say that the “something” to which he refers is “valuable,” arts funders and politicians have increasingly considered this “something” an inadequate justification for financial support and have put demands on arts organizations to justify their efforts in terms of economic and instrumental impacts (e.g., revitalized communities, raised SAT scores, and jobs created).

For the past four years one question has dominated countless reports, meetings, and articles in the GIA Reader: What is the value of art, and how can it be measured? From my perspective, this most recent round of the conversation (I recognize it’s been going on for eons) was largely re-energized by the release of the 2004 Wallace Foundation-funded RAND report, Gifts of the Muse: Reframing the Debate about the Benefits of the Arts, and the subsequent article by Alan Brown in the Spring 2006 issue of the GIA Reader, “An Architecture of Value.”

Now comes Beyond Price: Value in Culture, Economics, and the Arts, a new volume edited by economists Michael Hutter and David Throsby, which makes significant contributions to the conversation on value in the arts. It speaks to practitioners and scholars (humanists and economists). Specifically, the book examines the nature of the twin concepts of cultural value and economic value; how they are formed; and how they do (or do not) relate to one another. This work is distinguished from other studies on the topic by its scope (it approaches value in the arts from diverse theoretical and historical perspectives and across a range of artistic disciplines); its commitment to moving beyond the rigid disciplinary confines within which scholars often work; and its encouragement of interdisciplinary communication and dialogue.

In addition to an introduction by the editors, the book is composed of sixteen papers by an impressive group of international scholars and policy makers, which are grouped into five sections.

  1. Origins of Meaning
  2. The Creation of Value in Artistic Work
  3. Continuity and Innovation
  4. Appreciation and Ranking
  5. Cultural Policies

Each paper in the book is worthwhile and makes a unique contribution to the whole—from Terry Smith’s fascinating paper on the relationship between meaning and value in the production and marketing of Australian Aboriginal art to Bill Ivey’s bold perspective that valuation in the arts currently rests in two extremes only, the popular (“art-as-commodity”) and the precious (“art-is-what-you-need-even-if-you-don’t-want-it”). It would be impossible for me to do justice to each of the contributions, but I will highlight just a few.

In his paper, “What Values Should Count in the Arts? The Tension between Economic Effects and Cultural Value,” economist Bruno S. Frey goes straight to the heart of the ongoing debate between economists and “arts people” (Frey’s term). Frey reports that, surprisingly, “arts people focus more on the economic effects of the arts than economists do” and “arts economists concentrate more on the artistic aspects than arts people do.”

He explains that arts people are fond of using economic impact studies as a way of demonstrating impact, in part because they “take the artistic value as given,” and in part because, as noted above, politicians and others seem to value them. Economists, generally speaking, prefer willingness-to-pay or contingent valuation studies, which help put a dollar figure on the value the public places on the arts.

While these two perspectives have tended to become polarized, Frey asserts that not only are they complementary, both are necessary. Arts people need to recognize that if they want public subsidies, then they need to allow for the accounting of the public’s perceptions of the value of art; willingness-to-pay and contingent value studies are one way to do this. Likewise, economists need to acknowledge that the political process must be taken into account; the reality is that economic impact studies are expected and are at times necessary to produce support for the arts (the most recent successful bid to secure economic stimulus money for the arts being a notable example).

Frey is not the only contributor in Beyond Price who attempts to bridge diverse theoretical perspectives. Richard Shusterman’s “Entertainment Value: Intrinsic, Instrumental, and Transactional,” investigates the concept of entertainment and looks at its complex relationship to art. This chapter was compelling to me in large part because funders often place art in opposition to entertainment and promote the viewpoint that art is sacred, entertainment crass, and that if something is enjoyed by the masses it must not be art. Shusterman calls the notion of intrinsic value problematic and challenges the idea that it is dichotomous with instrumental value. He also writes persuasively about the merits and importance of pleasure, its relationship to meaning/understanding, and its value in enhancing or completing the reception of art. He provides an example of this in T. S. Eliot, who wrote, “It is certain that we do not fully enjoy a poem unless we understand it; and on the other hand, it is equally true that we do not fully understand a poem unless we enjoy it. And that means, enjoying it to the right degree and in the right way, relative to other poems.”

Several of the essays in Beyond Price, including Shusterman’s, provide useful historical context for current discussions, some demonstrating that we’ve wrestled with how to talk about the value of the arts for centuries. In “Art, Honor, and Excellence in Early Modern Europe,” Elizabeth Honig examines the period of time when assigning value to art objects shifted from the “gift-reward” or “honor” system (in which it was unacceptable for an artist to ask for a fee and artworks functioned as reifications of social relationships) to the “marketplace” system. Honig describes an “antimarket discourse of valuation” that emerged in art writing from this period. She asserts that this new language was created because writers (correctly) perceived that value making in the arts was threatened by the growing influence of the marketplace.

Honig’s essay seems particularly relevant now as arts organizations suffer the consequences of allowing the economic value of the arts to dominate the discussion for years, if not decades. As Oskar Eustis, a leading thinker in the arts and artistic director of The Public Theater in New York City wrote a few years back in a letter to me, “Over the [past] 30 years, the American nonprofit theater has been operating in an economic environment that increasingly has valorized the market as the primary, almost exclusive, way of measuring value. Even when they have been most brilliant and successful, there has been real cost: a narrowing of the social and artistic agenda, and a diminishing of the vigor, bravery, diversity, and importance of the American theater.”

