Financing the next big hit or the next big dud

This research explores the relation between subsidies for Dutch feature film production and box office revenues, in the context of policy objectives that have been formulated since 1997. The relation is calculated with use of a correlation analysis in which two types of correlations are used, the Pearson correlation and Spearman’s rho, using subsidy and the production budget as independent variables and box office revenues as dependent variable. The results of the correlation analyses show a positive and significant relation between both independent variables and the dependent variable, but the correlations are too small to conclude that these variables determine revenues alone. At the same time, the required data for these calculations formed an interesting image on the development of subsidy allocation and box office revenues for Dutch film over the last decade. Together with the relevant cultural memoranda and literature on developments in the film industry, the data collection was used to draw conclusions concerning the effectiveness of subsidies in the light of policy objectives. The objectives were predominantly focused on: the increase of production volume; the improvement of quality and commercialization of film; entrepreneurship among producers; and attention to the audience. The main goal was to establish an economic viable film sector. Incentives managed to help increase the production volume of Dutch films, as well as the number of commercial films, but these successes were short-lived. In the end, the Dutch film sector did not become self-sufficient. Policy was focused too much on production and failed to implement measures specifically for demand. However, shifting the emphasis in policy to demand does not guarantee a better result, because all that is certain in the movie business is that nothing is predictable.