Dr James Davies explores how to move beyond economic metrics to more holistically measure the social, cultural, and community value of cultural activities and interventions.
With the new Labour Government’s continued commitment to prioritising the Arts, Cultural and Creative Industries sectors as key drivers for the UK economy, there remains a need to consider the methodologies utilised in measuring and evaluating cultural activity and interventions. The Local Policy Innovation Partnership (LPIP) Hub’s Cultural Recovery Evidence Review spoke to a wider literature highlighting the reliance on economic measures to judge cultural interventions, initiatives and activities, and the under-appreciation of the myriad other forms of value that culture and cultural infrastructure can provide to places and communities in place.
In an earlier blog, I discussed the importance of delineating between cultural infrastructure and creative industries, in this piece, the aim is to offer some synthesising of frameworks and methodologies that can contribute to a non-market valuation, in addition to the traditional economic indicators of Gross Value Added (GVA) and employment
Understanding the Contribution of Culture
Culture is too often measured purely economically, but cultural activity offers many other forms of value. The problem arises in developing and adopting approaches that apply a framework to demonstrate and measure these different forms of value and step beyond the simple economic metrics. In reviewing the academic evidence on the impact of European Capitals of Culture (ECOC), Nermond et al. suggest little to no effect from cultural events on Gross Domestic Product (GDP) and jobs, with little impact on creative industries. While tourism demand increases temporarily, it is not sustained long-term. Economic development is often cited as a reason for the European Capital of Culture (ECOC), but social and cultural benefits are also important.
Additionally, the literature highlights issues with the economic rationale for cultural events, suggesting many non-economic justifications for these festivals. This pattern of economic prioritisation relates to large-scale events, like the ECOC, but also to smaller, more localised, and place-specific interventions.
Understanding the wide variety of physical assets that comprise a place’s cultural infrastructure (without even considering the non-physical networks, relational elements and connections that also contribute to the cultural infrastructure of a place) is crucial. As a part of their rapid evidence assessment (REA) of culture and heritage valuation studies, the Department for Media, Culture and Sport (DCMS) included the following:
- Archaeological assets (e.g. castles and ruins)
- Art engagement (including street art, festivals, library archives)
- Cultural institutions (Art galleries, museums, concert halls)
- Industrial heritage (including ports/docks, canals and mines)
- Historical amenities (sculptures, statues, gardens and parks)
- Religious assets (including cathedrals, mosques and synagogues)
Principles & Frameworks
The Centre for Cultural Value (CCV) offers a set of foundational principles and a framework to help design more nuanced approaches to evaluating cultural interventions. Based on four key values, the framework offers methodological guidance in ensuring an intervention is Beneficial, Robust, People-Centred and Connected. A summary of the four principles is found in the table below, and here is the full framework.
| Beneficial | Robust |
| – What do you want to learn that you don’t already know? – Is your evaluation ethical and delivered with integrity? – What difference does it intend to make? Does it do so in conjunction with those it impacts? | – Is your evaluation rigorous and grounded in empirical research? – Do clearly describe your methods, and use different types of data? – Is the activity open-minded and capable of learning from its failures? |
| People-centred | Connected |
| – Is your evaluation inclusive and representative of the communities you are working with?- – Does it seek out and include a wide range of voices and perspectives? – Is it co-created, with representatives of beneficiary groups? | – Is the activity transparent, and accessible to stakeholders and the wider public? – Is it aware of its context and situated in background literature and understanding of socially and culturally relevant factors? |
Additionally, the CCV offer a variety of toolkits and resources, including guidance on how to amplify diverse voices in research, how to develop people-centred learning collaborations and demonstration of their evaluation principles in practice, a sentiment echoed by research commissioned by UKRI.
DCMS’ aim with the Cultural and Heritage Capital Framework is to add guidance and resources that work in collaboration and addition to the principles for Social Cost Benefit Analysis (SCBA) published in HM Treasury’s Green Book, specifically for cultural interventions and assets.
