Applied Economics, 2011, 43, 619629

The demand for creative arts in regional Victoria, Australia

Tristan Mastersa, Roslyn Russella,* and Robert Brooksb
Department of Finance and Marketing, School of Economics, RMIT University, GPO Box 2476V, Melbourne, VIC 3001, Australia b Department of Econometrics and Business Statistics, Monash University, PO Box 1071, Narre Warren, VIC 3805, Australia
a

A healthy creative arts industry can contribute significantly to the economic and social fabric of a community. Unfortunately, regional areas often suffer from a lack of supply and demand for the creative arts. This article explores the demand for the creative arts in three regional locations in Victoria, Australia, using three broad dimensions of demand: attitudes towards the arts; frequency of participation in the arts and level of expenditure on the arts. The analysis of demand patterns uses the general modelling approach of Levy-Garboua and Montmarquette (1996) as a basis and makes use of the ordered probit class of models for its statistical analysis. The study confirms that individual levels of demand are contingent on a range of demographic characteristics and also identifies factors such as festival attendance and increased past creative arts expenditure as being important determinants of demand for the arts.

I. Introduction A significant volume of recent literature describes the benefits proffered by creative industries to towns and cities (see inter alia Landry and Bianchini, 1995; Scott, 1997; Landry, 2000; Beyers, 2002; Florida, 2002). Throsby (2001) identifies that such benefits can be direct or indirect in nature, and range from increased employment (Beyers, 2002) to urban revitalization (Throsby, 2001). Moreover, such creative cities are employing the arts as a lever which promote and sustain the creative and innovative nature of other industry sectors (Wood, 1999). The literature suggests that creative individuals are traditionally drawn to communities which stimulate creativity and promote diversity (Florida, 2002).
*Corresponding author. E-mail: [email protected]

Markusen (2006) provides a critique of the analysis of the creative class in Florida (2002). She argues that many of the occupations that make up the creative class as defined in Florida (2002) are clustered together on the basis of educational attainment and not creativity per se. McGranahan and Wojan (2007) also refine the definition of the creative class used by Florida (2002). When they focus their definition on excluding those occupations with a low-creativity requirement they find a stronger relationship between the presence of the revised creative class and regional economic growth. Markusen (2006) then focuses her analysis on a demonstrably creative subset of the set of occupations in the creative class, specifically artists. Markusen (2006) argues that artists provide a boost to regional growth via providing local consumption

Applied Economics ISSN 00036846 print/ISSN 14664283 online 2011 Taylor & Francis http://www.informaworld.com DOI: 10.1080/00036840802584976

619

620
opportunities for local residents and exports of artistic goods and services to nonresidents. Markusen and Schrock (2006) also argue that artists provide a significant boost to regional economic activity. Using data on an occupational basis, they find evidence of a significant artistic dividend across a range of the US cities and regions. Markusen (2006) discusses that the location decisions of artists are a function of their preferences, local efforts to facilitate artists livelihoods and concentrations of artist employing industries. In the Australian context Throsby and Hollister (2003) note that because infrastructure is largely based in capital cities, and that more employment opportunities exist in capital cities, a significantly higher concentration of arts professionals live in such an urban environment. A total of 73% of Australian artists live in Australias capital cities, 13% live in a regional town or city, 9% live in a semi-rural setting and the remaining 5% live in a rural or remote location. This represents a more significant difference when compared to statistics regarding the labour force more broadly, which shows 64% of Australias workforce to be living in capital cities, with the remaining 36% living in a regional, rural or remote location. State-based figures from Victoria suggest that, of those employed in cultural industries 82% were from Melbourne, compared to 18% from the rest of Victoria (Australian Bureau of Statistics (ABS), 1998). This article explores the potential role of the arts in rural and regional Victoria through an analysis of the demand for the creative arts in three locations in rural and regional Victoria. In addition to demonstrating empirical results regarding demand drivers for creative arts in a regional Australian context, this article adds to the extant literature which has regard to understanding audience characteristics for creative art events and artforms. The study of demand for arts in this article explores three broad dimensions of demand: (i) attitudes towards the arts; (ii) frequency of participation in the arts and (iii) level of expenditure on the arts. Our analysis of demand patterns uses the general modelling approach of Levy-Garboua and Montmarquette (1996) as its base, and makes use of the ordered probit class of models for its statistical analysis. Ordered probit analysis is seen to be a robust and versatile statistical test, which has had broad application from monetary policy (Gascoigne and Turner, 2004) and analysis of sovereign debt ratings (Afonso et al., 2009) to analyse the characteristics of renters and buyers of videotape movies in Spain (Collins et al., 2009). The plan of this article is as follows. Section II provides details of the survey data collection.

T. Masters et al.
Section III outlines the modelling approach. Section IV presents the results of empirical analysis. Section V concludes this article.

