This article provides estimates of price and income
elasticities of demand for German public theatre, using a large and reliable
data set for 178 theatres over 40 years (1965–2004). It is posited that the
consumption of the performing arts is a time-intensive activity for which both a
theatre ticket and leisure time are necessary. Thus, the impacts of
‘full-income’ (‘leisure time income’ added to disposable income) and the price
of leisure time on theatre attendance are examined. The findings indicate that
the demand for the performing arts is own-price inelastic. The disposable income
elasticity is significant, positive and equals approximately one. In contrast,
the full-income elasticity is well above one and greater than usual income
elasticity indicating that the performing arts are a luxury good when leisure
time income is included in the consumer’s budget. The positive full-income
effect is, however, offset by the negative price of leisure effect indicating
that leisure time is a complement for the performing arts. Additionally, three
objective quality characteristics of theatrical productions which can positively
influence theatre demand are examined.