Income Policies of Public Museums

The study of museums is an essential topic in the sphere of cultural economics. Museums as a typical form of cultural organization also produce economic values, such as externalities. Moreover, museums as merit goods also have the social educational value and it preserves the cultural heritages. Because of the nature of merit goods, the pricing for the entry of museums is always a controversial issue. In one way, as a form of educational and social-cultural group, museums should aim at maximum access to citizens by lowering admission charge or even free of charges. On the other hand, museums have to also avoid losses in financial aspect. The aim of this thesis is to discover how to attract more visitors and how to obtain more income for public museums. Nowadays in China, due to the reduction of the government subsidies, public museums are encouraged to seek innovative and entrepreneurial solutions to gain more income. The Shanghai museum is a successful example that achieves in balancing money-earning and attracting visitors. By conducting the case study of the Shanghai Museum, the results reveal that opening theme restaurants, souvenir shops inside museums, licensing the publications of their exhibitions, obtaining more private donations and commercial sponsorships as well as business partnership are diverse sources to procure more income. Moreover, examples of attracting more museum-visitors and of enhancing their ‘willingness to pay’ and ‘willingness to visit’ are: to practice innovative pricing policies, improving the quality and content of exhibitions, offering more free related services, organizing more educational programs, and arranging more diverse social activities. The enhancement of the ‘willingness to pay’ and the ‘willingness to visit’ can give rise to more income for public museums.