II. Data Collection Data was collected using a self-complete survey sent to randomly selected households in the three target regions and completed by a representative from each household. In addition to key demographic data, this survey instrument was designed to extract information relating to attitudes, frequency of participation and expenditure relating to arts and culture. Data collection took place in households across each of the three target regions selected for inclusion in this study, namely the East Gippsland, Shepparton and Mildura regions of Victoria. These three areas were selected to broadly represent the current arts environment of regional Victoria, in terms of their geographical position, size and other characteristics, which are presented in the summary below (Table 1). In relation to attitudes towards the arts, a threepoint attitudinal scale (agree, neutral or disagree) was used to measure response to eight statements regarding general attitudes towards arts and culture, as well as more specific questions relating to perceived benefits of the arts to the local regional economy, and other perceived impacts on the community. The measurement of attitudes is used in the analysis of cultural values by Choi et al. (2007). Data was collected regarding frequency of participation in a range of art forms and events using a fivepoint scale (never, once a year or less, every so often, once a month and once a week or more). The survey included a broad range of arts and cultural products which was felt to be broadly reflective of the arts and cultural programs of the three selected regions. Respondents were also asked to answer questions regarding their average monthly expenditure on art products. Again, data were collected on a range of arts and cultural products from magazines and cinema admission to visual arts and musical performances or take home items such as craft products or paintings. Finally, survey participants were asked whether they had attended an arts or cultural festival in the preceding 2 years, and if so were asked to nominate the festival which they attended. The survey was mailed to a total of 2500 households (833 in each target region). A target response

Demand for creative arts in regional Victoria, Australia

Table 1. Summary statistics of target regions City of Greater Sheppartona Population (2004) (#) Pop. Density (people/km2) Distance from capital (km) Remoteness classification Indigenous population (%) Average income (2004) (A$) Unemployment at 30/09/2004 (%) Annual value of agriculture (A$million) Residents with post-school qualification (%) 59 907 24.8 180 Inner Regional 2.8 34 006 5.2 411.9 38.1 Shire of East Gippslandb 40 746 2.0 277 93.5% Outer Regional 6.5% Remote 2.9 32 566 7.5 127.7 41.7 Rural City of Mildurac

621

51 162 2.3 550 98.3% Outer Regional 1.8% Remote 2.4 32 503 8.7 524.9 36.3

Notes: aThe National Regional Profile data presented here refers to the Local Government Area of the City of Greater Shepparton. ABS (2006a) catalogue number 1379.0.55.001. b The National Regional Profile data presented here refers to the Local Government Area of the East Gippsland Shire. ABS (2006b) catalogue number 1379.0.55.001. c The National Regional Profile data presented here refers to the Local Government Area of the Mildura Rural City. ABS (2006c) catalogue number 1379.0.55.001.

rate of 20% was used as a guide for estimating the total number of surveys to be administered.1 A total of 492 completed questionnaires were returned from across the three regional sites. As a total percentage of the 2500 which were mailed, this represents a response rate of 19.7%. This response rate is comparable to the rate obtained by Choi et al. (2007) in their survey of cultural values in Australia.

III. Modelling Approach Our analysis of demand patterns uses the general modelling approach of Levy-Garboua and Montmarquette (1996) as its starting point. LevyGarboua and Montmarquette (1996) analyse the demand for theatre attendance at the individual level. They model the demand for theatre attendance in both static (unconditional) and dynamic (conditional) choice settings. Their model allows the individuals demand for theatre to develop over time based on the increment (either a positive or negative surprise) associated with each new play they attend. This extends their analysis to a conditional choice setting that requires an appropriate selectivity correction to be made prior to estimation. LevyGarboua and Montmarquette (1996) then model the probability of attendance using a probit model, and
1

the frequency of attendance using either an OLS or Tobit specification. Prieto-Rodr guez and Fernandez-Blanco (2000) use the static formulation of the modelling approach in Levy-Garboua and Montmarquette (1996) to explore preferences for classical and popular music in Spain. Prieto-Rodr guez and Fernandez-Blanco (2000) utilize a bivariate probit model in which they simultaneously estimate the preference for popular and classical music in separate equations. Prieto Rodr guez and Fernandez-Blanco (2000) then use the cross-equation correlation to determine if there are common characteristics across classical and popular music listeners. They find a significant correlation thus indicating a taste for music of both styles. Favaro and Frateschi (2007) extend the analysis in Prieto-Rodr guez and Fernandez-Blanco (2000) to study the demand for different styles of music in Italy. Unlike the two equation framework in Prieto Rodr guez and Fernandez-Blanco (2000), the empirical modelling approach adopted by Favaro and Frateschi (2007) is to use an expanded choice set in a multinomial logit model. Favaro and Frateschi (2007) define the alternatives in their choice set to allow choices with a preference for neither of the musical styles, one of the musical styles or both of the musical styles. This allows explicit modelling to distinguish between individuals with a univorous musical preference, as distinct from those individuals

While clearly a mail-out survey creates challenges in terms of both time and financial cost, an online survey may not have reached a representative sample of the target populations, based on the fact that ABS data suggests that only 57% of Victorian households had home Internet access in 20042005, and only 51% in ex-metropolitan areas of Australia (ABS, 2005).

