In our study of the theatre, we are examining what has happened to the economic condition of the live professional theatre in America over the past ten-odd years. We are investigating whether or not the cost-revenue squeeze diagnosed by Baumol and Bowen has become progressively worse, as they predicted, with all the attendant adjustments this would necessitate. We are also examining some of the factors that could account for the patterns in the economic condition of the theatre that we observe over the last decade.

The theatre is particularly interesting in this regard because, unlike the other traditional live performing arts, theatre is produced by both for-profit and not-for-profit organizations. We should expect to see particularly dramatic responses to economic factors in the case of for-profit producing organizations, for these are ineligible for any significant form of philanthropy.

The data we are examining show, somewhat surprisingly, that theatre activity has been stable or has grown over the last decade. (p. 63)

In our study of the theatre, we are examining what has happened to the economic condition of the live professional theatre in America over the past ten-odd years. We are investigating whether or not the cost-revenue squeeze diagnosed by Baumol and Bowen has become progressively worse, as they predicted, with all the attendant adjustments this would necessitate. We are also examining some of the factors that could account for the patterns in the economic condition of the theatre that we observe over the last decade.