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This article was downloaded by: [Ecole Hautes Etudes Commer-Montreal] On: 22 July 2014, At: 16:40 Publisher: Routledge Informa Ltd Registered in England and Wales Registered Number: 1072954 Registered office: Mortimer House, 37-41 Mortimer Street, London W1T 3JH, UK International Journal of Cultural Policy Publication details, including instructions for authors and subscription information: http://www.tandfonline.com/loi/gcul20 Comparative analysis of French and French Canadian willingness to support the national film industry Dominique Bégin a, François Colbert a & Ruth Dupré a a École des Hautes Études Commerciales de Montréal, Canada Published online: 24 Feb 2009. To cite this article: Dominique Bégin, François Colbert & Ruth Dupré (2000) Comparative analysis of French and French Canadian willingness to support the national film industry, International Journal of Cultural Policy, 7:2, 355-368, DOI: 10.1080/10286630009358150 To link to this article: http://dx.doi.org/10.1080/10286630009358150 PLEASE SCROLL DOWN FOR ARTICLE Taylor & Francis makes every effort to ensure the accuracy of all the information (the Content ) contained in the publications on our platform. However, Taylor & Francis, our agents, and our licensors make no representations or warranties whatsoever as to the accuracy, completeness, or suitability for any purpose of the Content. Any opinions and views expressed in this publication are the opinions and views of the authors, and are not the views of or endorsed by Taylor & Francis. The accuracy of the Content should not be relied upon and should be independently verified with primary sources of information. Taylor and Francis shall not be liable for any losses, actions, claims, proceedings, demands, costs, expenses, damages, and other liabilities whatsoever or howsoever caused arising directly or indirectly in connection with, in relation to or arising out of the use of the Content. This article may be used for research, teaching, and private study purposes. Any substantial or systematic reproduction, redistribution, reselling, loan, sub-licensing, systematic supply, or distribution in any form to anyone is expressly forbidden. Terms & Conditions of access and use can be found at http://www.tandfonline.com/page/terms-and-conditions

Comparative Analysis of French and French-Canadian Willingness to Support the National Film Industry Dominique Bégin, François Colbert and Ruth Dupré École des Hautes Études Commerciales de Montréal, Canada Members of the cultural sector are using different arguments, including economic arguments, to convince governments that they should pour money into their sector. Economists, sociologists and political scientists have analysed those arguments invoked in favour or opposed to government involvement in the arts. For example, academics such as Heilbrun and Gray (1993), Bakke (1996), West (1985), Carrol (1987), Cwi (1979), Hoskin, McFayden and Finn (1998), Baumöl and Bowen (1984), Globerman (1987), to name just a few, have compared the validity of notions such as 'positive externalities/ 'merit goods,' 'cost disease,' 'small markets' or 'economic impacts including job creation,' and have given the pros and cons of those arguments. Others have put forward counter arguments such as: 'politicians are swayed by the lobbying power of small interest groups, not the general public' (Stigler, 1971); 'even after more than 40 years of public intervention in the arts, the vast majority tickets to classical music concerts are still being purchased by the same highly educated segment of the population' (Zimmer and Toepler, 1996); and 'public subsidies to contemporary art diminish the impact of the market judgment in the short term leaving the real test to an eventual meeting with real general taste and the work of art' (Urfalino, 1989). In spite of these debates, governments have continued to invest public funds into the arts and cultural industries for decades. Cultural Policy, Vol. 7, No. 2, pp. 355-368 Reprints available directly from the publisher Photocopying permitted by license only 2000 OPA (Overseas Publishers Association) N.V. Published by license under the Harwood Academic Publishers imprint, part of The Gordon and Breach Publishing Group. éditions des archives contemporaines Printed in Malaysia. 355