622
with an omnivorous musical preference. They find that age, gender and education are significant predictors of an omnivorous musical taste, and also significantly affect the probability of attending concerts. Borgonovi (2004) analyses the impacts of arts education, prices and standard socioeconomic and socio-demographic characteristics on both the decision to participate in particular artistic events, and the level of attendance at such events. Borgonovi (2004) models the participation decision using a binary logit model, and the level of attendance using an ordered logit model. Unlike Borgonovi (2004) we cannot model the impacts of price effects as we do not have price data in our dataset, although the findings in Borgonovi (2004) suggest that price is not a significant determinant of participation. Borgonovi (2004) finds educational attainment to be positively associated with participation and attendance. Borgonovi (2004) finds only moderate evidence of income effects. We follow the general approach of these papers to explore the demand for creative arts in rural and regional Victoria. The data collected as outlined in Section II is ordered response data on attitudes, frequency of participation and expenditure levels. Thus, we make use of the ordered probit model estimated in Stata (Data analysis and statistical software) to model our data. The use of an ordered response model is consistent with the approach demonstrated in other papers where our broad modelling approach has been adopted. An ordered probit model was used to analyse the effects of demographic characteristics on attitudes, expenditure and the frequency of participation in the arts with the following determinants: gender, income and festival attendance. A number of dummy variables were established to test the effects of age, employment status, highest level of education and place of residence on demand for the arts: age (3544, 4554, 5564, 65 years), work (full time, casual/ part-time); education (partial completion of school, Technical and Further Education (TAFE), university degree, postgraduate degree) and location (Greater Shepparton, East Gippsland). Each of the questions relating to attitude, frequency of participation and expenditure in the arts produced an ordered dependent variable that was analysed using this model, and the parameter estimates, p-values and the associated marginal effects were calculated in each case. The marginal effects can be calculated for each category in the choice set of the dependent variable that is being modelled. In the case of the data on attitudes towards the arts, data was coded into three response categories as follows: (1) Agree; (2) Neutral;

T. Masters et al.
(3) Disagree, thus requiring the calculation of three marginal effects for each explanatory variable. In the case of the data describing how often survey respondents participate in the arts, responses were coded into the following categories: (0) Never; (1) Once a year or less; (2) Every so often; and (3) Once a month or more, thus requiring the calculation of three marginal effects for each explanatory variable. Finally, regarding typical monthly expenditure levels on the arts, responses in each category were coded into the following categories: (0) $0 per month; (1) $1$10 per month; (2) $11$20 per month; (3) $21$30 per month; and (4) $31 or more per month, thus requiring the calculation of four marginal effects for each explanatory variable. Consequently, the results from the ordered probit include parameter estimates and p-values as well as the marginal effects in each case, and as such are vast. Rather than presenting such a large number of tables, the following section presents the analysis of the results for a selection of dependent variables in each case. The aim of this analysis was to identify demographic characteristics that generate significant results in terms of attitude, frequency of participation, or expenditure in the arts. In each case, a sample of the results is presented which demonstrate the significant trends in the data.

IV. Results In the first instance, results from three of the attitudinal questions are analysed. Table 2 presents the results for attitudinal responses to the statement attending arts events is a good way to socialize with people in the community, and reports the parameter estimates and associated p-values in column 2, and the marginal effects and associated p-values in columns 35. Where significant p-values below 0.05 resulted, these are shown in bold. The ordered probit results show that gender and festival attendance are significant, and the variables aged 4554 years; aged 65 years; and partial completion of school are all close to being significant. In the three estimations of marginal effects, female respondents, those aged 65 years and older, and those who attended a festival are significantly more likely to agree with the statement, and less likely to give a neutral response or disagree. Respondents aged 4554 years are significantly more likely to agree, and less likely to disagree. The results in Table 3 relate to the attitudinal statement going to arts events is a waste of money.

Demand for creative arts in regional Victoria, Australia

Table 2. Attitude 1 arts participation is a social connector significant results Marginal effects Variable Gender Aged 4554 Aged 65 Festival attendance (y/n) Probit results 0.577 (0.000) 0.615 (0.000) Agree 0.203 0.136 0.153 0.213 (0.000) (0.048) (0.042) (0.000) Neutral 0.158 (0.000) 0.127 (0.049) 0.168 (0.000) Disagree 0.045 0.024 0.026 0.046 (0.003) (0.047) (0.036) (0.001)

623

Table 3. Attitude 2 cultural expenditure is a waste of money significant results Marginal effects Variable Gender Aged 5564 Festival attendance (y/n) Probit results 0.488 (0.002) 0.579 (0.034) 0.614 (0.000) Agree 0.045 (0.010) 0.038 (0.014) 0.056 (0.001) Neutral 0.102 (0.003) 0.110 (0.017) 0.127 (0.000) Disagree 0.148 (0.003) 0.148 (0.013) 0.182 (0.000)

