While Obama and McCain debate the war in Iraq and the financial meltdown, the role of arts and culture funding has taken center stage in the current Canadian contest spurred by recent federal cuts in arts and culture spending. Others have covered what’s at stake in this debate, but let me simply weigh in with what our ongoing research at the Prosperity Institute tells about the role of arts and culture in the economy.
Our most recent research on both Canada and the United States breaks down the economy into its core occupational sectors - finance, management, technology, arts and culture, health. and education - and attempts to guage the effects of each on regional income. In both the U.S. and Canada, finance, management, and technology have a considerable direct effect on income. And both education and health - which are essential for a high-functioning society - have little if any effect on regional income. They’re necessities or public goods, but they don’t drive regional economic well-being. Arts and culture, however, are very important. In the U.S., arts and culture occupations have a significant effect on regional income, about as strong as finance and management and stronger than science technology. In Canada, arts and culture have a less direct impact on income, but a potent impact on high-technology firms, stronger in fact than the impact of science and technology occupations on those firms.
September 29th, 2008 at 10:17 am
I discovered your homepage by coincidence.
Very interesting posts and well written.
I will put your site on my blogroll.
September 29th, 2008 at 3:13 pm
I’ve been wondering lately if the Democrats wish to really challenge Republicans longitudinally that they should take a long term strategy (10-15 years?) that focuses energy on supporting/helping change policies that adhere to the work you and others are conducting. Given the current realities that seems to be creating more economic fear, which historically in the U.S. has led to increased isolationist, protectionist and xenophobic attitudes — or what one might call the negative side of “collectivism” — and a sense that Americans are generally more optimistic than other nations, and prefer to hear optimistic rhetoric from their leaders, I wonder if the Democrats could capitalize on your research to help their own interests, which could lead to increased change in demographics in states they typically lose on election day.
Colorado is almost a model of this now, as Obama is ahead in the polls. Given the high proportion of Democrats living in so few states, and many of the smaller populated states away from the coasts being more “red,” if more of these other states become attractive to creative class-types, one might suspect that they could win some more states that have traditionally been tough to win, or out of reach.
I ask this due to what seems like an inability to win the game of “culture wars,” that the GNP has played since 1980. It even seems to have shown itself in your piece about Hillary Clinton’s popularity with folks who may be more “fearful” of globalization and current economic/demographic changes (righteously so, I believe, in terms of how little we do as a nation to help provide guidance for people to pursue creative oriented work and live off of it) versus the more likely to be educated/creative class-types and “hopeful” Obama supporters earlier in the year.
I am curious if there are any strategists in the party who have thought of this or are working on such a plan. Of course, this may hurt your own research, by adding to some folk’s view of it as polarizing, but that doesn’t necessarily make it invalid or worthwhile either.
September 29th, 2008 at 4:01 pm
The results you are reporting may be more correlation than causation. That is, areas with strong economies or large high-tech sectors may be better able to support the arts. Thus, the presence of a thriving arts sector is associated with a dynamic economy, but may not be a contributor to that dynamism.
September 29th, 2008 at 6:18 pm
Peter - Maybe. But then we would have to say the association with business, finance and management occupations is also correlation. Arts, culture and entertainment occupations are significant economic generators. Entertainment is a significant sector of the US, Canadian and global economies. One last thing: design is increasingly becoming a key sales feature in many products, especially tech products. And increasingly we see a melding of technology and entertainment in products from animated movies to ipods and video games. So it seems to me that anyway it’s sliced when we look at arts, culture and entertainment broadly, their effects are significant. By the way, the results I am reporting are for statistical techniques known as path analysis, which attempts as best one can to isolate the effects of separate variables. My team and I are pretty confident in these results. RF
September 30th, 2008 at 2:19 am
In the UK, most major museums and galleries are free to enter (apart from touring exhibitions), and the government is proposing to make one day a week at theatres free for those under 26.
It would be interesting to compare the impact on growth before and after this legislation to see if it has any economic effects (not that that’s the be all and end all of the policy).
September 30th, 2008 at 10:47 am
Richard, I think your recent and past work emphasizing the increasing importance of the role of arts and culture in developed economies is spot on and rather groundbreaking. These sectors of the economy should no longer be written off as simply an outgrowth of some other “real” industry, as they are ever becoming a more important export sector in their own right.
However, I am not sure that we can just disconnect them from technical change and/or knowledge production and view them as something different. I mean, I don’t have any data to support the following, but I presume that the export oriented (or the “basic” regional economic) piece of the arts and culture sector is primarily in movies, cd’s/digit music, fashion, and large scale theater productions. These things, unlike their painting, sculpture, and local music scene counterparts seem to have historic ties to technological advances (such as the advent of motion picture technology or sound in motion pictures, or petro-chemicals (in fashion), or the invention of television and radio as just a few examples) and so maybe the arts and culture industry should be viewed as an industry that is not really very unique. Thus, maybe the U.S. advantage (or more generally, the developed world advantage) in the development and location of this industry is simply a result of a “first mover” advantage in the underlying technologies behind them.
Do you think we can really call the increasing importance of the art and culture industry in the developed world a paradigm shift in terms of economic structures (and I am not sure that you are)? Perhaps its current importance is just a reflection of the historic technical advantages in these industries that emerged in the developed world. Maybe arts and culture, like all other industries, is still fundementally driven by knowledge production.
In a similar vein, we can see that this industry is beginning to diffuse to other locations around the world, such as India among many others, along the same lines as past industries have, once the underlying technologies enabling them has begun to be codified.
October 1st, 2008 at 5:10 am
[...] Creative Class: Arts, Culture, and Economic Growth - Creative Class arts and culture add a lot to regional income,so that abolishing its subsides does not make sense [...]