The Economic Environment of Business (Museums) Essay

The Economic Environment of Business (Museums) - Essay ExampleMost museums around the world be charging entrance fees as it is the norm. This follows afterwards several attempts by nations like Germany, France, Sweden, and Salvador tried free admission, but the project failed. Unlike other nations which put one across faltered in the free entry of museums, the United demesne (UK) has excelled in the last 10 years. The government use free admission as business office of the government plan to broaden accessibility of the countrys heritage and culture. Free admission has been found to immensely increase the visitors numbers who visit the museums. UKs culture Secretary Chris Smith argued that free admission would pronounce a new beginning for the arts and cultural life of this country. This has opened gates for the quite a little who argon entering the museums. Consequently, free entry has been the key to attracting plurality from all ages and across the divide. In the US entran ce to the museums has long been free, but there are certain private museums that have exorbitantly high charges and people still pay. This shows citizens are not discouraged by charges if the destination is good. Free entry has altered the image of museums because venues are staging a broader variety of exhibitions so as to bring in new people. However, the problem still remains that it can prove to be a challenge where the states funds are stretched to the limit. Consequently, most nations have made entry to museums chargeable. As noted by (Silito, 2011) some museums in Britain still charge including Cabinet War Rooms, regal War and Tate St. Ives. Discussion Museum visits Museums take various organizational forms. Museums are private non-profit organization, private profit firms, or public organizations operated in a non-profit manner. Johnson and Thomas (2008, p. 78) prefigure out that non-profit organizations were established as result of satisfied demand for public goods. Mus eums cost structure is also responsible for establishment of non-profit firms. According to Frey and Meier (2006, pp.1020-21) assert that museums have two types of demand private and public demand. Private demand is exerted by visitors who visit the museum as a leisure activity or as part of their profession. The core determinants relating to price or costs include, (1) admission fee the demand for museum services are price inelastic (2) chance cost of time individuals who are self employed or with higher income have a higher opportunity cost of time, compared to low income persons or with fixed working hours, thus are expected to visit museums more often (3) Price of alternative activities. The social demand gos the society beyond the experiences of the actual museum visitors themselves. The social effects include externalities and influence on the market. The external effects include education, prestige, existence and bequest values (pp.1023). The market effects include creating job opportunities and generating commercial revenue (pp.1024). In addition, museums disaccord from other organizations in the services due to the following determinants high fixed costs, the marginal costs are close to zero, are characterized with dynamic costs, and high opportunity costs. With regard to high opportunity cost Frey and Meier (2006, p. 1028) argue that museums understate their true capital costs by not taking into consideration the opportunity