Audience success or art for art's sake? Efficiency evaluation of dance companies in the United States

Abstract

Our aim is to evaluate the performance of American dance companies, considering that the production process may be subdivided into consecutive stages consisting of fundraising, artistic production, and social impact. A three‐stage network‐Data Envelopment Analysis model is applied which takes account of the links between stages in the form of intermediate inputs/outputs and provides an overall indicator of efficiency together with partial performance indicators in the stages. Given the lack of information for some variables, we previously undertook a process to impute missing values following MICE (multiple imputation by chained equations) procedures. Results show that the highest levels of efficiency are achieved during the cultural creation stage, whereas the lowest correspond to social impact, indicating that dance companies pursue artistic excellence in their cultural programming, irrespective of their activity's commercial outcomes. Moreover, public and private funds are seen to be channeled following this guideline, thereby justifying the non‐profit status of these entities.

Capital structure determinants for arts nonprofits

“…Related to these issues, Grizzle (2015) finds that the financial performance of arts organizations can influence fundraising efficiency, so arts organizations that do well on the financial stage are poised to garner more significant private resources in a continuing cycle. Other arts-focused studies examine the relationship of financial efficiencies related to fundraising (Hughes, Luksetich, & Rooney, 2014;Kim & VanRyzin, 2014;Smith, 2007;Song & Yi, 2011) or even a broader social impact (del Barrio-Tellado, Herrero-Prieto, & Murray, 2020).…”

Urban public libraries: Performance analysis using dynamic-network-DEA

“…Network-DEA evaluation models thus emerged where the production process is divided into various stages, the first few of which are under the manager's control and the outcomes of which become the intermediate input for the subsequent stages that are geared towards providing the final service. Under these premises, evaluations have also been carried out of the performance of museums [23], archives [24], and dance companies in the area of performing arts [25]. Likewise, numerous studies have emerged aimed at gauging what effect variables outside the production function have on cultural institutions' level of efficiency, applied to museums [23], archives [26], and cultural heritage agencies [27].…”

Evaluating a Cultural Policy in the Dance Sector. Does Efficiency Always Mean Achieving Goals?

“…In the area of symphony orchestras, Hong (2014) posits a two-stage DEA model that evaluates the efficiency of fundraising activities for a set of 48 young orchestras in the United States. Finally, in the specific case of the dance market, Del Barrio-Tellado et al (2020) evaluate the performance of American dance companies using Network-DEA and then dividing the production process into three stages, fundraising, artistic production, and social impact. Their results show how dance companies focus their efforts mainly on artistic and creative purposes, regardless of what effects these criteria might have on audience success.…”

“…v We do not use more sophisticated models such as Network-DEA as in Del Barrio-Tellado et al (2020) in which the production process is divided into different stages that are more or less controlled by the manager. This is because our purpose is not to measure the efficiency of these agents in the market, but rather to analyse how they optimize their behaviour when fulfilling the goals established in the cultural policy.…”

“…Finally, Labaronne (2019) explores the organizational practices of large European dance companies and Smith (2003) shows how public grants attract private fundraising in non-profit dance companies in the USA. Studies evaluating efficiency in the dance sector are relatively scarce (Del Barrio-Tellado et al 2020) although there are several works aimed at evaluating theatres, as the main venues where performing arts are carried out.…”