Behind the Curtain by Living Opera
Behind the Curtain, hosted by soprano Soula Parassidis and tenor Norman Reinhardt at the beautiful Hotel Bristol in Vienna, is a video podcast by Living Opera that takes listeners beyond the grand performances and into the heart of opera. Through candid, thought-provoking conversations, the podcast reveals insights that transcend the stage, exploring universal themes such as personal growth, leadership, and perseverance. Whether you're a seasoned opera enthusiast or simply curious about how artistry intersects with everyday life, Behind the Curtain offers a unique perspective that bridges the world of performance with real-world challenges and experiences. Watch the video version of this podcast on Living Opera's Facebook and YouTube Channels.
Behind the Curtain by Living Opera
Christos Makridis — Behind the Economics of Arts and Culture
What happens when rigorous economic research meets the world of classical music? Prepare to have your assumptions challenged as Soula Parassidis interviews economist Christos Makridis about his groundbreaking research quantifying the true value of arts and culture in our communities.
With seven degrees (including two PhDs from Stanford) and over 80 published academic papers, Christos brings unprecedented analytical rigor to questions the arts sector has long struggled to answer quantitatively. How much do people actually value living near theaters and cultural venues? The answer, according to his research using sophisticated "hedonic pricing" models: thousands of dollars per year. By analyzing housing market data and controlling for numerous variables, Christos demonstrates that proximity to arts amenities significantly impacts where people choose to live and how much they'll pay for that privilege.
The conversation delves into practical applications for arts organizations seeking to demonstrate their value to potential donors and communities. Drawing on Nobel Prize-winning econometric frameworks, Christos outlines specific strategies theaters can implement to improve operational efficiency, create data-driven forecasting models, and establish meaningful metrics that prove their impact. These approaches don't necessarily require expensive consultants—sometimes just skilled data analysis using publicly available information.
Beyond the numbers, Christos shares a deeply personal perspective on why classical music matters: its physiological impact on listeners and its role in human flourishing and civilization. "What we put into our soul matters even more arguably than what we put into our body," he notes, explaining how his research extends to exploring connections between operatic voices and neural pathways.
For artists questioning their path, his message is clear and hopeful: your work has quantifiable value, there are allies in unexpected places, and every hour invested in your craft contributes to something larger than yourself. Listen now to discover how data can tell the story of why arts matter in ways we've never before been able to measure.
The Behind the Curtain Podcast is hosted by Soprano Soula Parassidis and Tenor Norman Reinhardt. Follow Living Opera on Instagram, Facebook, YouTube, Twitter, and Website.
Watch A VIDEO version of this podcast on Living Opera's Facebook or YouTube Channels.
Hi, I'm So Parasitis and this is Behind the Curtain, and today I'm very excited to talk to my guest, co-founder, best friend and, can I say, right hand, Christos Makridis is here and, Christos, this whole thing wouldn't happen without you and we have to say that, and I want to catch your actual reaction on camera. But you have been such an instrumental part of living opera and I want to thank you for everything that you do to help us, and there's so many people here also behind the scenes today and you have just done an outstanding job and it needs to be said.
Soula Parassidis:So there it is but, that's not the basis of this conversation today. I know you have plenty to get into and if there's anything that you want to say about yourself because if I go through your CV and all the things you do, that will take up the whole interview so tell everybody who you are, what you do and what are we talking about today.
Christos Makridis:Yeah, well, it's really a pleasure to be doing this, because one of the things we've talked about for so many years is the need for democratizing access to classical music, how the sector works, and when I was actually preparing for this, I was like I spend so much time doing research. What's the actual etymology of the word research? And it seems like it comes from—.
Soula Parassidis:That's funny, I never thought about that.
