As part of a three-day GCI meeting on the economics of heritage conservation, held in December 1998 at the Getty Center (see Meeting on the Economics of Cultural Heritage), an open panel discussion was presented. Members of the public and Getty staff joined the meeting's participants to hear presentations by three scholars involved in the meeting.

The panel members included Daniel Bluestone, associate professor of architectural history and director of the Historic Preservation Program at the University of Virginia in Charlottesville; Arjo Klamer, professor of the economics of art and culture at Erasmus University in Rotterdam; and David Throsby, professor of economics at the School of Economic and Financial Studies, Macquarie University in Sydney.

Randall Mason, a senior project specialist at the GCI, moderated the discussion.

Randall Mason: The starting point of this inquiry is that economics can value some aspects of heritage and its conservation very well but does not address other aspects well at all. We've been focusing on the contributions that economic analysis can make to our understanding of conservation decisions. We've also been trying to identify the limits of economic analysis. With that acknowledgment, we've come together to try to build common ground between conservation professionals, scholars of culture, and economists.

Conservation image
 

David Throsby: We sometimes feel, when we speak as economists among people who are interested in art, that we're a bit like the specter at the feast. You can talk about art all you like, but at the end of the day, there's a grim economic reality out there, and we all have to come to terms with it.

In the world at large nowadays, the economic agenda is taking precedence over just about everything else. Much in our daily lives is dictated by an economic agenda over which we feel we don't have a great deal of control and which is asserting a set of values that we don't feel entirely comfortable with.

One thing that has led to the economic agenda's dominant role is the globalization of markets. The marketplace has become the thing that determines how resources are allocated, what gets produced, what gets consumed, and so on. And yet when we think about conservation, we think about things that have nothing to do with the market—historical value, the meaning of objects and sites to people, and even more spiritual things. These can't be captured by processes of monetary exchange. Economists have been trying to come to terms with the fact that a lot of what happens in the arts and cultural heritage exists outside of markets. One thing we've talked about in the last few days is the way we can conceptualize this.

Two things are quite intrinsic to the conceptualization of heritage from an economic point of view. The first is that we can see heritage items as being capital assets, as things we have inherited from the past and are going to transmit to the future. To use a term that is gaining wider acceptance, we can see them as cultural capital—that is, something we may inherit or that we may create by new investment, and that we have to maintain. If we don't maintain it, it decays. If we conceive of heritage as being cultural capital, then we may be able to think in more than just economic terms but in cultural terms as well.

The second thing is the notion, closely linked to cultural capital, of sustainability. We can think of heritage in the same terms that we think of the environment. We've come to understand the relationship between the economy and ecological systems by thinking about sustainable development. We inherit a stock of natural capital—the resources of the world, fresh air and water, and so on—and we pass it on to future generations.

We can think in these terms about cultural heritage. When everybody in this room is long dead, the historic sites, the great artifacts, the great paintings will still exist.

We have the responsibility to think about them in that long term. The notion of sustainability can encapsulate the way in which these things relate to the economy. The sort of development that rips out forests and pollutes the atmosphere is not sustainable in the long term. Behavior that treats cultural heritage in the same sort of exploitative way is also not sustainable in the long term.

Conservation image
 

Arjo Klamer: We economists have good reasons to be very content nowadays. As David has suggested, market ideologies are dominant. On the political left and right, people think in terms of markets to solve most of our problems. I find this happening with the cultural administrators, directors of theaters, of museums—they all go for the market strategy. This might be caused partly by a withdrawal of governments from financing cultural activities. The popular way of thinking is that if the government withdraws, then we have to take recourse to the markets. It's strange, then, to find myself as an economist actually opposing this economization of the world and having to point out its limitations.

Economic science has been affected by what one calls "modernist values." Just like a Mondrian painting, we think in terms of squares -- square thinking, you could call it. We want to be very precise and mechanistic in thinking about the world. This has led to the demoralization of the economic imagination. We have left values and morals out of our discipline. And this becomes a problem, as economic values tend to crowd out the other values we adhere to.

As a society, we don't only work toward increasing our economic capital that generates economic values; we invest a great deal in social capital, which is the ability to associate with others, to form communities. And I would characterize cultural capital as the ability to inspire or to be inspired. It seems to be a critical attribute of the good life and the good society that we're able to do this.

Markets don't do well generating social values. It's an open question whether they can contribute to our cultural capital. Governments, of course, represent a very different sort of mechanism by which values are generated. Governments have proven to be maybe not so good at generating economic value (although a great deal of economic value is generated through governments), but they are better at generating values that are part of the social and cultural capital—values like solidarity and justice. Governments are also effective at generating public goods that in some way are shared, are valued collectively, but cannot be provided by the market. A great deal of the provisioning of the cultural heritage—one kind of public good—is generated within governments.

But there is another sphere of activity that, in generating social values, is far more important than the market and governments combined. I call it the third sphere. Others talk about civil society or the "third sector." It is a sphere of institutions like nonprofit organizations, clubs, and families. In the third sphere, the most important instrument of exchange is the gift—not the market transaction or government action—and gifts rely on the principle of reciprocity: a lot of values are exchanged in some way or another, only it's not set and determined what you get in return. The third sphere is critical in generating social capital, the sense of community and identity.

