Modeling Engagement, Impacts and Value

This paper is one of a number of working papers produced for the project “Understanding the drivers of, and value and benefits afforded by, engagement in culture and sport”. The objectives of the project are to define and model the following broad relationships: 1. The impact of policy options and other factors on the level of engagement in sport and culture. 2. The outcome of engagement in sport and culture. 3. The value of these outcomes. This paper focuses on the last of these points. Specifically, the objective of this paper is to identify a method for valuing engagement in culture and sport. Engagement in culture and sport and the benefits associated with such engagement are defined based on the outcome of the stakeholder engagement exercise reported in Working Paper 4 (section 3).  A review of the literature on the theory of value identified three types of value associated with engagement in culture and sports (section 4): 1. Economic utility: outcomes whose value can be captured by the amount people are WTP for them. The value of economic utility is measured using market prices or non-market economic valuation techniques 2. Non-economic utility: outcomes whose utility would be undermined if they were bought. The valuation of non-economic utility requires an alternative to WTP estimates. One alternative is the SWB approach. 3. Intrinsic value: outcome that are valuable beyond the utility they produce. Intrinsic value is measured by simply estimating the quantity of the outcome produced, as espoused by the objective list or flourish accounts, and cannot be transformed into any underlying measure of utility. Six methods are proposed to employ existing data to measure the three types of value associated with engagement in culture and sport (section 5). Following a review of the available data, it is proposed that the following methods be employed to value engagement (section 6): 1. Analysis of existing survey data (Taking Part and the BHPS) to estimate the short-term gains in subjective well-being associated with engagement in culture and sport, as well as the well-being gains associated with longer-term outcomes, such as improvements in health. 2. Construction of decision models to estimate the longer-term outcomes associated with engagement in culture and sport. 3. Combining steps 1 and 2 to estimate the overall gain in subjective well-being associated with engagement in culture and sport, and the monetary value associated with these gains. Valuing the impacts of engagement (May-July 2009) The objective is to identify methods for valuing engagement in culture and sport. In order to do so, literature reviews will be undertaken to conceptualise the value associated with engagement and identify existing estimates of these values. Outputs Working paper 5: Initial scoping paper of some definitions and concepts in relation to value, 20 October 2009 This paper summarises different ways of conceptualizing and measuring value in relation to culture and sport. Working paper 8:Understanding and measuring the value of sport and culture, 22 October 2009 This paper builds on working papers 4 and 5 to present a conceptual framework for understanding the value associated with engagement in culture and sport, and identify empirical estimates of this value. The paper concludes by proposing methodological options for valuing engagement.