Christos Makridis:Well, I mean you know, I thought it just came from some Greek word, but it actually seems to be like a French word, and the word research is, I mean, to search for something, and I thought more about, okay, the search for truth, the search for understanding. And so a lot of what we've been doing over the past couple of years has been around uncovering, and uncovering takes many different shapes and sizes. Uncovering can come through the heart, which we do through music. It can come through singing, and uncovering can also come through the heart, which we do through music. It can come through singing, and uncovering can also come through quantitative means, being able to look at data and tell a broader story with that data.
Christos Makridis:And so today, I mean part of the exciting news that we have is that Living Opera has been spearheading research around ways of injecting more life into the classical music sector. So what financing strategies might work? What have we not considered before? How much do people value the arts? That's a question that we oftentimes take for granted, because I mean, as a leading opera singer, it's like you kind of take for granted that there is a market for this, but we simultaneously know that you can't just show up on the stage, you also have to invest in the stage, and that's what we're doing today.
Soula Parassidis:Right, wait, let me just pause for one second, because you didn't actually give any context about who you are and what you do, so I will do it for you, since you seem to want to gloss over that. Christos is a leading researcher. He has over 80 published papers, I think academic papers, over 100 working papers. He's published 300 articles in the popular press. He has seven degrees, two of which are PhDs, from Stanford. You're also a co-founder of Living Opera. You have another startup called Dynamic, which is a fintech company. Um, you do other stuff that I can't remember right now, but that's a pretty good undergirding and foundation for the conversation we're about to have. I know that you were really trying hard to skip over that, because you're also an extremely humble person, but too bad, it's out in the world now and we're really thrilled that you are dedicating a good portion of your research agenda to the arts, because it's very rare to find an economist devoting any serious research to arts.
Christos Makridis:Well, I mean just that that thing has just annoyed me so much is how can a community so large completely leave this gem of a sector like undiscovered?
Soula Parassidis:Well, because they don't have like a really pushy offer.
Christos Makridis:Well, it's not just that you need help, help us out. But see, it's not just that. It's like we have like thousands of papers in asset pricing, so like, asset pricing is an area of finance where you put like returns as an outcome variable and you're trying to predict returns based off of like features about a firm or momentum in the market. It's like how come we have like a million papers there and we have no papers in any of the top five economics journals around arts and culture?
Soula Parassidis:Well, because you didn't come along yet. Well.
Christos Makridis:I mean, part of the thing is like, over the past 30 years there really hasn't been somebody to take up that baton, and part of what we've talked about and one of the reasons like I'm very excited about this area of research, is because there's so many questions that we just haven't answered. So number one do people value the arts? And the answer to that is yes. I mean, clearly people do, otherwise the sector would have dissolved. But how much do they value the arts? What methods do we use to value it Exactly, exactly? Number two is what sorts of strategies and mechanisms lead to better governance of an organization? So when a donor gives money, is it better to give it unrestricted or restricted? So there's governance issues related to this as well. Number three is what are the effects of museums and theaters on cities? Number four I mean what are the lives of actual artists and what facilitates greater mobility? So I mean we could spend the next 15 minutes just enumerating a corpus of potential research questions, but instead of that we'll talk about two papers.
Soula Parassidis:No, I want to hear about the two papers that we discussed and just we'll dive in Christos.
Christos Makridis:Yeah well, I mean one of the questions that's come up to us so many times when we talk to theaters and when I talk to when you're singing somewhere and I start talking to theater management and directors it's this question of the financial precarity in the arts, and so that led me to author one paper that went really smoothly. Actually, most peer-reviewed papers for the audience, most peer-reviewed papers can take five years and there's an enormous amount of idiosyncrasy in the process where the top journals will reject 99% of papers and they charge. I mean it's kind of like the audition process. Yeah, it's exactly Just a lot of the life of an academic. I'd say it's not nearly as grueling because we're able to do remote work from anywhere that has a Wi-Fi signal. But I mean you have to be in person, you have to go do an audition, et cetera, et cetera. But one of the big questions that comes up from theaters is around how are we going to make this work in the 21st century? And so one of the articles that I authored in the Journal of Arts Management, law and Society, which is a leading arts management journal, is about a sort of like a checklist of practices that a theater can implement in order to have more success, a higher probability of success when they're pitching themselves to potential donors.