Table 4. Attitude 3 arts should be more of a priority significant results Marginal effects Variable Gender Aged 4554 Aged 5564 Aged 65 Festival attendance (y/n) Partial school Greater Shepparton East Gippsland Probit results 0.448 (0.001) 0.718 (0.001) 0.470 (0.047) 0.610 (0.000) 0.318 (0.039) 0.345 (0.015) 0.399 (0.008) Agree 0.171 (0.001) 0.280 (0.001) 0.185 (0.046) 0.232 (0.000) 0.121 (0.033) 0.135 (0.015) 0.156 (0.008) Neutral 0.065 (0.001) 0.149 (0.005) 0.090 (0.000) 0.043 (0.017) 0.062 (0.029) 0.073 (0.020) Disagree 0.106 (0.001) 0.080 (0.036) 0.132 (0.000) 0.092 (0.021) 0.142 (0.000) 0.073 (0.011) 0.083 (0.005)

Table 3 shows that the p-values of gender, festival attendance and the variable aged 5564 years are significant in the probit estimation. The marginal effects results show that females, those who had attended a festival, and those aged 5564 years were significantly more likely to disagree with the statement, and significantly less likely to agree or give a neutral response. These are similar findings to those reported in Table 2. The final attitudinal results to be analysed relate to the survey statement: the arts should be more of a priority for local government and the community. Table 4 presents these results, including parameter estimates, marginal effects, and p-values in each case. As was the case in the previous set of results, Table 4 shows significant results from the probit estimation for the variables gender, festival attendance, and aged 5564 years. In addition, those aged 65 years and older, those with partial school completion as their highest educational level, and the two regional

dummies Greater Shepparton and East Gippsland show significant p-values. Females, those who had attended a festival, those aged 5564 years, and respondents from both regions are significantly more likely to agree with the statement, and significantly less likely to give a neutral response or disagree. Similarly, those aged 65 years and older are significantly more likely to agree, and less likely to disagree, although the effects of a neutral response are not significant. Those respondents whose highest qualification is partial school completion are significantly less likely to agree, and more likely to be neutral. The results also show these respondents to be close to being significantly more likely to disagree. Results from the selected sample of attitudinal demand responses lead to the conclusion that age, gender and festival attendance are all variables which lead to significant attitudinal results in the ordered probit model and when the marginal effects in each response category were estimated. The results show

624
Table 5. Frequency of art gallery visitation significant results Marginal effects Variable Gender Aged 4554 Aged 5564 Aged 65 Festival attendance (y/n) Partial school Probit results 0.363 0.522 0.715 0.794 0.826 (0.005) (0.010) (0.001) (0.001) (0.000) Never 0.088 0.107 0.137 0.144 0.198 (0.007) (0.004) (0.000) (0.000) (0.000) 1 year or less 0.048 0.095 0.141 0.163 0.106 (0.006) (0.030) (0.006) (0.005) (0.000) Every so often 0.116 0.164 0.217 0.235 0.256 (0.005) (0.007) (0.000) (0.000) (0.000)

T. Masters et al.

1 month or more 0.019 (0.013) 0.060 (0.026) 0.073 (0.031) 0.048 (0.000) 0.024 (0.003)

0.524 (0.001)

0.137 (0.002)

0.052 (0.000)

0.165 (0.000)

significantly positive attitudes towards the arts by females and festival attendees, while the general pattern appears to be that middle aged and older respondents (4554, 5564 and 65 years) view creative arts more positively. Bihagen and KatzGerro (2000) find differences in cultural consumption between men and women in Sweden with women being more active in highbrow cultural activities, and men being more active in lowbrow cultural activities. Lizardo (2006) notes that this finding of greater participation by women in highbrow cultural activities to be one of the most consistent empirical findings of the literature in this area and then proceeds to explore a number of possible theoretical explanations, including labour force participation, socialization and cultural norms, which are seen to influence engagement with highbrow activities among men and women. We reach a similar finding on gender effects to that of the previous literature. The significance of the festival attendance variable in part suggests the importance of previous consumption behaviour along the lines of the Levy-Garboua and Montmarquette (1996) model. In addition, arts festivals are also found to play an economic development role in the work of Jackson et al. (2005) and Dwyer et al. (2005), while Gapinski (1988) explores the volume of demand for lively arts in London which can be attributed to tourism. Having briefly discussed a selection of attitudinal results from the ordered response model, this article now outlines the results of ordered probit estimation and the corresponding marginal effects relating to frequency of participation in the arts in three areas. Table 5 reports the results of frequency of visitation to an art gallery. The parameter estimates and their associated p-values (in parentheses) are presented in column two, while the marginal effects and their associated p-values are then reported in columns 36 for each of the four ordered response categories. Where the coefficient estimate or marginal effect is significant below the 0.05 level the results are presented in bold. The results in Table 5 show that

