Cuts are unproductive

2012-01-20 L’Osservatore Romano

Many opera companies are going through a difficult financial crisis; especially in Italy and particularly the most important ones. In 2010, the most recent year for which data are available, only three of the thirteen opera foundations (which manage theatres such as La Scala, San Carlo, the Rome Opera, the Massimo in Palermo) closed their accounts in the black.

In the United States, the picture is markedly different. In New York, on the one hand the Metropolitan Opera is obtaining a new public as well as new (private) support, thanks to the use of advanced technologies; on the other, the New York The Shanghai Grand TheatreCity Opera, riddled with debt, has a season with few productions and in secondary halls. In Asia, on the contrary, the market is in full expansion: new theatres have been built in Beijing, Shanghai, Hong Kong and Singapore.

The history of economics acknowledges that there have been periods and countries in which opera has not been a burden on the coffers of the State but rather a  remunerative sector for those who invested in it, and, through the imposition of taxes, contributed to public finances. However the general impression that the contrary is true is widely held.

This belief is demolished by an interesting study by Olivier Falck (of the IFO, the most important centre for economic research in the Federal Republic), Michael Fritsch (of the University of Jena) and Stephan Heblich (of the Max-Planck Institute). It was published by IZA, the German Institute for studies on human capital) as Discussion Paper No. 5065.  The research makes use of a vast range of indicators in order to understand whether the opera houses are located in areas that were already in a phase of development prior to the decision to build them (the dominant hypothesis) or whether, instead, it is they that have triggered a process of economic expansion. The available data permit one to say that Trier,  Bautzen, Stralsund, Rostock, Dessau, Passau and Regensburg –  to mention but a few of  the places where the sample opera houses are located – have no indicators of a better economic and social development, moreover, than  the territories of what was to become the German Empire in 1870. In many cases, in the period prior to the theatre's construction and inauguration, they revealed below average indicators.

This explains that the decision of emerging Asia to invest in opera houses is also rational from the strictly economic and not only cultural viewpoint. The policies of reduction in the public support of opera houses should perhaps be reconsidered in the light of the conclusions of the study. Especially with regard to efficient realities in terms of cost and production.

Giuseppe Pennisi, President of the Technical-Scientific Committee for the economy of culture at the Ministry for Cultural Assets and Activities