Creative industries

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Creative Industries (or sometimes Creative Economy) refers to a set of interlocking industry sectors, and are often cited as being a growing part of the global economy. The creative industries are often defined as those that focus on creating and exploiting intellectual property products; such as the arts, films, games or fashion designs, or providing business-to-business creative services such as advertising.

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[edit] Demarcation of the sector

The UK Government Department for Culture, Media and Sport (DCMS) define the Creative Industries as:

“those industries which have their origin in individual creativity, skill and talent and which have a potential for wealth and job creation through the generation and exploitation of intellectual property.”

The DCMS creative industries categories consists of production in the following sectors:

The DCMS list has been influential, and many other nations have formally adopted it. It has not, however, been immune from criticism. It has been argued that the division into sectors obscures a divide between lifestyle business, non-profits, and larger businesses, and between those who receive state subsidies (e.g., film) and those who do not (e.g., computer games). The inclusion of the antiques trade is often questioned, since it does not generally involve production except of reproductions and fakes. The inclusion of all computer services has also been questioned.

Some nations, such as Hong Kong, have preferred to shape their policy around a tighter focus on copyright ownership in the value chain. They adopt the WIPO's classifications, which divide the Creative Industries up according to who owns the copyrights at various stages during the production & distribution of creative content.

Others have suggested a distinction between those industries that are open to mass production and distribution (film and video; videogames; broadcasting; publishing), and those that are primarily craft-based and are meant to be consumed in a particular place and moment (visual arts; performing arts; cultural heritage).

[edit] Properties or characteristics of Creative Industries

According to Caves (2000), creative industries are characterized by 7 economic properties:

1. Nobody knows principle: Demand uncertainty exists because consumer reactions to a product are neither known beforehand, nor easily understood afterwards.

2. Art for art’s sake: Workers care about originality, technical professional skill, harmony, etc. of creative goods and are willing to settle for lower wages than offered by 'humdrum' jobs.

3. Motley crew principle: For relative complex creative products (e.g., films), the production requirs diversely skilled inputs. Each skilled input must be present and perform at some minimum level to produce a valuable outcome.

4. Infinite variety: Products are differentiated by quality and by uniqueness: each product is a distinct combination of inputs leading to infinite variety options.

5. A list/B list: Skills are vertically differentiated. Artists are ranked on their skills, originality, and proficiency in creative processes and/or products. Small differences in skills and talent may yield huge differences in (financial) success.

6. Time flies: When coordinating complex projects with diversely skilled inputs, time is of the essence.

7. Ars longa: Some creative products have durability aspects that invoke copyright protection, allowing a creator or performer to collect rents.

The properties of Caves have been critized for being too rigid (Towse, 2000). Not all creative workers are purely driven by 'art for art's sake'. The 'ars longa' property also holds for certain noncreative products (i.e., licensed products). The 'time flies' property also holds for large construction projects. Creative industries are therefore not unique, but they score generally higher on these properties relative to non-creative industries.

[edit] Difference from the 'Cultural Industries'

There is often a question mark over the boundaries between Creative Industries and the similar term of Cultural industries. Cultural Industries are best described as an adjunct-sector of the Creative Industries, including activities such as: Cultural tourism & Heritage; Museums & Libraries; Sports & Outdoor activities; through a variety of 'way of life' activities that arguably range from local pet shows to a host of hobbyist concerns. The possible difference would thus be that the Cultural Industries are more concerned about delivering other kinds of value to society than simply monetary value, such as Cultural Wealth or Social Wealth.

[edit] Difference from the 'Knowledge Industries'

Some authors, such as the American Richard Florida, argue for a wider focus on the products of knowledge workers and judge the creative class to include nearly all those offering professional knowledge-based services. At that point, the term begins to elide with Knowledge Economy and questions of Intellectual Property ownership in general.

[edit] Economic contribution

Globally, Creative Industries excluding software and general scientific Research and Development are said to have accounted for around 4% of the world's economic output in 1999, which is the last year for which comprehensive figures are currently available. Estimates of the output corresponding to scientific Research and Development suggest that an additional 4-9% might be attributable to the sector if its definition is extended to include such activities, though the figures vary significantly between different countries.

Taking the UK as an example, in the context of other sectors, the Creative Industries make a far more significant contribution to output than Hospitality or Utilities and deliver four times the output due to Agriculture, Fisheries and Forestry. In terms of employment and depending on the definition of activities included, the sector is a major employer of between 4-6% of the UK's Working Population, though this is still significantly less than employment due to traditional areas of work such as Retail and Manufacturing.

Within the Creative Industries sector and again taking the UK as an example, the three largest sub-sectors are Design, Publishing and Television/Radio. Together these account for around 75% of revenues and 50% of employment.

The complex Supply Chains in the Creative Industries sometimes make it challenging to calculate accurate figures for the Gross Value Added by each sub-sector. This is particularly the case for the service-focused sub-sectors such as Advertising, whereas it is more straightforward in product-focused sub-sectors such as Crafts. Not surprisingly, perhaps, competition in product-focused areas tends to be more intense with a tendency to drive the production end of the supply chain to become a Commodity Business.

There may be a tendency for publicly-funded Creative Industries development services to inaccurately estimate the number of creative businesses during the mapping process. There is also imprecision in nearly all tax code systems that determine a person's profession, since many creative people operate simultaneously in multiple roles and jobs. Both these factors mean that official statistics relating to the Creative Industries should be treated with caution.

[edit] Wider role

As some first world countries struggle to compete in traditional markets such as Manufacturing, many now see the Creative Industries as a key component in a new Knowledge Economy, capable perhaps of delivering urban regeneration, often through initiatives linked to exploitation of cultural heritage that leads to increased tourism. It is often argued that, in future, the ideas and imagination of countries like the United Kingdom will be their greatest asset. Indeed, UK government figures reveal that the UK's creative industries account for over a million jobs and brought in £112.5 billion to the UK economy (DCMS Creative Industries Mapping Document 2001), although the data sets underlying these figures are open to question.

[edit] References

  • The Creative Economy (BusinessWeek magazine) (2000-08-28). Retrieved on August 18, 2006.
  • Caves, Richard E. (2000). Creative Industries: Contracts between Art and Commerce. Cambridge, Mass.: Harvard University Press.
  • Towse, Ruth (2002). Book Review of Creative Industries. Journal of Political Economy, 110: 234-237.


[edit] External Links

Queensland University of Technology, Brisbane, Australia: http://www.creativeindustries.qut.edu.au/

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