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Arts funding in New Zealand: a proposal for reform

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The article outlines the current system of central government financial support for the arts in New Zealand and critiques this on the basis of the nature of the market failures that justify public support in principle. It is noted that the design of arts funding systems is a neglected topic in Cultural Economics, despite the relatively large sums involved and the unevenness of their disbursement. In New Zealand, on average, more than 40 cents of public money is handed over to arts producers for every dollar that the sector earns in the private market (the “box-office”), but with huge variations for different art categories. Nearly all support is directed at the supply side of the arts, whereas the principles of public finance suggest that funding should be ex post, topping-up revenues earned from the sale of art in the market. The article develops the mechanics of a performance-based arts funding system.

Keywords: New Zealand; externalities; performance-based arts funding

Document Type: Research Article


Affiliations: Department of Economics, University of Auckland, Auckland, New Zealand

Publication date: March 1, 2011


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