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The Impact Of Government Funding On Private Contributions To Nonprofit Performing Arts Organizations

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  • Thomas More Smith

Abstract

ABSTRACT**: This paper tests the crowding‐out hypothesis for a balanced panel of nonprofit performing arts organizations between 1998 and 2003. This research uses a number of model specifications and estimating techniques to appropriately capture the relationship between government grants and private donations. Under alternative specifications, the relationship between government grants and private donations suggests crowding‐in between $0.14 and $1.15. The crowd‐in relationship does change according to art type: symphony orchestras and music companies experience a modest crowd‐in while dance and ballet companies experience a small crowd‐out. Although the crowd‐in falls to zero under the strictest condition, there is a lack of evidence of crowd‐out for nonprofit performing arts organizations as a group.

Suggested Citation

  • Thomas More Smith, 2007. "The Impact Of Government Funding On Private Contributions To Nonprofit Performing Arts Organizations," Annals of Public and Cooperative Economics, Wiley Blackwell, vol. 78(1), pages 137-160, March.
  • Handle: RePEc:bla:annpce:v:78:y:2007:i:1:p:137-160
    DOI: 10.1111/j.1467-8292.2007.00329.x
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    File URL: https://doi.org/10.1111/j.1467-8292.2007.00329.x
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    Cited by:

    1. Achyut Kafle & Stephen K. Swallow & Elizabeth C. Smith, 2015. "Does Public Funding Affect Preferred Tradeoffs and Crowd-In or Crowd-Out Willingness to Pay? A Watershed Management Case," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 60(3), pages 471-495, March.
    2. Angela Besana & Annamaria Esposito, 2017. "Memory, Marketing and Economic Performances in Usa Symphony Orchestras and Opera Houses," European Journal of Economics and Business Studies Articles, European Center for Science Education and Research, vol. 3, EJES Sept.
    3. Angela Besana & Annamaria Esposito, 2019. "Fundraising, social media and tourism in American symphony orchestras and opera houses," Business Economics, Palgrave Macmillan;National Association for Business Economics, vol. 54(2), pages 137-144, April.
    4. Lauren Schmitz, 2012. "Do Cultural Tax Districts Buttress Revenue Growth for Budding Arts Organizations?," SCEPA working paper series. SCEPA's main areas of research are macroeconomic policy, inequality and poverty, and globalization. 2012-1, Schwartz Center for Economic Policy Analysis (SCEPA), The New School.

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