I realize that there are some potential holes to be plugged, but I’m interested to know what people think. Is there any reason, besides political will, why something like this couldn’t work in practice?

After reading some of the critiques of the idea in comments and talking to a few other people, I haven’t yet seen anything that makes me doubt its overall feasibility, but it’s clear that the implementation would pose several challenges. Here are the main problems that would have to be overcome, as I see them:

1. Privacy concerns.
   Jodi SC in the comments to my original post raised an expected concern, that she’s “not sure if [she likes] the idea of everyone having a card that classifies them by income.” Maryann Devine mentioned as well that a report on arts participation by college students indicated that they were embarrassed to ask for student tickets at the box office. I suggested that perhaps the Art Card could only be used online, thereby bypassing any personal interaction when receiving the discount and limiting the number of people with exposure to the amount of the discount. On the other hand…
2. The digital divide.
   It’s well known that lower-income people are not only less likely to own a computer themselves but also less likely to have access to credit cards or bank accounts, both of which would be required for online ticket purchases. I suppose the Art Card could work like a charge card that would need to be paid off every month, but that would add a whole other layer of complexity for the issuing body (most likely the city) that doesn’t seem worth the trouble. So, certainly, an online option should be available, but the card will still have to be accepted at the box office in order to promote truly fair access.
3. The potential for fraud.
   The biggest potential issue with price discrimination is that the discount buyer, having received the good, can then turn around and resell it to someone else, thus becoming a direct competitor to the original supplier. So, let’s say we had a program like this in place for the Nintendo Wii. Because I’m po’, I could buy my own Wii for, oh, $120, and then turn around and sell it on eBay for full price, taking profits that arguably should have gone to Nintendo (since I clearly didn’t care enough about the Wii to keep it). Moreover, in theory I could do this many times, enough so that I could establish a side business as a bootleg Wii-seller sucking all kinds of profits from Nintendo. (Of course, if I got rich doing this I would no longer qualify for the discount program, but that’s not an issue in the short term.) The reason this is not an issue for something like college financial aid is because (a) it’s not possible to “resell” one’s college admission, and thus finanical aid package, to another party; and (b) you can’t keep going back to college over and over again to keep getting the “discount.” Now, arts tickets have more in common with the first situation than the latter, but some simple safeguards can protect against this kind of abuse. First, all online purchases with the Art Card could be held at “Will Call,” and the arts insitution could make a policy to ask for either the card or photo ID when picking up the tickets. (This gets in the way of problem #1 above, but you can’t have everything, I guess.) Second, it should be possible to disallow multiple purchases from the same Art Card for the same show (or the same day). That means that couples would have to each apply for their own card, unless there were a “family edition” of the card for married couples filing jointly, perhaps. And then what about the kids? Well, many museums and so forth already have kid-friendly admission prices, so hopefully that wouldn’t be too much of an issue. After that, you run into some questions of fairness–is it right to enable a family of 8 to see a show in a small theater for peanuts and take away other people’s seats, for example? I’m not sure. There would have to be a line drawn somewhere, I would think.
4. Where will the money come from?
   To be sure, organizations could compensate to some extent for the loss of revenue from lower-income customers by raising prices for higher-income customers and tourists. However, there is a limit to how far they can go with this without losing market share to other tourist attractions and cutting into their donor base. I suspect that in order to make the program palatable to arts institutions, the city would have to offer, either directly or indirectly, some sort of subsidy — or perhaps a guarantee of a minimum level of income for the first year or two based on previous years’ performance. This, of course, raises the cost of the program and makes the political challenge harder — hopefully not by that much though.

Taking all of this into account, I’m still not totally sure myself where this idea falls on the continuum between “interesting” and “great,” but I definitely think it is worth discussing, especially as arts institutions around the country struggle with questions of accessibility, diversity, and community relevance. We should give some serious thought to whether these aims would be best accomplished with the current haphazard, every-organization-for-itself approach or a more formal, centralized infrastructure like the one I’ve described.

These strategies are certainly welcome antidotes to the often eye-popping prices of mainstream big-ticket arts events. In essence, arts organizations already pursue price discrimination to a significant degree, making it possible for both high payers and low payers to experience the art by having the former effectively subsidize the latter. But the instruments used to identify such consumers are quite blunt, aren’t they? I mean, take senior discounts for example. Sure, many elderly folks basically live off of Social Security and aren’t in a position to pay $200 for a seat in the orchestra section. But on the other hand, many of the museum’s or the opera’s biggest individual donors are probably over 65. They certainly don’t need a senior discount. Or take the free Fridays – it’s pretty easy to imagine a family that was planning to come on Saturday deciding to go on Friday instead to save some cash. In that scenario, the foundation’s grant amounts to little more than a boost to that family’s expendable income. Is that the most efficient way to accomplish things?

If this is really about expanding access to the arts, why not make tickets income-sensitive? All of this classifying and filtering of customers into students, seniors, non-tourists, etc. basically amounts to a guessing game about their income. If a customer exhibits certain behavior or characteristics, the logic goes, s/he is more likely to be in need of subsidization. But why not just go to the source?

Educational institutions have this down to a science. Instead of guessing about students’ financial situations, they have the students and their parents fill out a series of federal and school-specific forms and submit their tax returns, so as to make a determination about just how much financial assistance each faimly really needs. Invasive? It sure is, but considering the amount of money to be saved, I don’t hear too many people complain about that. And hey, no one’s holding a gun to anyone’s head to apply for financial aid. (For the record, I was able to attend Yale College at an approximately 80% discount thanks to that institution’s generous financial aid program, which has only become more generous in the intervening years. If I were a student there today, my parents probably wouldn’t be paying a thing.)

Here’s how this could work in the arts. A city-wide agency, like the local cultural council, could offer an “Art Card” to all residents. Eligibility would be based on financial aid criteria like that described above, particularly tax returns. This information would be fed into a formula that would then be connected to the resident’s account with the city agency. The Art Card would then act something like a supermarket loyalty card for its holder, with a preset individualized discount off of any posted price for participating organizations. So say I want to go to City Opera. I buy a $50 ticket, present my Art Card to the box office or the website form, and am told that my price for this ticket will be $37.16 based on my personal financial situation. This setup would be expensive to implement, but it would be fundamentally fair — and would have the additional benefits to participating organizations of allowing them to dispense with other hard-to-verify discounts and raise prices on their highest-income customers (just as colleges and private schools have been doing with tuition for years). It also benefits residents and extracts value from tourists, something any local government should be able to get behind. And if institutions are reluctant to play along, the city could always make participation in the program a requirement of receiving grant funds (at least for its largest institutions).

I realize that there are some potential holes to be plugged, but I’m interested to know what people think. Is there any reason, besides political will, why something like this couldn’t work in practice?