Page title

Intro

Executive summary

Artistic and cultural organisations are increasingly being required to justify the funding they receive through the direct benefits associated with their activities. This poses a challenge for the arts community as their primary drivers are not necessarily quantifiable (e.g. the delivery of high-quality artistic experiences, provoking thought or developing artistic ability). Despite significant progress in impact research, there remains a sense that the sector lacks robust methodologies for demonstrating the contribution of artistic and cultural activities to wider social and economic policy goals and the scale of their contributions.

This Social Impact study identifies and quantifies social benefits in the broader community that are generated through participation or attendance at artistic and cultural activities. These benefits are commonly referred to as instrumental impacts. They encompass different impact domains (economic, social, civic, cultural and environmental1). This study is focused on social instrumental impacts. The pathways by which social impacts are realised has been captured in a predictive model that associates the social impacts with the activity (stimulus) that created it.

When people interact with artistic activities, they have experiences, thoughts and feelings that can be described as intrinsic outcomes. Intrinsic outcomes have been successfully identified through a large body of research (McCarthy et al 2001; Holden 2004, 2006, 2009) and can be measured through the Public Value Measurement Framework (PVMF) dimensions developed by Culture Counts and former WA State Government Department of Culture and the Arts. Artistic and cultural activities stimulate intrinsic responses such as increased self-belief, self-empowerment, sense of belonging and other outcomes that contribute to the improved social wellbeing of a person. Through these intrinsic changes, there can be associated positive social instrumental impacts. An extensive literature review was undertaken to identify positive social impacts clearly linked to artistic and cultural activities. The review covered a diverse spectrum of studies and identified three main social instrumental impacts that have the potential to be quantified (Figure 1). The diagram shows the measurable social outcomes, which are health, education and social capital

Further research aligned intrinsic outcomes with the identified instrumental impacts and selected current PVMF dimensions and new dimensions were identified that create a link between the two.

The necessary evidence was identified to estimate the potential impact associated with the schedule of artistic and cultural activities conducted by the department’s funded organisations.

Valuation methods were assessed, and a model created to monetise the impact associated with these activities. PVMF dimension results from 2016 were used to estimate the intrinsic value from the art consumers point of view and establish the final estimate of value for the Department.

Quantifying the health, education and social capital impacts of artistic and cultural activities is achieved through the following steps:

  • Establishing a base case (i.e. the schedule of artistic and cultural activities that would have been achieved without Department funding)
  • Finding scientific evidence of an impact (e.g. a causal relationship between dancing and self-assessed health)
  • Identifying the scale of the impact (e.g. % improvement in self-assessed health score)
  • Identifying the impacted population (e.g. persons 35 years and over)
  • Linking the impact to a financial proxy (e.g. research shows that higher self-assessed health scores indicate lower likelihood of visiting the GP)
  • Quantifying the financial proxies (e.g. $ cost of a visit to the GP)
  • Measuring the intrinsic impact of the funded organisations and applying it to derive the final estimated value.

Through the application of these steps it was possible to estimate the value of the impact from the department’s contribution to funded organisations (Figure 2).

Diagram shows the impact value pathways through health, education and social capital.

Total health benefits attributable to the department’s funding equate to $28 million. Education benefits total approximately $34 million and Social Capital benefits are estimated to amount to $5 million. It is estimated that the department’s funding provides a benefit to funding ratio of approximately 5 to 1. This indicates that for every dollar of funding provided by the department to funded organisations, there is approximately $5 of social instrumental benefit in the broader community.

While the model provides a conservative estimate of the impact that the department generates through the funded organisations, there are three main limitations to the application of these estimates:

  1. Benefit calculations are conservative:
    • Some benefits of artistic and cultural activities cannot be quantified
    • There are gaps in the available research that limit the number of benefits that can be quantified
  2. The benefits can be investigated by artform, but there is limited applicability to individual organisations due to the nature of the research (it is based on participation in artistic and cultural activities on an ongoing basis, not a single event or series of workshops)
  3. Opportunity costs were not considered (should funding be removed from artistic and cultural activities it could be used somewhere else – the benefits associated with other possible applications of the funding were not estimated.

Future development of the model should focus on improving the data inputs. The department should undertake regular reviews of available research on the social impact of artistic and cultural activities. The data collected from funded organisations should be adapted to meet the input requirements of the valuation model and the Culture Counts platform will need to be updated to include proposed dimensions.

Implementing the model will require the department to engage with representative stakeholders from various artforms. The process should be used to communicate the importance of developing value estimates to support the arts community to secure funding. The department should continue the work with the selected stakeholders to establish sets of core dimensions in the PVMF that can be used to provide art form specific measurements of intrinsic values that relate to instrumental impacts. This will provide more accurate value estimates of the department’s overall impact and enable the estimation of artform specific instrumental benefits. The ability to communicate the value statement of the department with an understanding of the contribution made by each artform is a significant step towards ensuring that the arts community is able to secure funding to maintain and potentially increase the availability of artistic and cultural activities in Perth and regional WA.

Footnote

  1. Cultural Development Network – www.culturaldevelopment.net.au/outcomes
Page reviewed 25 June 2019