An article in Journal of Cultural Economics, volume 32 number 1, by Kristien Werck , Bruno Heyndels  and Benny Geys.

Abstract: Governments often see it as their responsibility to support cultural life and at times spend a significant amount of resources in the pursuit of this goal. The present article analyses whether and how municipalities influence each other in this decision to spend resources on the arts (using data on local government cultural spending in 304 Flemish municipalities in 2002). Following ‘central place theory’, the focal point of the analysis is the idea that––especially for cultural expenditures––large municipalities (and, specifically, ‘central places’) may affect their neighbours’ behaviour differently than small municipalities. The empirical analysis supports this idea. Indeed, we show that Flemish municipalities’ cultural spending is generally positively affected by that in neighbouring municipalities. This pattern is, however, significantly more complex for municipalities neighbouring the 13 largest Flemish cities.

http://springerlink.com/content/30xkkg55028m2441/?p=2493a1d362474ff6a9006ad7f2ad9806&pi=2