Effects of Renewal Investments in Immovable Cultural Heritage on Slovenian Public Finances: Convergence with Selected EU Countries

Abstract

In our paper we provide a measure of the optimal state
incentive needed for the purpose of regular investment in
maintaining immovable cultural heritage. Slovenia annually
needs 32.7 million euros of investment for the maintenance
of its immovable cultural heritage, which is feasible with 16.4
million euros of state subsidies. Comparing the mechanisms
of selected EU countries, we show convergence occurrences
using an indirect approach. Investments in cultural heritage
represent an increase in one of the components of final
demand with a positive impact on the economy. This was
assessed with Leontief's production function (effect via
reproduction chain). Investments in the maintenance of
immovable cultural heritage also have a positive impact on
tourism revenue. According to the results of the input-output
analysis, regular maintenance annually results in 60.9
million euros' value added with 22.4 million euros higher
general government revenue. The net fiscal effect of
incentives for these investments is positive for 36.5% of
public funds spent.