Archives for 2014

Suppose the costs of putting on a show fall - this could be from falling rental rates for performance spaces, technological changes that reduce costs of lighting or sound, or falling labor costs (perhaps through policy changes that lower the cost of providing health insurance to employees). How will this affect ticket prices? In the short run, not at all. In the long run, ticket prices will fall. Let me define 'short run' as the time period over which the production schedule for the company is set: the performance dates for the rest of the … [Read more...]

Two articles this week on price discrimination by airlines, both written in the context of how crummy the low-priced options are. Slate's Alison Griswold writes: In a paper published last summer on strategic consumer behavior, a pair of researchers found that advance, online purchases of discounted airline tickets were disproportionately made on higher-cost carriers. The finding, they wrote, “suggests that fares at the lowest percentiles are often sufficiently low regardless of the presence of strategic consumers, and that increased … [Read more...]

Diversity - in audiences, employees, and boards of trustees - matters to arts administrators, and to researchers who study organizations and societies. But how do we measure diversity? The diversity index is constructed like this: suppose everybody comes from one of four different population groups: Blue, Green, Purple and Red. Let the fraction of the population that is Blue be given by B, the fraction that is Green be given by G, and so on, where B, G, P and R are all numbers between zero (if nobody comes from that group) and one (if … [Read more...]

No. But Christopher Knight at the LA Times thinks they should: Yes, every art museum needs multiple sources of revenue. It does cost money to run the place. However, because they are tax exempt, art museums already count the public as a major, indirect source of revenue. Required admission fees add a second hit — a kind of "double jeopardy" — and it is one that falls harder on those who can least afford it. But being tax exempt is not an indirect source of revenue. Exemption from the property tax is one less cost to bear, but all the other … [Read more...]

The car-sharing service Uber uses dynamic pricing (also called surge pricing): prices rise in response to local excess demand (where the demand for rides at the current price exceeds the supply of cars), and fall in response to local excess supply (where there are more cars available at the current price than there is demand for them). Uber's sharp increase in prices in Sydney, where there was a sudden significant excess demand for cars as the result of a downtown hostage taking, has sparked a debate on the morality of dynamic pricing. It's not … [Read more...]

The Guardian reports on various theatres in England experimenting with pay-what-you-decide pricing - essentially passing the hat at the end of the show - as a means of attracting new audiences and 'breaking down barriers.' ... the initiative is less about simply removing the financial barrier than removing the financial risk, which are two quite different things. After all, if people know that they want to see something, they will often find the money. It’s when they are uncertain about a show that they are less willing to take a risk … [Read more...]

On the weekend the New York Times had an article from Clyde Haberman, a brief history of musicians' earnings in the digital age. It included this (now oft-reported case): ... thus far, the people who create the music on which others build their fortunes often receive mere rivulets of reward. Not everyone is a Beyoncé or a Taylor Swift (who has removed her entire oeuvre from Spotify to keep it behind a pay wall). Many more musicians are like Zoe Keating, a cellist from Northern California who described her situation in detail last year. Over a … [Read more...]

A country that provides all residents, regardless of employment status, with health insurance, presents a vastly different environment for artists than one that does not. I wrote about this recently, in the context of the November election. Whether painters, writers, and actors can try to 'make it' in their calling without having to track down the sort of employment that comes with health insurance as a benefit is, in the grand scheme of things, a lot more valuable than whether the budget of the state arts council rose by five percent or not. … [Read more...]

Well, Pomplamoose might not have made any money on tour, but band member Jack Conte's accounting of revenues and costs has sure generated a lot of discussion, and hopefully more people who know about the band. My last post was about the fact that it has always been a tough way to make a living, but here I want to address an issue that has surfaced: is the fate of Pomplamoose, doing everything right (maybe) and still not generating net earnings a microcosm of the middle-class in America, increased inequality, and a winner-take-all economy? At … [Read more...]