Christos Makridis:And one of the frameworks in economics comes from a professor of mine that ended up winning the Nobel Prize, named Guido Imbens, and he worked with somebody named Donald Rubin back when he was at Harvard, and so they came up with something called the well, people call it the Rubin-Imbens framework, and the idea is that In the real world, we can't do experiments all the time. I mean, we can't. Very rarely can we do a full-on experiment like somebody in a lab can do. So we observe data Maybe I get a spreadsheet of data and that data is subject to many different factors, and so when you look at two variables, y and X, and maybe it's the funding of a theater and the decisions of how it casts, the people in the cast, what shows it produces, and so on you can't just say, oh well, because we cast this, it generated these revenues, right, of course.
Christos Makridis:And so then the question for an econometrician is what do you do in order to recover a causal effect, to be able to quantify return on investment? And so that's what the Rubin-Imbens framework is about is potential outcomes and what actually so, what could have happened, what actually happened, and designing statistical methods to infer causality. So in this article, I lay out a set of items that a theater could pursue in order to obtain a causal effect associated with its strategic decisions, and then also just a framework for thinking strategically about. What is our mission? What are we trying to drive towards? Who are our stakeholders? And most of the time, the biggest stakeholders for a theater are, I mean, donors that are making it possible, and then, of course, the audience.
Soula Parassidis:Right. So what are those factors then? What could they be doing differently in order to really capitalize on this framework that you're suggesting?
Christos Makridis:Yeah, I'll make a meta point and then I'll get more specifics. So the meta point is just that so many times nonprofits are challenged because they have an important mission, but things can get derailed when you only focus on mission and not on some of the operational elements. So, having a proper communications line so that meetings are set up rapidly, efficiently, people can communicate internally, that there is a feedback cycle between the person that does marketing with the person that actually interacts with the audience, with the person that interacts and does development and fundraising.
Soula Parassidis:I would argue that those things are in place, but I think you feel they could be optimized.
Christos Makridis:Yes, yes, yes. So I mean certainly most organizations have some element to that. But the question is, how do you do it more efficiently? And I mean, how do you do financial forecasting? How do you make the forecast actually undergirded in actual data? And that means drawing on historical data so that you can say, well, this happened in the past, what's likely to happen in the future.
Christos Makridis:And you don't necessarily just look at historical data for any theater. You want to find a proper comparison group. So there's a variety of techniques like propensity, score matching and econometrics that one can go into. But basically just try to find a proper control group and then you might benchmark yourself against that and then you do proper forecasting around that. The more specific point is that when you're doing causal inference and you're trying to understand the effects of a particular decision that the theater has taken on revenue and on social impact, it starts with good measurement. You need to have reliable data and so many theaters that we've interacted with, not necessarily, through any fundamental flaw of their own, they don't necessarily have a data pipeline to collect.
Soula Parassidis:Because I think you need to speak a little bit about how proper research is conducted and how extensive it is.
Christos Makridis:Yeah Well, I mean, this is a whole other conversation, but basically to do proper survey research is actually very expensive. I'll just give a couple of bullet points around this. Number one is when you have to have a large enough sample. So when we work, for example, with the Gallup organization or Ipsos, you'll have— and you're a senior advisor with Gallup.
Christos Makridis:Yeah, and I mean one of the studies that we've been doing called the Global Flourishing Study. It's 22 countries. We're longitudinally sampling the same people from each of these 22 countries. We're doing it for the next 10 years. This is a $50 million project. So I mean now I mean a theater isn't going to be doing longitudinal sampling across countries, but they might be doing within a country and that's still that can be in the millions or can at least be in the hundreds of thousands to do it really really well done.