356 DOMINIQUE BEGIN, FRANÇOIS COLBERT AND RUTH DUPRÉ PURPOSE OF OUR RESEARCH Arguments for or against government intervention can in a sense be resolved if taxpayers are willing to see their money put toward a specific cause in this case, the cultural sector. Indeed, perhaps the best argument for public commitment is the wishes of citizens. When taxpayers approve of a government investment, politicians are justified in going ahead. Otherwise, it is the responsibility of those seeking funds to make their case. One would expect populations to be willing to see their taxes serve to help such activities as museums since museums are nonprofit institutions that enjoy fairly wide public acceptance, largely due to the fact they are assimilated into education and education is well regarded by the vast majority of the population. For instance, a study done by the Chair in Arts Management at the École des Hautes Études Commerciales de Montréal, aimed at measuring the importance citizens attach to investment in museums (Martin, 1991), showed that Quebec citizens are willing to give more money to museums than that which they pay through taxes, because they consider that museums play a very important role in the protection of their cultural heritage and because this sector contributes to the general education of children. This study was conducted using contingent evaluation analysis. 1 Having established this, we were interested in investigating citizens' opinions in relation to a more commercial context than that represented by museums. The movie industry is clearly dominated by for-profit production companies. In this current study, we are concerned with respondents' willingness to pay to support an industry that is widely regarded as generating large profits. Moreover, we compare the opinions of moviegoers in two francophone countries that use different systems of financing; in France a set tax is imposed on each movie ticket (11%), on television stations (5.5% of the broadcaster's revenues) and on video producers (2% of revenues); in Quebec, support is provided through grants drawn directly from the governments' general income tax revenues. We thus intended to measure the willingness to pay of current moviegoers in those two countries and the difference in this willingness to pay according to the system (France versus Quebec). More importantly, however, we are interested in the reasons behind this willingness to see tax dollars spent on the cultural sector.

COMPARATIVE ANALYSIS OF SUPPORT TO THE FILM INDUSTRY 357 Our decision to compare France and Quebec was motivated by the fact that France has always presented culture as the flagship of its international offensive, just as the protection of national culture has always been a major concern in Quebec; and by the fact that both are francophone territories that always felt that their cultural specificity was threatened by American feature film productions invading their market. GENERAL PROFILE OF THE FILM INDUSTRY IN FRANCE AND QUEBEC The Canadian Situation As the international readers of this review are probably not as familiar with Quebec as they are with France, it might be useful to first very briefly describe the Canadian situation. Canada is divided into ten provinces and two territories and has a population of 30 million people, most of whom are concentrated in three major metropolitan regions: Montreal, Toronto and Vancouver. Francophones account for less than 25% of this population and are concentrated in the province of Quebec, a small, predominantly French-speaking island' of seven million people lost in a sea of over 300 million Anglophones representing English Canada and the USA. Most of the Canadian population lives within a few hundred kilometres from the American border, a border approximately 6,000 kilometres long. Some observers say the Americans look upon Canada as merely another state within the Union. Protection of Canadian culture is unsurprisingly a subject of perpetual debate in Canada, and attempts to establish protective measures against the so-called invasion of American cultural products are continually at the forefront. These same debates also preoccupy the people of the province of Quebec, where they are often linked to a broader discourse based on the desire of part of the population to separate from the rest of the country. In Quebec, a large proportion of the population is not fluent in English, creating a language phenomenon that actually constitutes a sort of barrier to the consumption of American cultural products. This is particularly true in the fields of theatre and television programming; in the latter instance, local productions boast a large share of the audience. On the other hand, the English-speaking part

