Making sense of art and design industries

by wkandinsky

Kristiansand has decided to turn an old factory building into an art museum and the population is polarized about the idea. Kunstsiloen costs 600 million NOK to make and is the result of investor Nicolai Tangen having so much art that he wanted to give it to the city as a gift.

However, most of the financing of Kunstsiloen occurs through public funding at state, reginal and municipal level. Thus some people feel like its not really a gift since its being paid for, and argue the money should be prioritized elsewhere such as for children. There was even a petition against it.

Obviously the public institutions funding this project, such as Kulturdepartementet and the Municipality of Kristiansand, are still positive about it. What is the reason they chose to go through with this project despite the public’s opinion? I will try to explain this through the Public Interest Explanation.

The authorities sees this as a public good. In order for the project to go through the government has to spend tax money on it. It is still not a pure public good, as visitors will have to pay for the tickets.

Although it is clear that a lot of the population is not interested in the museum, the authorities doesn’t believe the consumers know this merit good’s true benefit. It therefore has to take responsibility.

Authorities believe that turning and old factory into a modern art museum will have positive externalities in the area around it. For example effects on local tourism and gentrification.

All of these factors combined indicates a market failure, where the government steps in to correct it. Nicolai Tangen himself says that he did not realize he was interested in art at first, but being exposed to it many times made him change his mind. I guess we’ll see if the people of Kristiansand will have the same travel up the cultural ladder.

https://www.nrk.no/sorlandet/na-blir-det-kunstsilo-i-kristiansand-1.14598021

https://www.nettavisen.no/okonomi/milliardaer-skyter-inn-100-mill-i-omstridt-kunstsilo-prosjekt/3423690739.html