Christos Makridis:Another factor is the questions that you're asking. Are they leading questions? Are they pushing people to a particular answer? Another big factor is omitted variables. So what we began the conversation around with potential outcomes and what actually happened.
Christos Makridis:So having the proper control variables so that, even if you don't have an exact experiment, you can what's called saturate the model where you sequentially add control variables in and you see how much the coefficient of interest changes, like casting or production or maybe it's a new marketing strategy and you see how that coefficient changes in response to the additional controls.
Christos Makridis:So there's all these different mechanisms to do survey work really well, but the core of it is good data, good measurement, and so many times we see people say oh, there's a study that says X, a study that says Y, but just because you posted something to the internet and it's like three pages, 10 pages or even 20 pages long, it doesn't necessarily count it as a rigorous academic grade study. And so part of what we've been trying to do is how do you actually conduct serious arts research that is at the caliber where it gets published but is also practically relevant and implementable, because so much research is not implementable or it just says something that's like really obvious. Like museums contribute to a local area. Well, of course they contribute, but how much? What are the major levers to take, and so on. So yeah, kind of like first main paper that we were kind of thinking about today was these best practices for theaters and any nonprofit anything in the arts and culture sector.
Soula Parassidis:I will link the papers for people to read.
Christos Makridis:Yeah, we'll provide this and we can open access. Good good, good.
Soula Parassidis:I want a second paper now.
Christos Makridis:Yeah, well, the second one goes to another thing that we've been talking about for so many years of like, how do people actually value the arts?
Soula Parassidis:Because that's the one I really wanted to get into. Yeah.
Christos Makridis:And so this is obviously, it's intangible, but the beauty of economics is that you can measure variables that are what are called latent. So there's some hidden aspect of it that maybe you can't put your finger on it exactly. But if you can put your finger on things that are adjacent to it, then you can hone in to that unobserved variable. Yeah, so I mean, what's the marginal willingness to pay for a theater, and a theater of different sizes?
Soula Parassidis:What do you mean by that?
Christos Makridis:How much would a random person on the street, would an average person or not? Take the average? Let's take the 75th percentile, the 25th percentile. How much are they willing to pay per year for theater?
Soula Parassidis:So you, mean a good income tax or some sort of social contribution.
Christos Makridis:It wouldn't necessarily have to be a social contribution, it would just be privately. This is how much I value it as so.
Soula Parassidis:When people choose to live in a particular county because they want to be close to a particular school, right that's a decision, and so they will be willing to pay a higher price for their house in order to be closer, probably something people haven't really thought about, because I don't know if people really, you know, getting your home or living near a certain landmark, I mean people will think about that, but I don't know if people necessarily think about the amenities that make a home valuable. And I would argue that arts is one of the amenities. It certainly is.
Soula Parassidis:Like New York, without Broadway would have a less.
Christos Makridis:But that's the thing is that a lot of people are thinking about this. Maybe it's not like the first thing where you're like oh, I have, this is my priority number one is being right next to name your favorite opera house, but it is a factor, and it is these amenities. And so the beauty in this area of what's called urban economics is a method called hedonic pricing, where you use information about housing values and how they change over time and you have disaggregated data, so at a county level, at a zip code level, at a census tract level, and then you use that spatial and time series heterogeneity to infer, based off of where people are deciding to live, to infer the value that they place on different amenities. The most obvious counter-argument is well, they decide to locate in that area, but just because that area is closer to a theater, has more arts and cultural organizations. It also has a lot of other things. It has higher school quality, it has better air quality, it has better restaurants, whatever it might be. And so the whole paper is basically devoted towards. Sure, I find this main result, but is it robust to control? And for other factors? So I control for the number of kind of eclectic restaurants in that county and I can measure that using the county business patterns data or the QCW, the quarterlyly Census of Employment and Wages, and the American Community Survey, et cetera, et cetera. So I kind of rule out many of these different factors and I'm able to hone in on particularly arts and cultural amenities.