gender, the variable measuring festival attendance, those aged 4554, 5564 and 65 years or older, in addition to those who reported partial completion of school as being their highest level of education are all statistically significant in the ordered probit estimation. The marginal effects demonstrate that females, those who had attended a festival in the past two years, those aged 5564 and 65 years or older were all significantly less likely to attend a gallery never or once a year or less, and more likely to attend every so often or once a month or more. The results demonstrate a similar effect among those respondents aged 4554 years, however the results in the category once a month or more (0.058), although close to being significant, were above the 0.05 level. In contrast, the significant results among those with a partial school qualification show that this group is significantly more likely to either never attend an art gallery, or attend once a year or less. The negative coefficients and significant values also show this group to be significantly less likely to attend every so often or once a month or more. Table 6 presents the results for attendance rates at a theatre performance. The ordered probit results for attendance at a theatre performance show gender and festival attendance to be significant with females and festival attendees significantly more likely to attend in the two most frequent categories once a month or more and every so often, while being significantly less likely to never attend, or to attend once a year or less. The variable partial school is significant, and shows that conversely, those who reported their highest qualification to be partial completion of school are more likely to never attend, or attend once a year or less, while being less likely to attend every so often or once a month or more. Aged 5564 and 65 years are significant variables, with respondents in this group shown as being significantly more likely to attend the theatre every so often. These same two groups show negatively significant results in the two least frequent categories, indicating that respondents in these age brackets are

Demand for creative arts in regional Victoria, Australia

Table 6. Frequency of attendance at a theatre performance significant results Marginal effects Variable Gender Aged 4554 Aged 5564 Aged 65 Festival attendance (y/n) Partial school Postgraduate Probit results 0.687 0.433 0.649 0.661 0.797 0.481 0.535 (0.000) (0.033) (0.003) (0.005) (0.000) (0.002) (0.035) Never 0.169 (0.000) 0.089 (0.019) 0.123 (0.000) 0.123 (0.001) 0.188 (0.000) 0.123 (0.004) 1 year or less 0.093 (0.000) 0.132 (0.009) 0.137 (0.016) 0.115 (0.000) 0.060 (0.000) 0.040 (0.001) Every so often 0.241 0.154 0.223 0.225 0.278 0.171 0.185 (0.000) (0.028) (0.001) (0.002) (0.000) (0.001) (0.021)

625

1 month or more 0.020 (0.006) 0.026 (0.003) 0.012 (0.016) 0.010 (0.020)

Table 7. Frequency of attendance at ballet/opera significant results Marginal effects Variable Gender Aged 5564 Aged 65 Festival attendance (y/n) Partial school Probit results 0.622 0.571 0.815 0.614 0.521 (0.000) (0.023) (0.003) (0.000) (0.005) Never 0.207 0.210 0.305 0.208 0.168 (0.000) (0.028) (0.004) (0.000) (0.002) 1 year or less 0.116 0.101 0.130 0.114 0.098 (0.000) (0.013) (0.000) (0.000) (0.005) Every so often 0.082 (0.000) 0.150 (0.016) 0.085 (0.000) 0.064 (0.002) 1 month or more

less likely to never attend the theatre or attend once a year or less. Similar results are observable for those respondents aged 4554 years also demonstrating significant results from the probit estimations, although in this case the marginal effects for the category once a year or less (0.059), although close to being significant, were not below 0.05. Finally, the variable postgraduate was significant, with respondents who reported a postgraduate qualification as their highest level of education significantly more likely to attend once a year or less, and significantly less likely to attend every so often or once a month or more. The final set of results selected to demonstrate trends in the data influencing attendance or participation behaviour in the arts relates to ballet and opera performances. As Table 7 below shows, none of the demographic variables generated significant values in every case. This can be explained by no group being significantly more likely to report attendance at ballet or opera performances once per month or more. The results again demonstrate significant values in the variables festival attendance, aged 65 years and gender, with marginal effects indicating that festival attendees, those aged 65 and older, and females are more likely to attend ballet or opera every so often or once a year or less and are significantly less likely to never attend. The variable partial school is again significant, and respondents who hold this as their highest

qualification appear significantly more likely never to attend, as well as being significantly less likely to attend once a year or less or every so often. The variable aged 5564 years is significant in the probit estimation, with marginal effects results reporting a significant likelihood that respondents in this age bracket will attend the ballet once a year or less, while being significantly less likely to never attend. From the selected results presented in terms of frequency of attendance, a number of demographic variables appear consistently significant. The ordered probit estimations of attendance and participation in a range of arts events and practices shows that gender, age, and highest educational level of respondents, in addition to whether they have attended a festival in the past 2 years as being consistently significant. The most outstanding marginal effects indicate that females and festival attendees are more likely to attend or participate in the arts, while those who completed partial school are consistently likely to never or seldom attend. With the exception of the significant results among respondents with postgraduate qualifications who report infrequent attendance at the theatre, these attendance results are consistent with the findings in the literature regarding the composition of arts audiences, and particularly audiences at theatre, ballet and opera (referred to as high arts) (Baumol and Bowen, 1966; Kurabayashi and Ito, 1992; Towse, 1994; Prieto-Rodr guiez and Fernandez-Blanco, 2000; Arts Victoria, 2002;