Beyond Price demonstrates that no single argument can fully capture the total value/contribution of the arts and that a joint perspective is needed. Arts people may no longer be able to assume that Hyde’s “something” that has “nothing to do with the price” can be taken as a given and may need to form stronger “antimarket” arguments for the arts. As counterintuitive as it sounds, it’s the economists who may have the most effective methods for doing this.

In their 2009 paper “Measuring Intrinsic Value: How to Stop Worrying and Love Economics,” Hsan Bakhashi, Alan Freeman, and Gretchen Hitchen echo this point saying, “Cultural economics strengthens the case for the arts in ways that have not been taken seriously until now.” They go on to suggest that the arts “stop insisting that intrinsic benefits cannot be measured, and start demanding that they should be.” The value and impact studies that Alan Brown at WolfBrown has done with the Major University Presenters and many other organizations and communities seem to be a great step in this direction.

Having said this, we cannot assume that improved methods for measuring and discussing the value of the arts will cause the arts to be more valuable or relevant to their communities. This is a separate issue, and a critical one. The most recent NEA report on arts participation trends in the US indicates double-digit rates of decline for theater, ballet, opera, orchestras, jazz, and visual arts festivals since 1982; faring only slightly better, museum participation rates are basically on par with 1982, though they have been declining since 2002. Even those who are college educated (a demographic with historically high participation rates) are curbing their attendance.
Better language will not solve our declining participation problem. Intellectual relevance cannot be relegated to the PR department. On the other hand, if we could significantly increase participation, if the arts truly mattered to more people, I wager we would find it less difficult to make a compelling case for the value of the arts.

Questions for David Throsby

In conjunction with writing an essay in response to Beyond Price: Value in Culture, Economics, and the Arts, edited by Michael Hutter and David Throsby, I had the opportunity to ask David Throsby a few questions via e-mail, to which he graciously responded. What follows
is a portion of that exchange.
— Diane Ragsdale

Ragsdale: David, if you were a funder and needed to assess the value of an arts organization to a local community, or to the field-at-large, how would you do so? Or, put another way, do you have any advice for arts funders who are trying to assess value? Do we need to change our practices; and if so, how?

Throsby: When we look at arts production/consumption/participation from the funding point of view, I think we have to go back to first principles and ask, what are the objectives of support from government or foundations? Why do they do it? And the reasons are usually multiple but do come down to support for making things happen that the market won’t support. That does mean that artistic, cultural, and other non-financial criteria should, in principle, take precedence over purely economic ones. The trend towards boosting the economic contribution of the arts was, as you know, brought on by the arts industry itself during the eighties and nineties, and maybe over the long run it has backfired somewhat in that it has tended to focus the attention of funders rather too much on the monetary. Of course, funders are concerned about the financial sustainability of the organizations they support, but perhaps there’s a case for some recalibration of the funding formulae. On the matter of including cultural value in the funding criteria, I’m all for a broad-ranging concept of value, to include things like contribution to social cohesion and community development, and not just a question of “pure” artistic values. On the assessment of value in this broader sense, one has really two sources (a) the well-informed judgments of arts professionals, and (b) the views of the population at large. Different people will put all the emphasis on one or the other—arts professionals themselves will often argue solely for (a) on the grounds that the public doesn’t know what’s good for them, whilst others claim that (b) is more “democratic.” In my view neither is correct, and a balance of the two should ideally be sought as a guide to decision-making.

Ragsdale: When did politicians, funders, and other arts stakeholders begin looking for the arts to have economic and instrumental impacts? Has this been an issue since the beginning of arts funding or is this a relatively recent phenomenon? If the latter, do you think that, in the US, the shift may have been (at least in part) in reaction to declining arts participation (as has been documented in the most recent report from the NEA)?

Throsby: I’m not sure that the US experience of a secular decline in arts consumption is mirrored in other countries. But taking the US case as it is, I don’t know that I would want to link declining participation with a shift in objectives or directions of funding I’m not sure how a causal relationship could be specified, though it’s an interesting hypothesis that could be tested somehow. What I would say is that in my experience politicians have ALWAYS been interested in the civilizing aspects of the arts and the role of government in supporting the arts for cultural reasons that aren’t related to their economic contribution. I really don’t think this has changed and that when it is put to the politicians in terms of a public responsibility, like education, they will readily accept it. What has apparently changed is that the arts community has been spooked by the perceived need to talk up the economic aspects and have been much too reticent about arguing the case direct to politicians from a purely cultural point of view. Of course, the whole case may not be made this way; once again it is a question of balance. But I think the arts advocates need to get the balance back on track.

Ragsdale: Over the past few years US arts organizations and their advocates have been increasingly focused on finding the right language to persuade people of the intrinsic value of the arts (after years of focusing on economic impact studies). Is this the way to “get the balance back on track”?

Throsby: I don’t think it is so much a question of persuading people of the intrinsic value of the arts, but rather of understanding more about what people can gain from the arts, how they can best be introduced to the arts, how their tastes can be encouraged and developed. This does suggest, from a policy angle, that more needs to be done on the consumption side to foster access and engagement, though this is easier said than done.

David Throsby holds Bachelors and Masters degrees from the University of Sydney, and a PhD in Economics from the London School of Economics. He has been Professor of Economics at Macquarie University in Sydney since 1974. He has authored several books, including Economics and Culture (2001).

Diane Ragsdale is associate program officer for the performing arts, the Andrew W. Mellon Foundation. Her viewpoints are personal and should not be taken to be those of the Foundation.