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Study context and motivations

The Department for Culture, Media and Sport (DCMS), commissioned Alma Economics to conduct exploratory research into the application of non-use value in the context of UK culture and heritage. This research is part of a wider programme of work called Culture and Heritage Capital (CHC), which DCMS is leading in partnership with its Arm鈥檚 Length Bodies and the Arts and Humanities Research Council.

The aim of the CHC programme is to ensure that economic, social and cultural value is included in appraisals and evaluation, following best practice guidance set out by HM Treasury鈥檚 Green Book. Without an agreed method for valuing the flow of services that CHC assets provide, the impact of proposals on specific groups, households, communities and businesses is underestimated, particularly during social cost benefit analysis (SCBA). For further background on the CHC programme, please see the CHC portal and Embedding a Culture and Heritage Capital Approach.^{[footnote 1]}

Individuals attribute value to culture and heritage even if they do not directly consume it themselves, known as 鈥渘on-use value鈥�. This typically includes the value people get from the existence of a cultural good (existence value) and from others being able to benefit from a good or service, in the present (altruistic value) or for future generations (bequest value). These types of value are particularly important for culture and heritage assets and can make up a substantial part of their value but are often overlooked in decision making.

Understanding why individuals hold non-use value is therefore important, as well as determining whether non-use values in the context of culture and heritage should be considered differently to non-use values in other contexts (e.g., the environmental and transport domains).

In our experiments, we found that individuals who had not visited the Natural History Museum in the past three years were willing to pay an average of 拢11.95 as an (indefinite) annual donation to preserve the museum. This provides a clear illustration that non-use value is not only conceptually important, but also economically significant, with meaningful implications for public policy and investment decisions.

This research provides new insights into the theoretical underpinnings and drivers of non-use value for UK culture, creative and heritage sectors, as well as providing practical guidance on how best to quantify and monetise it for social cost-benefit analysis (SCBA). The study explores how non-use value varies across the population, motivations and drivers of value, appropriate catchment areas, bias mitigating strategies, and marginal non-use values.

HM Treasury鈥檚 Green Book explicitly allows for non-use benefits to be included in SCBA, yet, to date, practitioners have lacked clear evidence on how to do so for culture and heritage. The findings in this report therefore provide a first step towards consistent, Green-Book-compliant appraisal of cultural non-use values for cultural, creative and heritage sectors. In the future, DCMS intends to issue more formal guidance on applying both use and non-use values in SCBA.

Approach

The figure below summarises the main stages involved in the delivery of this research into non-use value in the context of UK culture and heritage. The research commenced with a Rapid Evidence Assessment (REA) where we reviewed the current evidence base to ensure our study built on existing evidence and was targeted toward addressing evidence gaps. We then developed and deployed four survey-based experiments which were focussed on three UK-based museums 鈥� the Natural History Museum (NHM), the World Museum (Liverpool), and the Museum of Liverpool 鈥� and tested with a large sample of the UK general public (capturing responses from over 13,000 UK adults). Statistical analysis was conducted to ensure robust conclusions were drawn from the survey data. The experiments were followed by two focus groups, used to understand the motivations and drivers of non-use value. As an extension to the four experiments, we also applied wellbeing valuation to non-use value, using the data collected through the four survey-based experiments.

Key findings and takeaways

All four of the experiments elicited substantial positive non-use value (as measured by average respondent WTP), indicating that large amounts of economic welfare would be omitted from SCBA of museums if non-use value is not captured.

Drivers of non-use value

The literature reviewed as part of this study indicated that culture and heritage assets generate all of the three commonly cited forms of non-use value: existence, bequest, and altruism. Our experiment exploring the non-use value associated with marginal changes to the Natural History Museum elicited positive estimates of non-use value for changes focussed on each of the three forms of non-use value. When exploring drivers of non-use value qualitatively with individuals through the surveys and focus groups, motivations for holding non-use value were found to include the role of museums in preserving and facilitating access to heritage for current and future generations, their educational value, their contributions to research, and their value as heritage sites in and of themselves (including buildings and exhibits). Whilst the drivers cited in the qualitative research did not always cleanly align with the established definitions, arguably they are all captured within the three forms of non-use value.

Experiment 1: exploring the impact of bias mitigation strategies

A range of biases may arise within willingness-to-pay (WTP) calculations for non-use value, including hypothetical bias, anchoring biases, payment vehicle biases, and income effects. This experiment, with a focus on the Natural History Museum, explored the impact of entreaty scripts (namely, cheap talk and oath scripts), levels of information, and payment cards on the elicitation of non-use value for non-visitors and associated biases.^{[footnote 2]} Our research provides new insights into the impact of contingent valuation questionnaire design on the magnitude, certainty, and perceived consequentiality of non-user WTP. These results can be factored into practical guidance around the measurement of non-use value for policy appraisal. The findings from this experiment suggest the following recommendations.

The absence of a cheap talk script was found to increase non-visitor WTP by 30% whilst decreasing respondent certainty by around 9%. The absence of an oath script was not found to have a statistically significant impact on elicited WTP but did decrease respondent certainty also by around 9%. These results suggest that the acts of priming individuals about the existence of biases and committing to an oath can encourage non-visitors to more carefully consider their WTP.

Our study found that non-visitor WTP was highly sensitive to the ordering of the payment card, with a descending order payment card found to increase WTP by 36% compared with an ascending order payment card. Respondents were also around 4% less certain about their WTP responses with a descending payment card, possibly reflecting the fact that the WTP amounts they were selecting were significantly higher. We hypothesise this may be evidence of starting point bias, with respondents anchoring their WTP response to earlier options on the payment card. We did not find any evidence of range effects with respect to the payment card WTP amounts.

