The Library Dividend

Library Valuation Calculator

Mark Donaldson

SGS Economics & Planning

Libraries...the fourth RState Library of Queensland 18th Sept 2012

• Valuation Elements

• Measurement Techniques

• Case Study to Non-case Study Valuation Process

• Tour of Library Valuation Calculator

Outline of Presentation

Cost Benefit AnalysisBenefits

Less Costs

Equals Net Benefits

Economic Impact AnalysisDirect stimulus

Plus indirect (flow ion effects)

Total induced economic activity

These valuations elements were assessed by using:

The Library Statistical Bulletin

User & Non-User Surveys

SGS in-house modelling processes

Valuation Elements

Do public libraries provide a net benefit to the Queensland community?

How much economic activity do libraries induce in their local economies?

CBA - Benefits

Benefits

Use

Direct use ...access to library resources/ services...social interaction

Indirect use

...sense of place and local amenity

...environmental savings

...contribution to literacy

...contribution to education, career & health

Non-useOptionLegacy

Existence

...for future use

...for current and future generations

CBA - Measurement Techniques

Benefits

Use

Direct use Travel cost Financial savings

Contingent valuation –

usersIndirect use

Non-useOptionLegacy

Existence

Contingent valuation – non-users

Deduced from your behaviour

CBA - Measurement Techniques

Informing Questions:

Travel Cost

• How far do you travel to the library?• How many different places do you access on a visit to the

Library?• What are your out-of-pocket travel costs for a typical trip

to the library (e.g. fares & parking)?• How do you travel to the library?• How long do you spend in the library?

CBA - Measurement Techniques

Benefits

Use

Direct use Travel cost Financial savings

Contingent valuation –

usersIndirect use

Non-useOptionLegacy

Existence

Contingent valuation – non-users

Deduced from your behaviour

Deduced from your perceived induced savings

CBA - Measurement Techniques

Informing Questions:

Financial Savings

•Thinking about your typical library usage over the past twelve months, what do you estimate it would have cost you if you had to pay for the services from private businesses?

CBA - Measurement Techniques

Benefits

Use

Direct use Travel cost Financial savings

Contingent valuation –

usersIndirect use

Non-useOptionLegacy

Existence

Contingent valuation – non-users

Deduced from your behaviour

Deduced from your perceived induced savings

Deduced from the amount you would be willing to spend to access the service were it not free

CBA - Measurement Techniques

Informing Questions:

Contingency Valuation

•User Survey: Thinking from the broader community perspective, if the public library was not funded by government, how much would you be willing to pay to maintain the community’s access to the current services?•Non-user Survey: Thinking from the broader community perspective, if your local public library service was not funded by government, how much would you be willing to pay to maintain the community’s access to the current services?

Cost Benefit AnalysisBenefits

Less Costs

Equals Net Benefits

Economic Impact AnalysisDirect stimulus

Plus indirect (flow ion effects)

Total induced economic activity

These valuations elements were assessed by using:

The Library Statistical Bulletin

User & Non-User Surveys

SGS in-house modelling processes

Valuation Elements

Do public libraries provide a net benefit to the Queensland community?

How much economic activity do libraries induce in their local economies?

Direct Impacts• Recurrent costs of operations• Triggered user expenditures

Indirect Impacts

Total Impacts• Local employment• Local value added• Local output

EIA - Measurement Techniques

Informed by User Survey question:

In the past year, have you made any purchases that were prompted by your use of the library service?

SGS Local Econometric Model

• Derived from the ABS Publication: 5209.0.55.001 - Australian National Accounts: Input-Output Tables

• SGS manipulate the tables using population and employment statistics from the ABS to generate regional IO tables for each library service.

• The regional IO tables were utilised to generate industry multipliers – used to track economic impacts of the library operating costs and the triggered purchases.

EIA – Local Econometric Model

Case study library services

Case study Segment population

Brisbane

Sunshine Coast

Fraser Coast

Mackay

Goondiwindi

Paroo

Mount Isa

Metropolitan

High Growth Centre

Disadvantaged Centre

Regional Centre, Stable Population

Small Rural Community (10-25,000)

Declining Community (<5,000) Resource Segment

Known Information• Recurrent costs of operations (Source: Statistical Bulletin)• Population (Source: Statistical Bulletin & ABS)• Membership (Source: Statistical Bulletin)• Visits (Source: Statistical Bulletin)• Calculated economic multipliers (Source: SGS Econometric Model)

Derived from Case Studies• Library user willingness to pay for the service• Library non-user willingness to pay for the service• Financial savings to library users• Time spent at the library & travelling to the Library• Cost of travelling to the library• Triggered purchases (for economic impact modelling)

Case Study to Non-case Study Valuation Process

Case study allocation

Group 1 Group 2 Group 3 Group 4 Group 5 Group 6 Group 7

Metropolitan Regional, Stable

population

High growth Disadvantaged centre Small rural

community

Declining

community

Resource segment

Brisbane (C) Mackay (R) Sunshine Coast (R) Fraser Coast (R) Goondiwindi (R) Paroo (S) Mount Isa (C)

Gold Coast (C) Toowoomba (R) Cairns (R) Blackall-Tambo (R) Balonne (S) Diamantina (S) Banana (S)

Ipswich (C) Rockhampton (R) Whitsunday (R) Bundaberg (R) Burdekin (S) Barcoo (S) Barcaldine (R)

Logan (C) Scenic Rim (R) Lockyer Valley (R) Cassowary Coast (R) Hinchinbrook (S) Boulia (S) Burke (S)

Moreton Bay (R) Tablelands (R) Townsville (C) Cook (S) Flinders (S) Bulloo (S) Central Highlands (R)

Redland (C)     Gympie (R) North Burnett (R) Carpentaria (S) Isaac (R)

      South Burnett (R) Somerset (R) Cloncurry (S) Western Downs (R)

      Southern Downs (R) Charters Towers (R) Croydon (S) Gladstone (R)

      Torres (S) Longreach (R) Mornington (S) Weipa (T)

        McKinlay (S) Winton (S) Maranoa (R)

        Murweh (S)    

        Quilpie (S)    

        Richmond (S)    

        Etheridge (S)    

Library Valuation Calculator - Input

Library Valuation Calculator - Output

Known Information• Recurrent costs of operations (Source: Statistical Bulletin)• Population (Source: Statistical Bulletin & ABS)• Membership (Source: Statistical Bulletin)• Visits (Source: Statistical Bulletin)• Calculated economic multipliers (Source: SGS Econometric Model)

Derived from Case Studies• Library user willingness to pay for the service• Library non-user willingness to pay for the service• Financial savings to library users• Time spent at the library & travelling to the Library• Cost of travelling to the library• Triggered purchases (for economic impact modelling)

Case Study to Non-case Study Valuation Process

Questions