Is Creation an Industry? A Constructive Critique of the Economics of the Cultural and Creative Industries

Freeman, Alan (2004): Is Creation an Industry? A Constructive Critique of the Economics of the Cultural and Creative Industries.

Abstract

This paper is a mirror of the same paper published by SSRN, lodged with MPRA for completeness and for the historical record. It should be cited as: 'Freeman, Alan, Is Creation an Industry? A Constructive Critique of the Economics of the Cultural and Creative Industries (June 3, 2012). Available at SSRN: http://ssrn.com/abstract=2074338 or http://dx.doi.org/10.2139/ssrn.2074338'

It is the earliest version of this paper and the most complete, illustrating the original thinking which went into the two subsequent revisions. These are lodged with RePec as

(1) 'Culture, Creativity and Innovation in the Internet Age' ( http://mpra.ub.uni-muenchen.de/9007/) which was presented to a conference in IPR at Birkbeck University on May 23, 2008

(2) 'Creativity in the Age of the Internet' (http://mpra.ub.uni-muenchen.de/14903/) which was presented to a seminar held at the Science Policy Research Unit (SPRU) of Sussex University on October 31st 2008

It was originally prepared for a special issue of the Journal of Management Philosophy, but was rejected. It was submitted to the Creative Industries Journal, but never arrived in print.

The paper offers a suggested framework for formulating economic policy for the cultural and creative industries. It argues that both the cultural and (recently-defined) creative industries are not a recent phenomenon but historically central to the development of the modern industrial economy.

It shows that, in terms of conventional economic theory, these industries are a 'proper economic sector': they have a distinctive resource, production process, and output. There are therefore sound theoretical reasons to explain their present dynamism, notably the productivity revolution brought about by remote and multiple service delivery (internet, telecomms, broadcast etc).

It defines this distinctive resource, process and output. The 'product' is culturally differentiated goods and services. They are therefore central to the reproduction of culture and hence have to be the object of policy whether or not there is market failure, because culture is a legitimate area of social and political concern.

The production process is 'flexible production of short life cycle goods to an abstract or imperfect specification' which reverses the paradigm of Fordism. Cities, particularly global cities, have become the decisive location for this new form of industrial organization and special attention has to be given to the the city’s cultural and creative infrastructure.

The primary resource is creative human labour. This is a necessary resource and special attention has to be paid (in policy) to catering for it and creating the infrastructure it needs to function.

• Item Type: MPRA Paper
• Language: English
• Keywords: cultural economics; creative industries; innovation; internet
• Subjects: Z - Other Special Topics > Z1 - Cultural Economics ; Economic Sociology ; Economic Anthropology; O - Economic Development, Innovation, Technological Change, and Growth > O3 - Innovation ; Research and Development ; Technological Change ; Intellectual Property Rights; J - Labor and Demographic Economics > J2 - Demand and Supply of Labor

References

Adorno, T and Horkheimer (1947) The Dialectics of Enlightenment. London: Verso

Anderson, B.(2007) Imagined Communities. London: Verso

Archibugi, D (2002) ‘Pavitt's Taxonomy Sixteen Years On: A Review Article’, Economics of Innovation and New Technologies, vol. 10, no. 5, 2001, pp. 415-425.

Bakhshi, H, Eric McVittie and James Simmie (2008) Creating Innovation:Do the creative industries support innovation in the wider economy? London: NESTA. http://www.nesta.org.uk/library/documents/Report%20-%20Creative%20Innovation%20v5.pdf

Bourdieu, P. (1979) Sur la Distinction. Paris: Minuit

Braudel, F (1979) Civilisation Materielle, Économie et Capitalisme : XVe – XVIIIe Siécle. Tome I : Les Structures du Quotidien. Paris: Armand Colin

Bureau of the Census (1993a). Economic Classification Policy Committee: Issues Paper No. 5: The Impact of Classification Revisions on Time Series. http://www.census.gov/epcd/naics/issues5 accessed 23/9/2007

Carey, J. (2006) What Good are the Arts? Oxford: OUP

Caves, R. (2000) Creative Industries: Contracts between Art and Commerce. Harvard: HUP,

Chekhov, A (1918) Poprygunya (Grasshopper). English language version available at http://www.eldritchpress.org/ac/grasshopper.htm

DCMS (2007) Interim results of the Creative Economy Programme http://www.cep.culture.gov.uk/index.cfm?fuseaction=main.viewBlogEntry&intMTEntryID=3104 accessed 1/10/ 2007

Desai, R. (2008) forthcoming. Review of Anderson

Elias, N (1997) Über den Prozess der Zivilisation. Berlin: Suhrkamp.

Florida, R (2002). The Rise of the Creative Class. New York: Basic Books

Freeman, A. , A. Kliman and J.Wells (2004) The New Value Controversy in Economics. Aldershot: Edward Elgar.

Freeman, Kliman and Wells

Freud, S. (2004) ‘The Future of an Illusion’ in Mass Psychology and Other Writings. London: Penguin

Garnham, N. (1990) Capitalism and Communication: Global Culture and the Economics of Information. London:Sage

GLA (2002) Creativity: London’s Core Business. London: GLA

GLA (2004) London’s Creative Sector: 2004 Update. London: GLA

GLA (2007) Creative Industries: 2007 Update. London:GLA

Harvey, D. (1989) The Condition of Postmodernity: an enquiry into the Origins of Cultural Change. Oxford and New Malden, Mass.: Blackwell.

Held, D. and A. McGrew (2000) The Global Transformations Reader. Cambridge: Polity.

Hutton, W., Á. O’Keeffe, P. Schneider, R. Andari and H. Bakhshi (2007) Staying ahead: the economic performance of the UK’s creative industries. London:NESTA

Hesmondhalgh (2007) The Cultural Industries. London: Sage

Howkins, J. (2001) The Creative Economy. London: Penguin

Jefferies, C. (2008) ‘Monetary Theory and Monetary Policy in Castile during the first half of the 17th Century’ in Blanc, J. and Ludovic Desmedt (editors), L. Idées et pratiques monétaires en Europe, 1517-1776, Geneve: Droz, 2012

Kippen, C. (2004) The History of Footwear, http://podiatry.curtin.edu.au/sump.html , accessed 1/10/2007

Library of Congress Business Services Division (2007) Business Reference Services, issue #9, fall 2007. http://www.loc.gov/rr/business/BERA/issue9/codes.html , accessed 1/10/2007

McLuhan, M (1966) Understanding Media: the Extensions of Man. New York: McGraw Hill

McVittie, E.P. (2007) How linked are the UK’s creative industries to the wider economy?: An input-output

Analysis. NESTA working paper.

OECD (1996) The Knowledge-based Economy, Paris: OECD http://www.oecd.org/dataoecd/51/8/1913021.pdf , accessed 1/10/2007

ONS (2003) UK Standard Industrial Classification of Economic Activities 2003. London: The Stationery Office. http://www.statistics.gov.uk/methods_quality/sic/downloads/UK_SIC_Vol1(2003).pdf , accessed 24/9/2007

Perez, C (2003) Technological Revolutions and Financial Capital: The Dynamics of Bubbles and Golden Ages. Aldershot: Elgar

Porter, M (1998) The Competitive Advantage of Nations. New York: The Free Press

Pratt, A, 2001b Routledge encyclopaedia of international political economy, Routledge, London: Ed. R.J. Barry-Jones. Entries :Local economic development, Sectoral planning, Cultural industries, and the Technical Division of Labour

Selwood, S (ed), 2001, The UK Cultural Sector: Profile and Policy Issues. Policy Studies Institute, London.