This document proposes a preliminary framework for analyzing the "cultural return" of cultural organizations, or the net benefits they provide beyond financial measures. It identifies several types of cultural returns, including entrepreneurial, policy, diversity, cultural clustering, participation, and educational effects. The framework is applied through surveys and interviews to three cultural organizations in Puerto Rico. Summary tables and graphs are used to analyze the cultural returns provided by each organization to both supply and demand sides of the cultural sector. The document concludes that models accounting for both economic and cultural value are needed to better understand the full impact of cultural activity.

1. CULTURAL RETURN:
TOWARD A PRELIMINARY
FRAMEWORK
Javier J. Hernández Acosta, MBA
International Conference on Cultural Economics
Kyoto, Japan June 21-24, 2012

2. INTRODUCTION
 There is a need to understand the impact of arts and
culture at the micro level.
 There is a need of a better balance between economic
and cultural indicators.
 It is important to “describe, understand and establish”, not
only to measure.
 “Cultural return” could be a parallel analysis to “financial
return”.

3. RESEARCH OBJECTIVES
To develop a preliminary framework for the concept
of “cultural return” as an analysis that describes the
effects of cultural organizations into the cultural
sector. The concept is expressed as the net
benefits of cultural organizations that are not
included in the financial statements.

4. METHODOLOGY
 Literature review on social analysis for
businesses, performance of cultural
organizations and spillovers in the cultural and
creative industries.
 Development of an analysis model based on
the experiences of three cultural organizations in
Puerto Rico.
 Surveys and interviews with employees,
collaborators and customers of these three
organizations regarding the positive effects of
the organizations (47 questionnaires).

5. LITERATURE REVIEW
 Cultural Value – (Throsby, 2001, Holden, 2004, King,
2003, Klamer, 2002)
 Accountability and Social Analysis – (May, 2011, Shedler,
1999, Gallego, 1999)
 Performance evaluation in cultural organizations –
(Peacock, 2003, FEMP, 2009, AECD, 2009, López, 2002,
Porter, 1990, Chiaravalloti &Piber, 2011, Sawhill &
Williamson, 2001)
 Externalities (spillovers) – (DCMS, 2007, Benegas, 1998,
Throsby, 2001, Hagoort, 2003)

6. Effect Impact Description
Entrepreneurial
Effect
Supply
Effects of cultural organizations on the development of other cultural projects. The effect is
expressed in terms of projects developed by members, collaborators, sponsors or competitors.
This includes developing job skills and experience, and interaction with other industries.
Policy Effect Supply
Effect of a cultural organization on issues traditionally associated with cultural policy, such
as subsidies and access to the arts. This net benefit does not result from the main cultural
activity but from management practices that allows an efficient allocation of resources.
Diversity Effect
Supply,
Demand
Effect of cultural organizations on the content and context of artistic activity. It can be
expressed in terms of aesthetical, historical and artistic terms, and as cross-generational,
folkloric and traditional expressions and openness to innovation. Similarly, diversity arises as
a demand effect when audiences have access to a diverse offer or through a diverse audience
composition.
Cultural Clustering
and Cultural Life
Supply,
Demand
Phenomenon by which a project influences the development of cultural spaces and a climate
of “cultural life”. It describes the agglomeration of cultural activity and its relation to the
participation of citizens.
Participation Effect Demand
This effect describes the impact of cultural organizations in promoting citizens’ participation
in the arts. It refers mainly to the extent that promotes access for segments of the population
that traditionally do not attend for different reasons. Overall, it describes the scope and
diversity in the audience’s composition.
Educational Effect Demand
Direct impact of the project in terms of educational activities related to the arts. This type of
events, despite not being the main activity of the company, has direct effects on participation
and enjoyment of the arts.
CULTURAL RETURN ANALYSIS MODEL (SUMMARY
TABLE)

