Abstract

Italian theatres receive a large amount of public subsidies as part of a long-lasting policy in support of Performing Arts. Quality enhancing performances receive a dedicated share of subsidies. In the process of a general review on public expenditure the need grows for reliable assessments of its effectiveness. Economic-managerial type of efficiency is one important aspect in assessing any public policy. By means of models based on Data Envelopment Analysis coupled with Principal Component Analysis we provide at once an estimate of economic efficiency for Italian theatres, in the 2008-2018 period, and a measure of the incentive effects of quality dedicated subsidies. Results show that efficiency is relatively low and subject to large variability by time and theatres. Thus posing a question as to what extent public expenditure decision making does take efficiency into consideration. The effectiveness of quality driven subsidies is severely hampered by the actual procedure used in allocating public resources to theatres.