Why Do Nonprofit Performing Arts Organizations Offer Free Public Access?

• Author: Sheela Pandey,Mirae Kim,Sanjay K. Pandey
• Date: 01 January 2018
• Published date: 01 January 2018
• DOI: http://doi.org/10.1111/puar.12769

Why Do Nonprof‌i t Performing Arts Organizations Offer Free Public Access? 139

Public Administration Review,

Vol. 78, Iss. 1, pp. 139–150. © 2017 by

The American Society for Public Administration.

DOI: 10.1111/puar.12769.

Sanjay K. Pandey is the Shapiro

Professor of Public Policy and Public

Administration in the Trachtenberg School,

The George Washington University.

He is a recipient of the NASPAA/ASPA

Distinguished Research Award and an

elected fellow of the National Academy of

Public Administration.

E-mail: skpandey@gwu.edu

Sheela Pandey is assistant professor

of management in the School of Business

Administration, Pennsylvania State

University Harrisburg. Her scholarship

focuses on social entrepreneurship,

leadership, and strategic management

of for-profit, nonprofit, and public

organizations.

E-mail: spandeywrk@gmail.com

Mirae Kim is assistant professor in the

Truman School of Public Affairs, University

of Missouri. Her research focuses on public–

nonprofit partnerships, nonprofit financial

management, and building civil society

through arts and culture. Her previously

published works cover topics such as

charitable giving experiments, the density

of the nonprofit sector, and nonprofit

rainy-day funds.

E-mail: kimmira@missouri.edu

Abstract : A number of studies have shown that arts and cultural programs offer multifarious benefits to individuals

and communities. However, there has been little discussion in the public management literature regarding access to

cultural programs for people with limited disposable income. Although the arts industry is increasingly emphasizing the

importance of expanding cultural access for all, we know little about what drives individual nonprofit organizations’

strategies. This article draws on benefits theory and resource dependence theory to explore the relationships between

different types of revenue and the extent to which performing arts nonprofits offer free access. The authors use a unique

data set compiled by DataArts to test how various types of revenue influence accessibility to the arts and find that

performing arts nonprofits receiving grants from local governments, foundations, and corporations offer more free

access. The article concludes with a discussion of study implications and an application of benefits theory to other types

of nonprofits.

Evidence for Practice

• Key local government officials—such as city managers, mayors, and council members—can influence

nonprofit arts organizations’ orientation to serving individuals and families with little or no disposable

income to spend on arts and culture.

• Nonprofit arts organizations deriving a larger share of revenues from market-based sources are less likely to

invest in increasing public accessibility.

• Nonprofit arts organizations supported by local government and local foundation/corporate donors are more

likely to enhance public accessibility by providing more free admissions.

Mirae Kim

University of Missouri

Sheela Pandey

Pennsylvania State University Harrisburg

Sanjay K. Pandey

The George Washington University

Why Do Nonprofit Performing Arts Organizations

Offer Free Public Access?

T he role of nonprofit organizations in

improving accessibility of public services has

been extensively researched. Employing either

government failure theory or interdependence theory,

scholars have used the “nonprofit density” approach,

which explores the implications of relative proportions

of public organizations and nonprofit organizations

for public accessibility (e.g., Kim 2015 ; Lecy and Van

Slyke 2013; Liu 2016 ). Government failure theory

(Hansmann 1980 ; Weisbrod 1977 ) contends that

the capacity of governments is limited to address a

wide array of demands for public goods and services,

leaving some segments of the population unsatisfied.

In turn, citizens voluntarily supplement public

services by supporting nonprofit services that fulfill

their unmet needs. Interdependence theory (Salamon

1995 ) argues that the nonprofit sector complements

rather than supplements the public sector:

governments finance nonprofit activities in order to

fulfill public demands. The dominance of nonprofit

organizations in some public service domains,

however, requires us to look beyond the “nonprofit

density” approach to advance understanding of public

accessibility. Benefits theory of nonprofit finance,

with its focus on different revenue sources for an

organization and different funder expectations, offers

a promising approach (Young 2007 ). Unraveling

the relationship between the sources of revenues

and nonprofit services can help public officials in

identifying strategies for expanding public service

accessibility.

The nonprofit sector provides services in various areas:

arts and culture, education, health, human services,

and others. This article focuses on the nonprofit

arts and culture sector because of its centrality to

community well-being and social responsibility

(McCarthy et al. 2004 ; Toepler and Wyszomirski

2012 ). Also, the nonprofit arts sector has seen

increasing interest in arts organizations being more

inclusive, and calls stressing the “importance of equal

access of all people to cultural opportunities” have

been growing louder (Markusen and Gadwa 2010 ,

380). This discussion goes beyond simply removing

economic barriers to cultural programming; making a

proactive effort to increase access for diverse groups is