SCBA requires benefits to be measured in monetary terms, but most evidence so far has been qualitative or focused on outputs, not on valuing outcomes and impacts. Past studies mainly assess value to individuals, highlighting the need for research on the broader value of culture and heritage. In the attempt to attach a wider range of value to cultural assets, DCMS propose considering both use and non-use non-market valuations of cultural assets, as shown in Table 2 below:
| Use Value | Non-Use Value | ||
| Value | Example | Value | Example |
| Direct use value: Any benefit that comes directly from engagement with a cultural asset | Visiting a museum or historical dock. | Existence value: Any benefit from knowing a cultural asset exists | Pride from knowing your place has a high-quality art gallery or theatre |
| Indirect use value: Any benefit that comes without directly engaging with the cultural asset | Civic pride from knowing your place is home to a renowned art collection | Bequest value: Any benefit from knowing future generations will have access to a cultural asset | The pride from knowing your children will have access to museums and galleries. |
| Option Value: Any benefit that comes from knowing a cultural asset can be used in future | The knowledge you could visit a museum in future. | Altruistic value: Any benefit from knowing a cultural asset is available to others | The satisfaction of knowing other people can experience a historic concert hall. |
‘Non-use’ values are underused in decision-making, despite them making up a substantial part of the value of culture and heritage assets. The challenge in applying methodological approaches that more holistically capture the wider variety of value inherent in cultural assets is communicating that value in a way that speaks to the language of funders and funding organisations, but which is also congruent with the lived experience of a place.
In their rapid evidence assessment, Lawton et al. highlighted a variety of alternative techniques for capturing this value, summarised in Table 3.
| Valuation Technique | Description |
| Revealed Preference / Hedonic Pricing | Valuations are derived from observable changes in behaviour in indirect markets, for example, the value of built heritage may be revealed indirectly in housing markets. |
| Contingent Valuation | Valuations are derived directly from asking people about their willingness to pay for/give up goods or services. For example, direct monetisation via a willingness to pay a hypothetical entry fee. |
| Well-being Valuation | Valuation is inferred from the relationship between well-being and income. Subjective, difficult to monetise and do not result in observable changes in market behaviour. |
| Travel Cost | Valuation is based on the amount of time and money people are prepared to pay for travel to consume a good or service. |
| Choice Modelling | Valuation is derived indirectly through peoples’ responses to a series of options |
As of 2021, the majority of studies used contingent valuation, but there is scope to build on the small number of hedonic valuations of culture and heritage assets, exploiting real estate data to value those types of culture and heritage assets that are amenable to hedonic pricing methods, notably heritage buildings and protected areas within urban zones. Additionally, there are a number of factors that affect the value of cultural assets themselves, including asset life and the length of policy or intervention. Cultural, and particularly heritage, assets can even increase in value as they become older and rarer, in direct opposition to accepted logic for most products and services.
The Challenge Remains
Whether the new Government will continue with the Culture and Heritage Capital Framework in its current form is uncertain, but the approach speaks to an ongoing balancing act in understanding and communicating cultural value. The myriad forms of social value that culture provides beyond the purely economic need to be understood, yet are notoriously difficult to measure and demonstrate. Doing so effectively requires the application of a balanced approach, blending high-resolution data sets with qualitative accounts of local actors and beneficiaries to see beyond the purely economic.
At the same time, methodologies that can place monetary value on non-market value help to better communicate with funders and central government in a language that is familiar. A change of government offers an opportunity to reappraise how cultural activity is measured, and offer centralised guidance and a standardised approach on how to do so. The challenge remains however how to reflect the lived experience of people and places within this scenario to bring a common framework of understanding for both policy and the people that it affects.
This blog was written by Dr James Davies, Research Fellow, City-REDI, University of Birmingham.
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Disclaimer:
The views expressed in this analysis post are those of the author and not necessarily those of City-REDI or the University of Birmingham.