The economy of cultural tourism and the preservation of the heritage

Assessing the economic role of the heritage

Published on 9 January 2012

Author(s): Valerie Patin/Euromed Heritage News

Type:  Feature N°9 - JAN 2012

Lure of short-term profitability can lead to neglect of the heritage traditional and essential functions

The taking into account of the economic dimension of the heritage, as an issue of development and support for development policies, is relatively recent. This evolution is mainly due to the rapid growth of tourism (almost one billion international tourists worldwide in 2010, including 15% for cultural tourism) that runs through this area very directly (ticket, spending on sites), indirect (expenditure close to the sites, transportation) and induced (spending on equipment and services close to the sites).

But the lure of short-term profitability can lead to neglect of the heritage traditional and essential functions that are the heritage conservation, the scientific research, dissemination of knowledge and strengthening of social ties. To manage this situation in a balanced and shared way, we must first better understand the economic and social problems of the heritage, and precisely understand the issues and processes that facilitate the observation, the types and levels of benefits that its attendance produces, the skills and methods that need to be mobilized. Valéry patin (Université paris 1 panthéonsorbonne, Expert Consultant of the World Bank and UNEsCo) and Hervé passamar (Director of the agency for the development and promotion of the heritage) give us an update on this topic.

What are the elements considered by the economy of the heritage?

The economy of the heritage concerns a set of values associated with the existence, the use and the effects induced by the operation of cultural property. The monetary value of goods in the property market (built and unbuilt) and furniture (movable property) is a first basis for assessment.

In some cases, changing this value may be of a speculative nature (purchase and sales of tourist and non-tourism residences in the historic centres). The values associated with the use of heritage sites are better known: parking fees, ticketing, guided tours or visit support, shopping in the boutiques of sites and collateral activities (restaurants and cafes located on the sites), transport within the sites but also right for picture or speech. other ways of use of the heritage are less well known: management of image rights, location for filming (growing business), rental for special events. all public and private investment, the non-budgetary contributions (sponsorship, donations) and tax benefits associated with the heritage protection are also essential elements of the economy. along with these direct revenues, there are other important aspects such as jobs, trades and skills, financial flows and tax developed on the sites themselves, but also the indirect economic benefits associated with their management. They can be generated, among other things, thanks to the facilities, the equipment, the conservation and restoration work, some management fees, training, printing of documents.

Finally, we consider the effects induced by the attendance of sites, that is to say, the impact in terms of jobs, financial flows and taxation, the amount spent by visitors outside the sites in accommodation, restaurants, shops and services, but also the impact of amount spent by private and public operators to protect and enhance the heritage. This set represents an overall financial volume much higher than the one produced by the direct use and the indirect revenue for the management of sites themselves. For example, a study conducted in 2008/2009 by the agency for the development and promotion of heritage, estimated at 21 billion euros the impact of attendance Heritage protected in France.

What are the methods for assessing the economic role of the heritage?

The more traditional methods include the approaches in terms of land and property value and balance sheet analysis. These approaches are strictly limited to the site itself, which only takes into account its financial dimension. This approach is quite restrictive. It significantly devalues the fragile cultural properties that require heavy investment in conservation.

Methods from economic theory allow the assessment of the cultural goods from a development and investment perspective. These methods are used by international donors. This is particularly the case for the contingent valuation method which allows us to take into account nonmonetary values like the image of the site and consists of measuring the theoretical contribution that people are willing to make to preserve a heritage.

Other methods are sometimes used: travel costs, cost - benefit, hedonic price, multi-criteria. Finally, the assessment of consequences induced by the heritage management is done most frequently by using the so-called method of impacts. This method measures employment, cash flows (wages, tax benefits) and social impact (heritage awareness, public participation in the preservation and enhancement of cultural property, developing a sense of belonging, transmission, citizenship ..) generated by visitor spending and actions in the territories near the site visited but also the expenditure of public and private investors to protect and enhance the heritage.

All these methods value a monetary approach easier to assess objectively and facilitate national and international comparisons. But the benefits of heritage activity are not just monetary. It should also be able to better assess the social, educational and cultural heritage activity. This is an important issue for donors, but still poses real methodological difficulties.

How does an accurate assessment of the economic role of heritage promote the management of cultural property?

The sanctuary and the sustainable preservation of cultural property is now closely linked to the sustainability of economic systems that ensure the management, implementation of dynamic evaluation approaches structurally integrated policies to make heritage promotes the attractiveness and development of territories.

We switch from the concern of «maintaining the allowance» to a demanding measure of production articulating services in cultural, historic, scientific, social and economic dimensions. In addition, the rationalisation and the identification of multiple levels of economic impact allow individual institutions to make policy choices supported by objective data. This is a determinant factor of professionalization, deregulation of practices and partnerships between culture and tourism (co-production data sharing).

Finally, the identification of economic and social issues related to heritage is a factor of acceptability, ownership and strong adherence to local policies for the conservation and recovery. However, it should avoid any slippage, increasing the economic performance due to the optimisation of management methods to first ensure and promote the inalienable cultural heritage. The main challenge of these approaches is therefore in the consideration of the complex link between cultural development and economic promotion.

At the initiative of the Ministry of Culture (Heritage Branch), France has implemented since 2007 a national mechanism responsible for these assessments, a device managed by the agency for the development and enhancement of heritage. The results of this work are available on the site http://www.agence-patrimoine.eu In the framework of the programme for the Union for the Mediterranean, partner countries have registered as a common goal the establishment of national monitoring of the economic benefits of heritage,

Bibliography

  • Agence Regionale du Patrimoine (provence-Côte d’azur), (2009), National study of economic and social heritage
  • Greffe, X. (2003), Economic valuation of the assets, La Documentation Française
  • Patin V., (2005) Tourism and Heritage, paris, La Documentation Française
  • Ost, C. (2009), a guide for heritage economics in historic cities, Indicators, maps and policies, The getty Conservation Institute, Los angeles
  • Throsby, D. (2001), Economics and Culture, Cambridge University press

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