profit prejudice art culture

Profit and prejudice: alliances between art and economy exist

by Marianna Fatti.

Why an alliance between Art and Economy can exist – yes, beyond profit.

Many people get disturbed when combining the world of Art and Culture with Business and Economics. It seems that either no relationship among the two variables exists, or that the two worlds are considered as antagonists. In reality, unexpected bonds exist between these apparently rival worlds. Indeed, they can help each other.

An undervalued resource 

How can Economy help Art? In particular, how can businesses help cultural heritage? Cultural heritage is a public good, and by definition, private companies are not interested in investing in them because there is no profit to get from them – at least directly. So beside souvenirs’ selling or correlated services, there is theoretically no reason why businesses should invest in cultural heritage, at least according to the neo-classical theory of maximization of profit.

Moreover, let us consider the Italian case. Despite the fact that there are 1.7 museums or similar items every 100 km2 (ISTAT, 2015), representing a fundamental “strategic resource”, the Report on Equal and Sustainable Welfare of ISTAT for the 2016 highlights that public institutions do not consider the patrimony as worthy of investment. The public expense in safeguard and promotion of cultural heritage in 2015 only counts for the 0.07% of the GDP, and from 2014 it has been reduced by 6.6%. So how can Italy’s enormous artistic patrimony survive, if also investments from the public institutions are decreasing?

Economy helping Art

Here businesses enter to the stage. Their contribution to the preservation of cultural heritage is increasing thanks to a series of measures, which the Government is developing in order to promote and simplify this type of investment.

The most advertised and direct instrument to incentive private investments is the so called Art Bonus ( all those subjects who make a donation to preserve and restore specific monuments and museums indicated by the Ministry , but also support foundations, theatres and similar institutions, will benefit of a tax credit of the 65% of the donation. Patrons can be individual citizens but also companies.

The students of the Master in Economics and Management of Art and Cultural Heritage of the 24 Ore Business School have recently presented the results of the first study on Art Bonus, and these are definitely positive. Donors by 22th December 2016 were 3,836, with a 21,5% increase from 30th September 2016, which was the reference day for the end of the study.  The total amount collected by 17th December was 133 mln euros (Pirelli, 2016), and the greatest portion of this amount comes from companies and bank foundations, namely the 80% – 97,6 mln euros.

True love

One could argue about the selflessness of the donations, considering the relevant tax credit. Nevertheless, fiscal benefits seem to represent just a trigger. ISTAT’s report shows that the indicator “Dissatisfaction for the condition of the landscape” is increasing, and according to a research of 2009 by Centro Studi Gianfranco Imperatori, only the 15% of donors claim that it donate only because of a tax credit (Bagli, 2014).

Art Bonus takes advantage of the strategic trend of Corporate Social Responsibility, which comes as a blessing on national and local cultural institutions, which have seen their budget so drastically cut during the recent years. The amount of credit for companies is claimed to be even insufficient, considering that it only amounts to the 0.5% of the annual income. Companies seem to donate mostly because of two main characteristic of the instrument: its transparency and the strong relation with the local environment and community.

Art supporting Economy

Here we come to the second perspective, Art – in fact, cultural heritage – helping Economy. Common  goods like this are non-rivalrous, that is consumption of an individual does not prevent another one from consuming it and, in many case, they are non-excludable, and this is evident with monuments (Benhamou, 2013).

Nonetheless in her book of 2013 The Economy of Culture Françoise Benhamou, highlights another important, peculiar aspect: the marginal utility of the “consumption of culture” actually increases with the consumption. Becker and Stiegler call these “addictive goods”.

Van der Borg and Russo even propose, in a study of 2009, a model of “Culture-oriented economic development”, based on the network of all those economic, non-economic and institutional actors that stem from a cultural attraction, like cultural heritage. This cluster represents not only a source of employment itself, but it shall also be able to generate “value relationships” among actors and attract the related so-called creative industries, generating synergies among different resources and thus boosting the overall economic system

The difference between a PC and a Michelangelo’s statue

So why does almost everyone perceives such a strong dichotomy – if not contrast – between Art and Economy? The president of Italian UNESCO Youth Committee once made this example. The difference between hitting with a hammer a PC and the statue Pietà by Michelangelo Buonarroti – it actually occurred in 1972, when Lazlo Toth damaged with a hammer the face of the Virgin Mary – is that in the latter case it would be practically impossible to quantify the damage.

Indeed, a realistic estimate of their value would be almost impossible, because – true – works of art are unique masterpieces. For this reason and for most of them are public, anyone should be able to enjoy this unique materialisation of human soul. Any attempt to calculate their value would implicitly transform art in a marketable product.

However, while there cannot be any objective quantification of the value of cultural heritage, the benefits it determines for the economic system can definitely be estimated, thus encouraging further public and private investments, feeding not only the cultural system, but the economic one as a whole living happily ever after.


Marianna Fatti, enrolled in the first year of the Master of Science in Government and International Organisations at Bocconi University, is a nextPA member since September, 2016.

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