Christos Makridis:A key takeaway, actually, I want to make here before making the main result, is that there's a lot that can be done. There's publicly available data, so not every arts organization needs to go and commission a study. This is an extremely important takeaway for arts organizations because so many times maybe there's consultants that are prying to say like we want, we're encouraging you to do this, and this is how much it would cost, not saying you dismiss consultants. Of course it can have a valuable purpose, but you don't necessarily need to launch some $100,000 study. Sometimes you just need a data scientist that's able to pull the right data from the QCW, the ACS, the CBP or whatever the data set is, and then to set up the right econometric experiment to be able to infer the impact that a theater has had.
Christos Makridis:So that's just one small takeaway, but the big result from this paper is basically that, yes, consumers do value arts amenities. It seems to be a couple thousand dollars per year that the average individual is actually willing to pay, which is actually quite large, and right now I'm trying to figure out. Is that too large to be plausible? But I think it is. I think it is. And then there's various types of consumers find it more valuable, so certain income brackets will find it more valuable. Differences in educational attainment are correlated with it as well. So main takeaway is that, yes, people value the arts and they're willing to pay for it, based off of the revealed preference of where they are living in the housing market.
Soula Parassidis:I mean that's very encouraging. I suppose you know we're talking theoretically. You're talking about your academic research. Yeah, I think I'm going to ask you apart from, you have a personal relationship with me and with Norman and you've gotten to know the sector. That aside, why do you value it at this point as an economist who could probably, with your background and your accomplishments, you could be sowing your time and energy into any kind of research? Why have you decided to do this and why do you value these amenities at this point in your own life?
Christos Makridis:What is it doing for you as somebody who would traditionally not necessarily be involved in this sector at all, I think there's two main reasons, and one of it comes down to the very fundamental reality that it can be extremely beautiful, sound and one of the examples that I always-.
Soula Parassidis:Why do you value that?
Christos Makridis:Well, oftentimes, as individuals, we have a bad experience with something, and then we make up our mind that we don't like this or somebody-.
Soula Parassidis:I forced you to eat liver the other day.
Christos Makridis:That's right and it was one of the best meats that I've ever had. I mean, this was absolutely exquisite. I mean, that restaurant is on fire. It's fantastic, and so we have to go there again. That's all I have to say. Really, we can end the interview now, no, but so it's a perfect example of like.
Christos Makridis:Oh, I don't think I like this type of food. Oh, I don't think I like math, and it's just because maybe you weren't exposed to it properly, and so when I was growing up, there wasn't really that much exposure to classical music, and when I did have exposure to the fine arts, it was I mean, you have to be. You have to be. I mean you have to be in the right mood, it has to be the right environment and it has to actually be good. And so when I heard your voice and Norman's voice, it was. It really is impeccable and it has a physiological response on an individual. And I don't feel that way with a lot of the, I mean things that we listen to and theaters that we've gone to, and sometimes it's just like, okay, that was interesting, I follow what's going on and it's nice, but it's not a strong impact on the soul.
Soula Parassidis:So you had a visceral response to the sound and I would say I've noticed you have those similar responses to paintings. You really love visual art as well.
Christos Makridis:Yeah.
Soula Parassidis:And you're very much into like sort of like classical style, and that leads to the second. Yeah, exactly, I didn't know it was going to lead to the second.
Christos Makridis:All right, that's right, it's a perfect segue. So number one is it does have a physiological response. And then some of the work that we've been doing, of course, is around how might audio and the operatic voice actually affect our neural pathways and like, for example, counter Alzheimer's, improve cognitive capabilities? So there's very physiological reasons that it makes sense, and then also just because it's just like absolutely beautiful. So many times we just take what is fed to us. So is it commercial on TV? Somebody watches something on Netflix. Is it necessarily good for the soul? We have to really filter that. And I mean, as we've been getting into, separate necessarily from this is diet, nutrition, what you put into your body is really important and we have to watch that, and so what we put into our soul matters even more arguably.