626
Table 8. Monthly expenditure levels on books significant results Marginal effects Variable Gender Income Aged 3544 Aged 4554 Aged 5564 Festival attendance (y/n) Uni degree Probit results 0.313 (0.015) 0.075 (0.028) 0.436 (0.026) 0.665 (0.001) 0.295 (0.012) 0.522 (0.002) $0/month 0.099 (0.017) 0.023 (0.028) 0.126 (0.016) 0.180 (0.000) 0.092 (0.013) 0.144 (0.000) $1$10/month 0.018 (0.039) 0.079 (0.024) 0.019 (0.040) 0.059 (0.031) $11$20/month 0.040 0.009 0.041 0.048 0.062 0.037 (0.023) (0.037) (0.029) (0.014) (0.000) (0.018)

T. Masters et al.

$21$30/month 0.035 (0.019) 0.009 (0.038) 0.050 (0.032) 0.075 (0.002) 0.033 (0.016) 0.060 (0.004)

$31/month 0.043 (0.016) 0.011 (0.032) 0.121 (0.011) 0.042 (0.015) 0.091 (0.011)

0.052 (0.000)

Table 9. Monthly expenditure levels on theatre, opera, ballet or dance significant results Marginal effects Variable Gender Aged 5564 Aged 65 Festival attendance (y/n) Probit results 0.540 (0.000) 0.838 (0.002) 0.712 (0.000) $0/month 0.195 (0.000) 0.322 (0.002) 0.258 (0.000) $1$10/month 0.053 0.036 0.051 0.067 (0.002) (0.037) (0.000) (0.000) $11$20/month 0.053 (0.001) 0.078 (0.001) 0.070 (0.000) $21$30/month 0.046 (0.001) 0.085 (0.008) 0.062 (0.000) $31/month 0.042 (0.002) 0.108 (0.038) 0.060 (0.000)

Seaman, 2006). Indeed, as Seaman (2005) notes, the price of leisure is widely accepted by cultural economists as being important to arts demand, the lower levels of attendance at theatre by those with postgraduate qualifications may be linked to a scarcity of leisure time. Interestingly, however, the data appears to demonstrate a slight tendency for older respondents to have higher demand levels for high arts, which is contrary to the finding in Kurabayashi and Ito (1992), where younger audiences were generally seen to be greater consumers of classical music. This could be seen to support the notion that age, as a factor which influences the level of arts consumption, is frequently different across studies, in addition to being an inconsistent determinant of audiences over time (Seaman, 2005). The following set of results show the impact of demographic variables on typical monthly expenditure in the arts. The first table for this set of results, Table 8, shows the results of the ordered probit modelling on book expenditure, including the marginal effects for each of the expenditure groupings. Firstly, the variables gender, aged 5564 years, festival attendance, and university degree were all significant. Marginal effects results demonstrate that females, festival attendees, those aged 5564 years and those who have a university degree as their highest qualification are significantly less

likely to spend either $0 per month or $1$10 per month on books, while being significantly more likely to spend $11$20, $21$30 or $31 or more per month in this category. Income was also significant, and it can be assumed that those with higher income levels are more likely to spend $11$20, $21$30 or $31 or more per month, and less likely to spend $0 per month. Those aged 4554 years were seen to be significantly less likely to report zero expenditure, but significantly more likely to spend $11$20 and $21 $30 per month on books. Although not significant in the probit estimation, those aged 3544 years were more likely to spend $11$20 per month in this category. The next set of results presented in Table 9 show the results ordered probit modelling of reported monthly expenditure on admission to theatre, ballet, opera or dance performances. The results in Table 9 show that in the case of expenditure on theatre, ballet, opera or dance among regional Victorian respondents, the variables gender, 65 years and festival were all significant in the probit, as well as each of the marginal effects. Females, those aged 65 years and older, and those who had attended a festival were significantly less likely to report zero expenditure, and significantly more likely to report spending in each of the other categories. Those aged 5564 years, although the variable was not

Demand for creative arts in regional Victoria, Australia

Table 10. Monthly expenditure on painting, sculpture, or craft (take home) significant results Marginal effects Variable Gender Festival attendance (y/n) East Gippsland Probit results 0.683 (0.000) 0.652 (0.000) 0.326 (0.047) $0/month 0.257 (0.000) 0.248 (0.000) 0.128 (0.047) $1$10/month 0.054 (0.000) 0.049 (0.000) 0.022 (0.034) $11$20/month 0.082 (0.000) 0.079 (0.000) 0.040 (0.049) $21$30/month 0.060 (0.000) 0.059 (0.000)