358 DOMINIQUE BEGIN, FRANÇOIS COLBERT AND RUTH DUPRÉ of the country finds itself dealing with the exact opposite situation: a large majority of viewers watch American channels. It is worth noting, however, that French-speaking consumers buy mainly foreign popular music, films and books; indeed, French versions of American films and books are usually available on the market very soon after their launch in the United States. The Film Industry in France and in Quebec Interestingly enough, Quebec produces more films per capita than France (4.3 films per million people in Quebec versus 2.8 per million in France). Of course, given the difference in the size of the population, respectively at 7.7 and 53 million, the French annual production of films is five times that of Quebec. Indeed, with an annual production of 150 feature films between 1984 and 1993, France is the most important producer and coproducer of films in Europe (Creton, 1994). In 1997, 163 films were released, representing a total investment of 4.6 billion francs, of which 1.2 billion came from public sources. Most of the production companies are small enterprises that release only one film on the market each year; the 20 larger production companies account for the majority of films produced. The market share of French films on the national territory was 37.3% in 1997 while American films accounted for 54.7% of the market. As Table 1 shows, this is one of the highest proportion occupied by national movies in the world. After the U.S. where the proportion is 98%, only France and Japan have a share larger than a third. In Quebec, the annual number of feature films produced is in the order of 30 to 35. The market share of Quebec film productions was 2.7% in 1997; films produced in France occupy 4.5% of the market and American productions some 87% of revenues. Quebec looks in this respect like small countries such as Belgium or the Netherlands (see Table 1). Among the 50 most successful feature films presented in the province between 1995 and 1997, only four were not American and only one was a native Quebec production. It is rare for a Canadian feature film to reimburse even a small portion of the public investment made on a recoupment basis. The exhibition sector in France and in Quebec is comparable with some differences. According to Creton (1997), there were in France in 1996, 2,139 theatres, 4,519 screens for an average attendance of

COMPARATIVE ANALYSIS OF SUPPORT TO THE FILM INDUSTRY 359 TABLE 1 An international comparison of the film market shares, 1997 Country Market Share of National Market Share of U.S. Movies [in % of revenues] Movies [in % of revenues] France 37.3 54.7 Quebec 2.7 87 U.S.A. 98 98 Belgium 2.5 73.7 Germany 15.7 75.1 Italy 24.9 59.7 Japan 36.3 60.5 Netherlands 5.4 84.1 Spain 9.3 78.3 Sweden 9 67.5 U.K. 12.8 81.7 Source: Siroën (1999:17). 30,117 per screen and a per capita attendance of 4.6 annually; this compares to the province of Quebec where in 1995 there were 126 theatres, 434 screens for an average attendance of 42,279 per screen and a per capita attendance of 2.5 annually (Statistics Canada, 1997). Public Film Policy in France and in Quebec In both communities, the film industry is supported by a set of governmental measures. In France, the Centre National de Cinématographie (CNC) manages the special financial fund for the film industry, the Compte de soutienfinancier.as we saw, the fund is financed by a special tax on tickets (11%) and a contribution from the television and video industries. Producers, distributors and cinema owners receive an automatic grant proportional to their contribution to the Compte de soutien financier and a selective amount, mostly as an advance on anticipated revenues. Tax deductions for the SOFICAS, those specialized financial organizations which promote investment in the film industry, also play a major role. Finally, regulation is also used as an instrument to encourage domestic production. National television channels have to broadcast a minimum of 40% of French and 60% of European productions. Canada also has various legislative measures aimed at supporting its cultural sector, including imposing a minimum percentage