Soula Parassidis:Yeah, we need to be fed on all levels.
Christos Makridis:So that's number one is the impact on our psyche, our soul, our body. Number two is the effect that this has on civilization and, as we are talking about through our album, pioneering and you leading up with Echoes of Empires.
Soula Parassidis:Nice plug. I didn't ask you to do that.
Christos Makridis:I know, but it segues into number two reason, namely that understanding what led to the civilization that we live in today Right and what does lead to people coming into the dream?
Soula Parassidis:Yeah, what leads to flourishing.
Christos Makridis:Yeah, and that really is the hallmark of a lot of the research I'm doing is around what leads to human flourishing, and it's I love. I love when people say, like, what do you study? It's like I love that answer because it's so broad, it's so broad.
Soula Parassidis:Me. I study human flourishing. What do you do?
Christos Makridis:I don't mean it that way. What I love about it and yeah, what I love about it is that it's just so broad, so so many things fit into it Technology, arts, culture, labor organizations, et cetera. So that is really is reason number two is that classical music, classical education, classical studies I mean by definition it's called classical because it has stood the test of time and people still come to Athens, they still see the Parthenon, they still listen to Mozart, they still do all these things. So no one can argue that it's going away.
Soula Parassidis:There's a timelessness.
Christos Makridis:Yeah, there is a timelessness.
Soula Parassidis:We are in Athens right now.
Christos Makridis:We are in Athens, it's on our minds, it's very much in our minds and it's beautiful.
Soula Parassidis:I know that you could like just speak for six hours straight, which we're not going to do right now. I want you to speak directly to the artists who might watch this, and I want you to leave them with a word of encouragement based on your findings.
Christos Makridis:Well, I'll leave with two words of encouragement. Number one is that there are people, there are allies in other areas that are for the arts and cultural sector, and that we need to work together. So it might sound a little bit corny around collaboration, but it's also true that we do need to work together. This requires speaking different languages, because there's different norms in each of these disciplines. There's different methods. So, number one, there are allies being encouraged. Number two is that there are solutions. A lot of times we're stuck in a problem not because there's no solution, but because we haven't found it, and so trying to fill these knowledge gaps and then translate that new knowledge or that rediscovery of knowledge into practice is something that we're very passionate about at Living Opera, and so the research informs the practice.
Soula Parassidis:The reason why we care about arts Didn't Mikhail Hofstadter say that in one of our episodes.
Christos Makridis:I think you're right, so I'm not going to say it as well as him, so I'm not going to try to repeat it, but it is that same message, and so the research activities that we pursue are the intellectual foundation behind what we do in practice, whether it's the masterclasses or educational curricula and, ultimately, the singing.
Soula Parassidis:So every hour they're putting into practice and honing their skills is leading to a greater purpose.
Christos Makridis:That they're being encouraged over. Don't ever feel like you're throwing something away. It's being planted.
Soula Parassidis:I just don't feel like that.
Christos Makridis:Oh, of course, we can all feel like that.
Soula Parassidis:I mean the number of hours I don being planted. I just don't feel like that. Oh, of course, we can all feel like that. I mean the number of. I don't anymore, yeah, yeah, and I'm very, I'm just thrilled that there's even a way to quantitatively measure these things through the wonderful work you're doing. So, christos, we have to wrap it up now, and I can't forget, oh my gosh, would you like to thank we're grateful for a number of things.
Christos Makridis:Number one we're grateful to be in this beautiful hotel, Hotel de Grand Baton, and we're also grateful just to be able to record in such a beautiful location and in a historic place of Athens.
Soula Parassidis:And I have to thank Daphne Valente for this gorgeous dress and I feel very effortless and like a princess mermaid.
Christos Makridis:I just feel a little dressed down for this occasion. But it's okay, I offset it with the content.
Soula Parassidis:Christos, thank you so much for sharing and thank you for all you do for us. It's an honor. Appreciate it.
