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Ownership, organization structure and public service provision: the case of museums

Abstract

This article provides an empirical investigation of the effects of the ownership and organizational structure on the performance of cultural institutions. More specifically, we consider how museums are effective in their function of disseminating culture to audiences and contributing to the local development. By exploiting a unique data set based on the 2011 census of Italian museums, we develop performance indices of accessibility, visitors’ experience, web visibility and promotion of the local cultural context. Using count data models, we regress such measures on the type of organization. We distinguish between governmental museums, public museums whose administration is either outsourced or has financial autonomy and private museums. We control for the most salient characteristics of a museum, competition pressure and some proxies of potential audience. Our evidence shows that private museums, public museums with financial autonomy and outsourced museums outperform public museums run as sub-units of culture departments. This paper contributes to the cultural economics and public policy and administration literature by adding insights into the effect of outsourcing and administrative decentralization in the public cultural sector.

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Notes

  1. 1.

    The levels of government most involved in delivering cultural services are central government and municipalities, the former with a Ministry of Culture, the latter with their own culture departments.

  2. 2.

    The new European law fostering the outsourcing of public economic services of general interest also had an impact, as it triggered a general trend towards outsourcing in Italy.

  3. 3.

    Outsourced museums also have the advantage conferred by the fact that new employees may be hired using private market employment contracts, which are characterized by greater flexibility. However, unless it is the case of a newly opened museum, the service provider is usually asked to employ the current staff at the same conditions as before. This implies that a reduction in the cost of staff is not to be expected, on average, in the short run.

  4. 4.

    The activities we consider in measuring museums’ connectivity with the local context cannot be strictly defined as products or services. Still, borrowing from the literature on performance indicators and measurement (Pignataro 2003) we broadly define them as outputs because they are the result of a museum’s effort, which requires organizational capacity and some deliberate choice on the allocation of inputs.

  5. 5.

    All museums in the same municipality have been considered, also those not included in the sample.

  6. 6.

    These tests are available upon request.

  7. 7.

    The exp of each coefficient gives the incidence risk ratios (IRR), which is 1.3391 for AUTO and 1.1491 for OUTS.

  8. 8.

    There is evidence that in Italy art exhibitions affect tourist flows in a negligible way (Di Lascio et al. 2011).

  9. 9.

    We construct this variable using the answers to two questions on audience in the census survey. These values are therefore self-reported by each museum.

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Correspondence to Chiara Dalle Nogare.

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Bertacchini, E.E., Dalle Nogare, C. & Scuderi, R. Ownership, organization structure and public service provision: the case of museums. J Cult Econ 42, 619–643 (2018). https://doi.org/10.1007/s10824-018-9321-9

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Keywords

  • Public sector performance
  • Outsourcing
  • Decentralization
  • Museums

JEL Classification

  • L33
  • Z18
  • H42