360 DOMINIQUE BEGIN, FRANÇOIS COLBERT AND RUTH DUPRÉ of Canadian content in media programming, as well as providing direct support to the field. A governmental agency called the CRTC (Canadian Radio-Television and Telecommunications Commission) regulates Canadian content on the air and in the magazine business. Arm's-length agencies such as Telefilm Canada and the Canadian Television Fund distribute grants to support the development of film and television programming. There are also tax credits. In addition, the province of Quebec has various departments and agencies through which it intervenes in the cultural sector. For the film industry, the main agency is the Société de développement des industries culturelles et des communications (SODEC). Film producers living in Quebec can, and do, knock at the door of both levels of government in search of support, allowing them to benefit from provincial as well as federal funds. In 1997, the total amount of public spending for feature films was about 1.2 billion francs in France and some ISO million Can $ in Quebec. To compare the extent of financial support in the two communities, we have to look at these figures in per capita terms and in the same monetary unit. Converted at the rate of 4 FF = 1$, this represented $5.60 in France and $6.75 in Quebec. Quebec was thus spending three times more than France, once adjusted for the population. METHODOLOGY In order to obtain the necessary data, we used a convenient sample of moviegoers chosen at random in two cities: Paris and Montreal. This category of consumers represents an important segment of the population in both countries, with 57% (1997) of French population and 59% of Quebec population (1994) being moviegoers. The survey was conducted directly at movie theatres; before the presentation of the movie, we interviewed an average of five consumers in 28 different theatres in Paris in September 1998, and in 24 different theatres in Montreal in December 1998 and January 1999. The movie theatres were selected in different districts in each city in order to cover the entire territory. All films were either of French or French-Canadian origin, or a French version of a foreign production; they represented a broad spectrum of topics and genres. The same interviewer administered a questionnaire to 130 respondents in Paris and 123 respondents in Montreal. In both cities,

COMPARATIVE ANALYSIS OF SUPPORT TO THE FILM INDUSTRY 361 the respondents, aged 15 or over, were chosen at random before the showing of the film. The questionnaire was slightly different in each city, in order to take into account the specific system of government intervention in France and in Quebec/Canada. Despite these slight variations, however, the questions still allow us to compare the two populations. Both questionnaires were pretested before being administered. In our Quebec sample, 29% of respondents report going to the movies more than 52 times a year, 42% between 12 and 51 times, and 28% between 1 and 11 times. In France, these proportions are 26% for those who go to the movies more than 52 times a year, 47% between 12 and 51 times, and 27% between 1 and 11 times. The fact that there are two main categories of frequent moviegoers is well documented in the literature (see, for instance, Conseil de l'europe, 1991; Creton, 1994); they are the category of 15 to 25 year-olds and the well-educated segment of the population. It is not surprising then that young people are over-represented in our sample compared to the general population (Table 2), and that university graduates make up a strong portion of our sample, 31% in Quebec and 56% in France. 2 The results of this study must be interpreted with caution, as our sampling method does not allow us to extrapolate the results to the entire population of moviegoers. Nor can we claim that these findings represent the views of the general population. The best we can say Gender TABLE 2 Comparative characteristics of the general population and the sample Characteristics Men Women France General population 48.5 51.5 France Sample % 56.9 43.1 Quebec General population 49.3 50.7 Quebec Sample % 52.8 47.2 Age Under 15 years old 15-19 20-24 25-34 35-49 50-59 60 + 12.7 7.2 6.6 15.8 23.6 11.9 22.2 0.0 10.8 23.1 30.8 16.9 11.5 6.9 18.5 6.7 6.7 14.4 25.2 11.9 16.6 0.8 8.1 28.5 22.0 26.8 6.5 7.3

362 DOMINIQUE BEGIN, FRANÇOIS COLBERT AND RUTH DUPRÉ is that we have a comparison between the opinions of moviegoers in the two largest francophone cities in the world (Montreal and Paris). We therefore prefer to look upon this as an exploratory study, even though the overall sample is statistically significant. The fact that the interviewers were required to interview only five customers per movie theatre may skew the sample; however, the reader should note that the interviews were all conducted by the same person. Another possible bias of the study concerns the questions related to the willingness of respondents to see more of their taxes go to the film industry and, especially, to add a new tax or increase an existing tax on each ticket. Since this possibility is theoretical and does not require the respondent to commit immediately, it may increase the probability of a positive answer, and in doing so, overestimate the results. In future research, we intend to test the hypotheses generated by the current study on a representative sample of the general population. This would not only permit us to validate our results, but it would also allow us to survey the segment of the population who are not moviegoers. RESULTS 1. Willingness to Pay The basic purpose of the study was to determine whether respondents are willing to pay taxes to encourage local feature film production, and, if yes, to discover the reasons for their attitude. We asked the respondents to indicate if they agree with the principle of handing over taxpayer dollars to the film industry. Moviegoers from Quebec agree with this principle in a proportion of 91%, while 5% are against and 4% do not know. In France, 84% of respondents agree with this principle, while 11% do not agree and 5% do not know. Our survey findings indicate not only that respondents agree with the principle that a portion of their taxes should be distributed to the film industry, but, more importantly, that they would accept an increase in the funding of feature film production. We documented this aspect in two ways: we asked respondents to indicate if they