8. Effect
Policy approach
(FEMP, 2009)
Competitiveness
(Porter, 1990)
Value Chain
(López, 2003)
Cultural Track
(Hagoort, 2003)
Entrepreneurial
Effect
Social, economic and
territorial development
Innovation and Memoir
Firm Strategy, Structure
and “Cooperation”
Related and Supporting
Industries
Creation
Production
Distribution
Cultural innovation,
Artistic Leadership,
Artistic and creative
processes
Policy Effect
Access,
Participation
Local Culture
Factor conditions
Creation
Production
Conservation
Historic analysis,
Cultural credit,
Diversity Effect
Innovation and Memoir
Access
Participation
Local Culture
Firm Strategy, Structure
and “Cooperation”
Demand conditions
Creation
Production
Consumption
Multicultural context
Cultural innovation,
Artistic and creative
processes
Cultural Clustering /
Cultural Life
Social, economic and
territorial development
Innovation and Memoir Local
Culture
Related and Supporting
Industries
Factor conditions
Creation
Production
Distribution
Consumption
Cultural Innovation,
Common Interest, Artistic
and creative process
Participation Effect Participation Demand conditions Consumption Common Interest
Educational Effect
Access
Participation
Factor conditions
Demand conditions
Training
Consumption
Common Interest
CULTURAL RETURN – LINKS WITH THEORETICAL
APPROACHES

9. CULTURAL ORGANIZATIONS – CASE STUDY
 Taller Cé – Cultural cooperative that operate from 2001
to 20010. Members were singer-songwriters who invest
and receive dividends according to their work. Operated
a Theater that produced over 1,000 events from
independent artists. The Cooperative produced seven
compilations.
 Teatro Breve – A theater company that produces a new
comedy event two times a week. The company employs
aprox. 8 actors and a production crew of 10 people.
 Cambio en Clave – A project that offer Salsa dance
lessons to general population. It has impact over 10,000
people, coordinate Salsa events, a promote
performances with local artists.

10. ANALYSIS – TALLER CÉ (SUPPLY)
Summary Table 3. Taller Cé “Cultural Return” Analysis – Supply Side
Supply Effect Impact Indicators
Policy Effect
Transferring of labor subsidies to
artists through the reduction of
production costs.
1. Analysis of production costs for artists
and theater policies.
2. Admission rights income generated by
artists.
Entrepreneurial Effect
Facilitating the creation of cultural
projects through their services.
1. Musical recordings and performances.
2. Arts projects developed during the
period.
3. Other venues opened during the period.
Cultural Clustering /
Cultural Life
Contribution in the revitalization of
Río Piedras and its “cultural life”.
1. Business developed in the area after the
Cooperative.
2. Collaborative events produced.
3. Interdisciplinary cultural events
produced.
Diversity Effect (Supply)
Openness to diversity in the cultural
offering through exhibition and
performance policies.
1. Qualitative events analysis by genre,
sector, etc.
2. Qualitative analysis of special events.
3. Analysis of events with international
artists.

11. ANALYSIS – TALLER CÉ (DEMAND)
Summary Table 4. Taller Cé “Cultural Return” Analysis – Demand Side
Demand Effect Impact Indicators
Diversity Effect
(Demand)
Audience segmentation,
strengthen niche markets and
developing new segments.
1. Analysis of the cultural offering.
2. Artists and producers opinion on
events and audiences.
3. Demographic profile of the
audience.
Educational
Effect
Impact on youth segments
through music lessons.
Professional education to
artists through workshops on
management and
performance.
1. Attendance data of students and
workshops
2. Analysis of educational events
produced by other entities.
Participation
Effect
Access and active
participation for different
audience segments in the
cultural activity.
1. Analysis of audiences’ opinion
2. Analysis of the artistic offer.

12. TALLER CÉ – SUMMARY GRAPH

13. TEATRO BREVE– SUMMARY GRAPH

14. CAMBIO EN CLAVE – SUMMARY GRAPH

15. CONCLUSIONS
 Performance analysis model should be able to adapt to the
realities and differences between sectors and activities.
 Governments should develop models to balance the analysis
between economic and cultural value.
 Artists-entrepreneurs and cultural organizations should use
models to understand the net benefits of their cultural
activity.
 It is easier for organizations to understand their impact on
the cultural sector with cultural indicators.
 “Cultural Return” should be an integral part of strategic
planning in cultural organizations.