In Italy, as in many other European countries, the performing arts are
publicly subsidised. Italian subsidisation is ensured by a Parliamentary Law
that in 1985 established the Fund for the Performing Arts (FUS). The main aim
of this research is to measure the impact of the FUS allocation on the
technical efficiency of Italian performing arts firms, since firms that
received less or no public funds can be either more or less efficient. In the
first case in order to stay in the market, in the second case because public
funds guarantee more income to them. Data are derived from the ORBIS dataset
carried out by Bureau van Dijk over the period 2005-2014. Preliminary results are
obtained by applying the recent stochastic production frontier techniques for
panel data and they confirm our hypotheses. Although our primary efficiency
determinant of interest is the public funding, other efficiency determining
variables are also examined such as immaterial assets, labour cost, firm
characteristics (legal status, size, group affiliation and age, local
environment (rule of law and crimes) and localization area. The impact of
public funds on the technical efficiency of performing arts firms, as
predicted, is relevant for what concerns the whole sample of the performing
arts companies, whilst gives differentiated results at the four territorial
areas level, asking for further estimations.