Whilst the inclusion of policy news was not found to have an impact on the level of non-user WTP, it was found to increase respondent certainty and perceived consequentiality, particularly when there were low levels of information on the asset being valued. We hypothesise that policy news, by emphasising the policy relevance of the scenario being valued, acts to prompt non-users to take more care when specifying their willingness to pay, which in turn increases the confidence of their response.

These scripts were found to provide valuable insights into accuracy and realism of the scenarios being valued, providing feedback which can support the robust elicitation of non-use value in contingent valuation studies.

Experiment 2: duration and frequency

This experiment, again with a focus on the Natural History Museum, was motivated by the need to understand how contingent valuation survey design choices 鈥� specifically the payment vehicle (voluntary donation and increase in taxes), the duration of payments (one-off, annual, and indefinite), and the frequency of payments (monthly, annual) 鈥� influence elicited non-use values. Choosing the optimal payment vehicle, duration, and frequency is generally not a straightforward decision and involves the balancing of many factors to ensure the presented payment scenario is as realistic and accurate as possible within the context of the asset being valued.

The results from this study showed that non-visitor WTP is highly sensitive to both the duration and frequency defined in the payment vehicle framing:

• Implied non-visitor WTP was found to be highly sensitive to payment frequency, with monthly frequencies found to be associated with WTP amounts many multiples higher than for annual frequencies when aggregated.
• The one-off donation arm (shortest duration) was found to elicit lower non-visitor WTP values than both the 3-year duration and indefinite duration arms when aggregated.

We also found there to be no difference in non-use WTP values for voluntary versus mandatory payment mechanisms, finding that the WTP from an annual donation for three years was not statistically different to the WTP from an annual tax for three years.

Experiment 3: Distance-decay effects and household framing

There are many uncertainties when applying non-use values in business cases, including that the catchment area is subjective and may vary from site to site, which risks under or overestimating the non-use value if unrealistic catchment areas are chosen. This experiment, with a focus on three UK-based museums (the Natural History Museum, the Museum of Liverpool, and the World Museum), has sought to explore how non-use value varies with proximity to museum assets to determine if this provides any insights into appropriate catchment. To our knowledge this is the first application of distance-decay analysis to non-use value in the context of culture and heritage in the UK, providing new insights into how non-use value varies in relation to proximity to assets. The study further explores how elicited non-use value varies depending on if a household or individual level framing for the payment is used.

Our analysis of distance-decay of non-use value indicates that the relationship between non-use value and distance is complex and non-linear; whilst non-use does generally decrease with proximity for the first 100-200 kms it can then increase again with greater distances to the three museums studied here. The reasons behind this non-linearity are currently unclear and may benefit from further research. We anticipate that the rate and profile of distance-decay for non-use value is likely to be asset-specific which makes it challenging to come up with a hard rule around the cut-off for catchment, although a conservative approach could be to draw the boundary at the point at which the non-use value taper fully levels off.

Our analysis of household versus individual framing for the WTP elicitation found that framing the WTP question on a household basis elicited more conservative estimates of non-use value. We theorise that by requesting that respondents answer on behalf of others, including dependents, it may prompt them to more carefully consider their budget constraints (in a similar way to cheap talk scripts), which may in turn lead to more conservative WTP responses. Realism may also factor into the decision between household and individual framing.

Experiment 4: Non-use value for marginal changes

This experiment explored the elicitation of non-use value for three marginal change scenarios based on reductions in the NHM鈥檚 scope (existence), reductions in the scale of community and outreach services (altruistic), and changes in the duration of future museum maintenance (bequest). Survey arms also explored the impact of doubling the size of each marginal change and how non-use value differs between users and non-users.

The experiment yielded the following headline results:

• Positive estimates of non-use value were elicited for all three marginal change scenarios
• Non-use value for users was found to be higher than that for non-users across all survey arms
• Doubling the magnitude of each marginal change was not found to have a statistically significant impact on non-use value for any of the three scenarios valued

These results provide evidence that individuals hold positive WTP for all three of the existence, altruistic, and bequest forms of non-use value.

A lack of consistency in respondents鈥� valuations of the marginal changes suggest that individuals struggle to disentangle their valuation for aspects of an asset from that of the whole asset, potentially providing evidence of scoping effect or warm glow effect inherent in the wider stated preference valuation literature. We recommend exploring discrete choice modelling as a potential option for quantifying the non-use value associated with marginal changes to culture and heritage assets and further qualitative research to more fully understand issues related to scoping and warm glow effects.

Wellbeing valuation for non-use value

One method for measuring value in culture and heritage that has been growing in popularity, particularly through the past decade, is wellbeing valuation. Although wellbeing valuation has not previously been used to isolate non-use value, it presents a potential avenue to capture non-use value in future research. As far as we are aware this is the first study to attempt to directly value non-use through the wellbeing valuation method. The results suggest that it is possible to collect robust data on wellbeing in online studies and we find, in line with the literature, that visiting cultural sites has a positive association with life satisfaction.

Measuring non-use value is difficult in wellbeing valuation due to the fact that it is difficult to observe changes in non-use of cultural assets in wellbeing data. In this study we used a novel approach to non-use value in wellbeing valuation by assessing the effect on wellbeing of the permanent closure of cultural sites that people know about but do not use. However, we did not find any meaningful statistical effect on life satisfaction, which means that we cannot value non-use using this method and therefore we tentatively conclude that wellbeing valuation cannot be used to robustly value non-use of cultural and heritage sites and asse