627

$31/month 0.061 (0.000) 0.061 (0.000)

significant in the probit estimation, were significantly more likely to spend $1$10 per month in this category. Table 10 presents the final results of the ordered probit estimation. This table shows the results of monthly expenditure on painting, sculpture or craft, referred to as the take-home to own arts. In the table above, the variables gender, festival and East Gippsland are all significant in the probit estimation. The marginal effects results show that females and festival attendees are significantly less likely to report zero expenditure in this category, while being significantly more likely to spend $1$10, $11$20, $21$30 and $31 or more per month. East Gippsland survey respondents are likewise shown to be significantly less likely to spend nothing per month in this category, and significantly more likely to spend $1$10 and $11$20 per month. With the exception of the consistently significant gender and festival variables, the expenditure results appear to demonstrate far less consistent results between categories. Book expenditure results show income levels, age, and university degrees to be significant determinants of expenditure, while in addition to gender and festival attendance, age was significant in the case of admission expenditure at theatre, ballet, opera and dance performances. Finally, unlike any of the previous categories, in addition to gender and festival results, inter-regional differences are significant in the final category of expenditure on paintings, sculpture and craft, where East Gippsland respondents showed higher demand levels.

V. Conclusion This article has focused upon three measures of demand for the arts: attitudes, participation rates and expenditure levels, and has used a range of statistical and econometric tests to show demographic trends which affect demand. Overall the results of the ordered probit analysis revealed that in the case of attitudes and participation rates, females, festival

attendees and older respondents are more likely to have the highest demand for the arts, while at the other end of the spectrum those whose highest academic qualification is partial school completion have significantly lower levels of demand. The results also demonstrate that expenditure levels are less consistent across category, with the exception of festival attendees and female respondents, who remain the highest consumers. Moreover results show that while festival attendance is seen as a significant determinant of arts demand, this article has also shown that the lack of a significant annual arts festival does not diminish community demand, but prompts increases in demand for other arts activities in the community. The high level of demand from festival attendees and those with increased expenditure over the past 3 years upholds the learning by consuming model whereby present engagement, enjoyment, and consumption in the arts is contingent on past experience (Levy-Garboua and Montmarquette, 1996; Cameron, 1999; Sisto and Zanola, 2008; Yamamura, 2009). It should be noted, however, that the data and analysis did not determine the causality between festival attendance and higher arts demand. In other words, whether typically high arts consumers are more likely to attend festivals, or whether festival attendance promotes increased demand for other arts products. Similarly this article did not identify potential collinearity between other explanatory variables included in the model, for example the possible effect of the relationship between education and income on the results. This article has presented an economic model of demand for the arts in regional Victorian communities, using a range of statistical and econometric analysis techniques. Focusing on the results of an ordered probit analysis, it has been demonstrated that residents of regional Victorian communities have generally high levels of demand for the arts, and that individual levels of demand are contingent on a range of demographic characteristics. In creating knowledge regarding demand patterns for the arts among regional Victorians, this article has also identified

628
aspects such as festival attendance, increased past creative arts expenditure and demographics such as age and gender to be determinants of demand for the arts. As such this article has also highlighted circumstances, events and characteristics, which cultivate higher levels of demand for the arts in regional Victoria, which could be useful in the context of developing arts policy for regional communities. In addition to presenting empirical evidence of socio-demographic characteristics which affect demand for creative arts specific to the regional Victorian context, the results from this article demonstrate that the regional Victorian arts market exhibits similar as well as contrasting demand patterns to other geographically and culturally divergent international markets.