COMPARATIVE ANALYSIS OF SUPPORT TO THE FILM INDUSTRY 363 would be prepared to pay more for their movie ticket in order to include a special tax (or to increase the current tax in the case of French spectators), and if they would accept an increase in their income tax (in Quebec) or in the television tax (in France) in order to support the film industry. In Quebec, the average increase moviegoers would be willing to pay on their ticket price is $1.25 (the average ticket price is $8); interestingly enough, only 9% would not go to movies if the ticket price were increased. In France, the acceptable average increase on the ticket price was 4.04 francs ($1.01), which represents a doubling of the current tax on ticket price. We also asked respondents if they are satisfied with the proportion of their income tax that is directed to the film industry. To help respondents give an informed opinion, the interviewers had on hand figures indicating the approximate amount of income tax paid per income category and the average amount spent on the film industry per taxpayer. A total of 43% of our Quebec respondents consider this level to be satisfactory, 43% consider it to be too low, and only 3% find the amount too high. The average amount of income tax distributed to the film industry is $13.83 per citizen; respondents are, on average, prepared to see this amount double. In France, the government charges 30 francs per taxpayer in the form of a special tax on television ownership. Asked whether they are satisfied with the level of this tax, 35% of the French respondents consider that the amount of the special tax distributed to the film industry is satisfactory, 25% believe it is too low and 11% find it too high (29% did not answer the question). The French respondents were, of course, given an indication of the level of this special tax. On average, respondents who are willing to pay more would give 32.92 francs on top of the current amount, while even those who are not willing to pay more would nonetheless accept an increase of 10.50 francs. The survey also asked respondents in both countries to indicate if they go to the movies to see domestic films, the aim being to determine whether interest in local productions has an impact on moviegoers' willingness to pay more taxes to the film industry. The responses indicate that French viewers attend locally produced films in a greater proportion than Quebec respondents. In Quebec, only 20% of the sample indicate that they go to Quebec-made movies often or very often, while in France, this proportion is 45% (the reader must remember there are more French films available per capita because of greater number of French films produced). As we can observe, the fact that only a minority of moviegoers are interested in

364 DOMINIQUE BEGIN, FRANÇOIS COLBERT AND RUTH DUPRÉ domestically produced films does not prevent them from according importance to funding of the film industry. We were also eager to investigate the perception of moviegoers with regard to the profitability of the movie industry. We suspected that taxpayers would not be willing to see their tax dollars (or francs) go to an industry that makes profits. Approximately half of the French audience believes that the film industry makes a profit on films, while this proportion is only 40% in Quebec. Again, it is interesting to note that this belief does not detract from moviegoers' willingness to support their respective industry. In fact, 47% of Quebec respondents and 24% of French respondents are convinced that their film industry would not survive without government support, while 32% of Quebeckers and 20% of the French believe the industry would face serious difficulties without such funding. Those who are unwilling to see their tax dollars go to the movie sector believe that film producers can survive on their own in the market and that it is not the role of the State of fund this type of industry. 2. Arguments for Public Investment in the Film Industry In order to find out why moviegoers believe governments should invest in the film industry through grants to producers, we asked respondents to indicate the main reason they would present to their constituencies in order to justify their position on this issue if they were members of parliament (Table 3). The top argument on the list of reasons for both countries is the protection of their respective culture. Arguments relating to job creation, reduction of ticket prices or economic impact did not show up in the results. From the data, we can identify certain differences in the two populations under study. First, although the main argument in both countries, there is a difference in the respective percentages of respondents who cite protection of national culture as a justification for government subsidy of the film industry (47% in Quebec versus 35% in France). The second most frequent reason given is, in the case of Quebec moviegoers (24%), the long-term survival of this industry, while in France it is to favour diversity in film production (23%). These differences could be attributed to two factors. First, the French film industry enjoys a significantly higher share of the market than the Quebec industry; as such, it is understandable that French moviegoers would show greater interest in the diversity of

