Researching Economy, Nonprofit Arts and Culture in Philadelphia

The city of Philadelphia has been known for several years as the “Athens of America”. The city comprises a rich tapestry of cultural ground – art, music, theater, dance etc. Today Philadelphia has stretched its wings and with the expansion of Broad Street’s Avenue of the Arts, one can see that the artistic aspects of the city are continuing to flourish. However, artistic organizations and non-profit societies struggle with the challenge of capitalizing on these prospects, remain competitive and maintain a close relationship with the city as a whole. The following essay details research conducted by the Regional Arts and the Cultural Economy. The author will first define the business research and the purpose, she will then explain the business problem under investigation, identify all parties involved in conducting this research and describe the methods used to conduct this project.

The Arts bring wonders to the community and the city of Philadelphia. Firstly it provides a tourist attraction which gives the city impressive revenue. For example, “The Salvador Dali exhibit generated a total economic impact of $54.9 million within the Philadelphia region, with a total direct economic impact of $30.7 million and a total indirect economic impact of $24.2 million” (GPTMC, pg 5, 2005). The Arts provide a service to those who reside in the region, with education and multi-cultural organizations that topic all interests and branch out to all demographics from the Asian- American Alliance to the India Music and Dance Society. The city is still growing but the fact remains that though the Arts are such a large part of Philadelphia society, it is still fragile and could be eliminated at any given time if organizations do not remain competitive, active in the community, and contributive to the city’s revenue. The purpose of researching this topic is to define and assess cultural organizations’ contributions to the city’s economy, example; jobs, spending and tax revenues. For Non-profit arts to remain competitive, researchers must look beyond obvious inputting and outputting costs. “Understanding how this region’s nonprofit cultural community contributes to our economy and its economic is a vital tool in building our economic future.” (PEL, pg. 3, 1998). In order to understand the purpose of this research, one must recognize the challenge.

The challenge is to capitalize on emerging opportunity, remaining competitive and increase revenue base. Nonprofit arts societies have a disadvantage of fragility as was mentioned earlier, in comparison to say, a local brewery or a bookstore that works independently, generating revenue for their own use. Nonprofit arts must focus on, tourism, restaurant sales, economic spending, jobs, creativity, political leanings, attracting talented people, to name just a few bullets on the agenda. All of those factors make it difficult for a mere handful of people to coordinate and facilitate these efforts. Many local nonprofit organizations must be involved.

Several organizations are involved to conduct research on economy – nonprofit arts and culture in Philadelphia. Three prominent organizations that stand out in this research are Pennsylvania council on the arts (PCA), Pennsylvania Economy League (PEL) and the National Endowment for the Arts. Pennsylvania Council on the arts or the PCA is “governed by a Council of 19 members – 15 private citizens and four members of the General Assembly. Citizen members are appointed by the Governor and confirmed by the Senate. The Council sets the mission and goals for the agency, evaluates the PCA’s progress toward these goals, formulates policy, and makes final decisions on the use of funds” ( The PCA has funded hundreds of art and community projects which makes them a key role in this research project and their role in this project is to provide data that includes – income trends, spending comparisons and non-profit cultural revenues. The Pennsylvania Economy League’s role in this research project is similar to that of the PCA in that their research reflects financial aspects of nonprofit arts. PEL is a research organization who’s mission is to provide information for all nonprofits in Southeastern Pennsylvania. PEL works directly with government officials to execute programs. PEL’s role in this research project is generally to collect massive amounts of information, conduct surveys to inevitably find solutions. In order to expand research to areas throughout the country, the National Endowment for the Arts or the NEA is crucial to this project in relationship to national art and culture. The NEA, based in Washington DC is by far the most important contribution to this research. Two advantages, being a national organization and sharing close ties with the US government and also has accessibility to global artistic relations. With these prominent organizations backing research on Philadelphia non-profit arts and the economy, several methods were used to calculate economic impact.

Three methods that stand out are: the IMPLAN model, surveying, and data mining. Pennsylvania Economic League chose to use IMPLAN to conduct research. IMPLAN stands for Impact analysis for Planning. With the use of this model, PEL was able to “build a customized model of the arts and culture sector within the Philadelphia region”. (PEL, pg 49, 1998) Using results from surveys conducted, the IMPLAN team collaborates to create charts and bar graphs that indicate everything from – Sources of contributed nonprofit cultural income to total spending impact, which includes tourist spending, audience spending and organization spending. PEL mails out detailed surveys to cultural centers, museums, galleries and theaters that ask questions relating to facilities, souvenir sales, and money spent on marketing and promotion, maintenance etc. PEL’s surveys ask about number of attendees for performances, lectures, and workshops. Once this information is sent back PEL, PCA collaborates to come up with defined theories. Pennsylvania Council on the Arts collects the data – figures, expense reports, government documents and works with PEL for the IMPLAN model to go into effect.

In summary these methods produced powerful results. It has shown that, “Greater Philadelphia’s nonprofit cultural industry is a $300 million industry with more than 5,500 direct full and part time employees” (PEL, pg 39, 1998) This study has also proven that the so called “new- dollars” or external funds are continuing to increase the city’s revenue. Tourism is definitely at large today, and will continue to thrive as well as branch off into different dimensions. This research was conducted by the Regional Arts and the Cultural Economy task force. The author defined the business research and the purpose, she then explained the business problem under investigation, identified all parties involved in conducting this research and described the methods used to conduct this project.


GPTMC Dali Hotel Package – Report on Survey Findings pg 5

Pennsylvania Economy League – Regional Arts and Culture Economic Initiative Greater Philadelphia’s Competitive Edge pg 3, 39, 49

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