T. Masters et al.
Beyers, W. B. (2002) Culture, services and regional development, The Service Industries Journal, 22, 434. Bihagen, E. and Katz-Gerro, T. (2000) Culture consumption in Sweden: the stability of gender differences, Poetics, 27, 32749. Borgonovi, F. (2004) Performing arts attendance: an economic approach, Applied Economics, 36, 187185. Cameron, S. (1999) Rational addiction and the demand for cinema, Applied Economics Letters, 6, 61720. Choi, A., Papandrea, F. and Bennett, J. (2007) Assessing cultural values: developing an attitudinal scale, Journal of Cultural Economics, 31, 31135. Collins, A., Fernandez-Blanco, V. and Prieto-Rodr guez, J. (2009) Characteristics of buyers and renters of cultural goods: the case of movies, Applied Economics, 41, 195210. Dwyer, L., Forsyth, P. and Spurr, R. (2005) Estimating the impacts of special events on an economy, Journal of Travel Research, 43, 3519. Favaro, D. and Frateschi, C. (2007) A discrete choice model of consumption of cultural goods: the case of music, Journal of Cultural Economics, 31, 20534. Florida, R. (2002) The Rise of the Creative Class, Basic Books, New York. Gapinski, J. H. (1988) Tourisms contribution to Londons lively arts, Applied Economics, 20, 95768. Gascoigne, J. and Turner, P. (2004) Asymmetries in bank of England monetary policy, Applied Economics Letters, 11, 61518. Jackson, J., Houghton, M., Russell, R. and Triandos, P. (2005) Innovations in measuring economic impacts of regional festivals: a do-it-yourself kit, Journal of Travel Research, 43, 3607. Kurabayashi, Y. and Ito, T. (1992) Socio-economic characteristics of audiences for western classical music in Japan: a statistical analysis, in Cultural Economics (Eds) R. Towse and A. Khakee, Springer Verlag, Berlin, pp. 25787. Landry, C. (2000) The Creative City: A Toolkit for Urban Innovators, Earthscan, London. Landry, C. and Bianchini, F. (1995) The Creative City, Demos, London. Levy-Garboua, L. and Montmarquette, C. (1996) A microeconometric study of theatre demand, Journal of Cultural Economics, 20, 2550. Lizardo, O. (2006) The puzzle of womens highbrow culture consumption: integrating gender and work into Bourdieus class theory of taste, Poetics, 34, 123. Markusen, A. (2006) Urban development and the politics of a creative class: evidence from a study of artists, Environment and Planning A, 38, 192140. Markusen, A. and Schrock, G. (2006) The artistic dividend: urban artistic specialisation and economic development implications, Urban Studies, 43, 166186. McGranahan, D. and Wojan, T. (2007) Recasting the creative class to examine growth processes in rural and urban counties, Regional Studies, 41, 197216. Prieto-Rodr guez, J. and Fernandez-Blanco, V. (2000) Are popular and classical music listeners the same people?, Journal of Cultural Economics, 24, 14764. Scott, A. (1997) The cultural economy of cities, International Journal of Urban and Regional Research, 21, 32339. Seaman, B. (2005) Attendance and public participation in the performing arts: a review of the empirical

Acknowledgements The research in this project was funded by ARC Linkage Grant LP0453477 Demand and Supply of Creative Arts in Rural and Regional Victoria. The project also received financial support from Arts Victoria. We wish to thank Judy Morton for her ongoing support of this research project. We also wish to thank the editor and two anonymous reviewers for their helpful comments on a previous version of this article.

References
Afonso, A., Gomes, P. and Rother, P. (2009) Ordered response models for sovereign debt ratings, Applied Economics Letters, 16, 76973. Arts Victoria (2002) Small to Medium Performing Arts Audiences Fact Sheet, Arts Victoria, Melbourne. Australian Bureau of Statistics (ABS) (1998) The Arts Industry in Victoria: A Statistical Overview, Arts Victoria, Melbourne. Australian Bureau of Statistics (ABS) (2005) Household Use of Information Technology 200405, Australian Bureau of Statistics, Canberra. Australian Bureau of Statistics (ABS) (2006a) National Regional Profile: Greater Shepparton (C) (Local Government Area), Australian Bureau of Statistics, Canberra. Australian Bureau of Statistics (ABS) (2006b) National Regional Profile: East Gippsland (S) (Local Government Area), Australian Bureau of Statistics, Canberra. Australian Bureau of Statistics (ABS) (2006c) National Regional Profile: Mildura (RC) (Local Government Area), Australian Bureau of Statistics, Canberra. Baumol, W. and Bowen, W. (1966) Performing Arts: The Economic Dilemma, Twentieth Century Fund, New York.

Demand for creative arts in regional Victoria, Australia

literature, Nonprofit Studies Program Working Paper No. 05-03, Andrew Young School of Policy Studies, Georgia State University. Seaman, B. (2006) Empirical studies of demand for the performing arts, in Handbook of the Economics of Art and Culture (Eds) V. Ginsburgh and D. Throsby, Elsevier, North Holland, Amsterdam, pp. 41572. Sisto, A. and Zanola, R. (2008) Cinema attendance in Europe, Applied Economics Letters, iFirst, 13. Throsby, D. (2001) Economics and Culture, Cambridge University Press, Cambridge. Throsby, D. and Hollister, V. (2003) Dont Give Up Your Day Job: An Economic Study of Professional Artists in Australia, The Australia Council, Sydney.

629

Towse, R. (1994) Achieving public policy objectives in the arts and heritage, in Cultural Economics and Cultural Policies (Eds) A. Peacock and I. Rizzo, Kluwer Academic Publishers, The Netherlands, pp. 14365. Wood, P. (1999) Think global act local: looking forward to the creative region, in paper presented at The Role of the Creative Industries in Local and Regional Development Conference, Government Office for Yorkshire and the Humber and the Forum on Creative Industries, Manchester. Yamamura, E. (2009) Rethinking rational addictive behaviour and demand for cinema: a study using Japanese panel data, Applied Economics Letters, 16, 6937.

Copyright of Applied Economics is the property of Routledge and its content may not be copied or emailed to multiple sites or posted to a listserv without the copyright holder's express written permission. However, users may print, download, or email articles for individual use.