Factors that Influence Willingness to Pay for Theatre Performances: The Case of Lithuanian National Drama Theatre

Abstract

Cultural sector has a dual impact on the socio-economic system: the economic value (expressed in terms of market relations) and the cultural (non-market) value indirectly contributes to the welfare of the state through changes in societal values, creativity transformations and cultural needs of the country. Measurement of indirect (cultural value) impacts is difficult, but in the case of the cultural sector (especially when it comes to economically inefficient state-funded culture), it helps to reveal the essential characteristics. The study aims to analyse the value of cultural organisations that are invisible in market processes. This was done by analysing the usefulness of the consumer, incorporating not only the price paid but also the social and cultural decision-making factors that determine the spectator's choice (time dedicated for a visit, additional costs, content, previous experiences, and corporate image). This may reflect the consumer's real choice to consume (all the costs he incurs may be considered the financial equivalent of his experience with the cultural establishment). Methodology was tested by applying methods to Lithuanian national drama theatre (LNDT) case. The empirical research consisted of a survey (more than 800 participants) of LNDT visitors. The willingness to pay and travel costs methods were used. Analysis of different performances lets identify the factor that increases willingness to pay for the performance and affects theatre attendance. The research stresses the importance of cultural value and social perspective of the cultural sector and relates it to the discussions of public funding of culture.