If you want people to take responsibility for cultural heritage, it may be necessary to seek ways of dealing with cultural heritage in the third sphere. You cannot rely only on governments.

Conservation image
 

Daniel Bluestone: I've been concerned with the way that market ideologies have become dominant in preservation and conservation. Arjo talked about the way in which the economic discourse has crowded out a discussion of cultural values. What has generated this is a rightward drift in our national politics. At the local and national levels, the sense is that the way to justify cultural and social values is to embrace an economic model and to insist that jobs, income, wealth, and taxes are all things that can be generated by historic preservation and conservation activity.

It's well worth having people in conservation be able to marshal economics as part of an argument. But my concern is that the economic arguments are articulated in a way that begins to atrophy the other arguments for conservation. Other arguments—based on social and cultural values—are left imprecise and inarticulate in the rush for precision in calculating the economic impact of preservation or conservation.

It is difficult for the economic models to take hold of the sobering reality that traditionally the market has been a destroyer of value of historic sites more than a savior of them. The language of the market being the savior is actually a radical turn from a much longer discourse that has the market as a destroyer.

The preservation and conservation field tends to be imprecise in its arguments because, for a long time, we assumed that there was total agreement on the values and benefits of our work. We adopted a somewhat high-style, canonical approach to cultural benefits. But this sense of a shared appreciation based on art-historical values has fractured in the last 15 to 20 years. We've broadened the definition of cultural heritage far beyond the standard art-historical understanding of beauty that has been the central paradigm for a very long time. As an alternative, I would propose that the sustainability model is terribly useful because it takes into account the way in which we're stewarding things received from the past.

Historic preservation, community preservation, cultural heritage, and conservation ought to be the keystone of sustainable development. The best thing we can do is figure out how to shepherd the resources in the built landscape that we already have and to figure out strategies for making those useful to ourselves and to future generations. Cultural heritage has the power to render place more meaningful, to forge stronger social connections between people and the places where they live and visit. To the extent that sustainability resists some of the more corrosive and homogenizing effects of economic globalization, preservation and conservation provide a particularly important venue for pursuing sustainable approaches to both the landscape and the economy.

One thing that economics has helped us do through the model of sustainability is to ask not simply the current value but the value over a whole series of generations. So what we're interested in figuring out is how we might model this for heritage conservation, how we might be more articulate about what the values are, and in so doing be challenged (those of us in conservation) to be similarly precise about what it is that we value about heritage.

Audience member: You are interested in conservation and preservation. Seems to me, these are defensive steps. I also hear you talk about paintings, about culture, and this is something that is newly created. Are both of these part of "heritage"?

Bluestone: One of the insights that crystallized in this meeting—and it's been crystallized elsewhere in the literature—is that preservation and conservation are part of a process that doesn't cease with the preservation and conservation of the site. It's just the latest step in caring for our cultural resources. These acts are really as creative and expressive of current cultural values as the work a painter does. I wouldn't want to pass conservation up as simply conservative or defensive. It's an extremely creative and, in some contexts, a provocative act.

Audience member: One consideration I wanted to interject is the function of the works of art that we talk about preserving. For me, the best example is Louis XIV creating Versailles and all else that he created. The creation of art has been about power and prestige. Bearing in mind that these works have always had a political function can inform considerations about how to exploit and preserve them today.

Bluestone: For a long time, conservationists haven't had to confront historical context. If the paint is coming off of the painting, we have strategies for dealing with that. If the mortar joints are deteriorating out of a monument, we can fix it. What you raise is our need as conservationists and preservationists to engage in an act of interpretation that surfaces in the relationship between the material world and art and the people in the society around it. The reason to do that is not only to better understand the cultural heritage but to more fully understand our own participation in the world in which we live, and to empower our citizenship in relationship to the very same sets of relations.

Audience member: It seems to me that you're talking about two distinct issues. One of them is the economic; then you insert social or cultural capital. And you talk about sustainability. But these are black boxes, as far as I've heard so far.

Klamer: We are trying to expand the field of inquiry so that economists can participate with others from different fields to illuminate these black boxes. We economists are not equipped to figure out how cultural capital is generated or how social capital is generated. Anthropologists, art historians, historians, and sociologists have done a great deal more. We have to explore those dark boxes in order to come to a comprehensive picture that allows us to figure out how people decide what to add to the good life through conservation. Decisions about cultural heritage are part of that. But if you only focus on what we can already enlighten with economic analysis, then you fall short. So agreed: black boxes—that is good for us. Because that means that there's a lot of work to do.

Audience member: What are the ways to bring conservation back to the grass roots and to account for more than market values?

Throsby: One way is to involve the grass roots more in decision-making structures—having people who are genuine stakeholders in decision-making structures participate, rather than have some sort of external economic or investment agenda foisted upon them.

Klamer: Sometimes the best design has local citizens taking charge, and the best strategy might be for the government to withdraw and give way to local initiative. At least, that's what we observe to be how it usually works. But of course, as a policy maker, I imagine that's a hard strategy to follow.

Mason: I think we've performed a remarkable act by even having this meeting, where economists and anthropologists and people in conservation are sitting down and opening their minds to very different approaches to conservation. This interdisciplinary dialogue is essential to understanding the role of conservation in society generally and, as we've seen, to understanding how economics can shape conservation and the arts.