COMPARATIVE ANALYSIS OF SUPPORT TO THE FILM INDUSTRY 365 TABLE 3 Most frequent reasons cited to justify subsidies to the film industry: A comparison of France and Quebec France % Quebec % Protect the long-term survival of the industry Protection of national culture Improve quality of films Lower ticket prices Favour diversity of film offerings Favour the teaching of cinema in school Other None 16% 35% 9% 7% 23% 4% 3% 3% Protect the long-term survival of the industry Protection of national culture Improve quality of films Lower ticket prices Favour diversity of film offerings Favour the teaching of cinema in school Other None 24% 47% 17% 2% 4% 2% 2% 2% the films offered. On the other hand, the Quebec industry's position in the market is much less comfortable, even more so considering the particular geographic situation of Quebec society. Indeed, the fact of existing in a sea of 300 million anglophones in a territory far removed from any other country and, thus, other cultures may bestow a sense of fragility on an industry that is seen as important for the preservation of Quebec culture. The arguments cited by the respondents can perhaps be summarized in two categories. A first category can be linked to the presence of positive externalities as identified by moviegoers. Protection of one's national culture and favouring film education in school seem to be two reasons that can easily be considered to fall under this category of argument. Respondents in this category agree that the film industry has a role to play in strengthening national identity; in doing so, they imply that it plays a social role that may benefit society as a whole through social interaction between those who consume and those who do not consume cinema. The second argument falls under the category of market characteristics as defined by Hoskins, McFayden and Finn (1998). The domestic market in the case of Quebec is small and seen as barely capable of sustaining a viable industry. When accepted by taxpayers as a valid argument, this may become a powerful argument when linked to the first one. The case of France is less clear; the population is larger

366 DOMINIQUE BEGIN, FRANÇOIS COLBERT AND RUTH DUPRÉ (58 million), with the result that the market can accommodate a greater number of productions, especially when attendance at local films is at an acceptable level and domination by the American industry is less evident. CONCLUSIONS In general, our results show that moviegoers in the province of Quebec and in France agree with government subsidy of the film industry and are willing to pay more in taxes to support the national film industry than that which is already spent on their behalf by their respective governments. The main argument to justify supporting the national film industry in both countries is the protection of national culture; this argument enjoys strong support among both populations. This argument falls under what Heilbrun and Gray (1993) describe as positive externalities linked to national identity and prestige; the other categories listed by Heilbrun and Gray are: availability of the good, legacy for future generations, contribution to a liberal education and social improvement of arts participation, encouragement of artistic innovation). Interestingly enough, arguments linked to job creation, heritage protection or the encouragement of artistic innovation (art for art's sake) are not seen as important. * Taken at face value, these findings could imply that the governments of France and Quebec are justified in subsidizing the film industry. However, it is important to remember that even if moviegoers represent a majority of the population (57% and 59% for France and Quebec), the sample was not drawn from the total population; it is also important to point out that the respondents were not asked to prioritize the different sectors benefitting from government support; it would have been interesting, for example, to ask the respondents if they would agree to see their taxes raised in order to support the film industry, or, if not, to have them rank film production compared to health or education as an area of government spending. This raises the question of the extent to which a country's citizens believe public/government funds should be spent on cultural goods. Another issue raised by our data concerns cultural policy methods and regulations. We have seen that the two jurisdictions under investigation use different methods in terms of the funding of their

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