CULTURE IS ECONOMY – OR MAYBE NOT? (TAKE 2)

Lausanne

by Ares Kalandides

The other day, following an “unfortunate” speech by the Greek minister of Culture and Sports, I offered some thoughts on culture and the creative economy (here on this blog). Only the day after, on Sunday 23rd February 2014, the newly designated Italian minster of Culture and Tourism, Dario Franceschini, stressed the economic dimension of the future Italian cultural policy, in an interview for the Italian newspaper Il sole 24 ore. I think there is a need to elaborate more on my initial thoughts on culture, economy and the creative industries, and try to clarify what I think are profound misconceptions.

1. If as economy we understand the socially constructed system of production, exchange and consumption of goods and services, then yes, culture, and in particular cultural production, is directly connected to it.  There are goods and services that need to be purchased in order to be turned into any kind of cultural output, there are people who make a living from culture and people also partly willing (and able) to pay for it. As market on the other hand, I understand the system of exchange of goods and service.

2. This does not mean that culture is economy. There are very important elements in culture that go beyond the economic production, exchange and consumption of goods and services, in particular those that have to do with personal fulfilment, social collaboration, conflict and cohesion, reflection and expression, dialogue and communication – just to name a few.

3. In most states around the world culture is organized as a system that includes both market and non-market elements. The role of the state can either be to keep parts of the cultural value chain completely out of the market (e.g. national museums) or to regulate others (e.g. fixed book prices in some countries) inside the market. Exactly what remains out of the market and what is regulated, is always a question of negotiation and political choices.

4. This double nature of cultural production (economic/non-economic) makes if very difficult to define the value it creates. On the one hand its economic value can be defined through its market value, which will fluctuate constantly, depending on a vast array of factors such as marketing, consumer taste and choices, gatekeepers etc.  On the other hand, its non-economic value will always be a matter of contention among those involved in it. The fact that its non-economic value cannot be quantified (per definition) becomes a huge disadvantage when it comes to drawing cultural policy. Policy-makers are increasingly incapable of thinking beyond numbers.

5. In an attempt to look more closely into the economic dimension of culture inside the political context of 1990s New Labour in the UK, the concept of the creative industries was developed. This was mostly about businesses (thus “creative industries”) in creative production, which was defined in a much broader sense than culture. It included the market-side of cultural production (book market, art market etc.), but also other related copyright-based branches such as design, advertising, software development, media etc.

6. The relationship between market and non-market elements, culture and the creative industries can be well illustrated in some value chains such as in the case of a museum: A state museum in general does not operate inside the market and, in my opinion, it could only be marginally considered as part of the economy (there is a labour and a consumption side to it). Yet, a museum (or the state) commissions private builders (i.e. who operate in the market) to do restructuring work in the building; it will probably outsource a café or even other services. The museum shop can be considered a creative business as it a) sells cultural goods and b) operates in the market. Its biggest asset of course is the museum (outside the market) and its main value, which can be traded in the market, is a symbolic one and derives from it. Without the museum (not as location but as symbol or brand) the shop hardly has any value.

6. Beside the case of the museum, culture produces economic value at different levels. Because of my own work, I am particularly interested in what that means for places: Culture contributes to an ideal value increase, a positive influence on a place’s reputation and image, which can be monetized or not. It is mostly the tourism economy that profits from this reputation and that explains why Italy, for example, has created a common ministry for Culture and Tourism. The underlying risk though, is that states only support that culture that can be sold to tourists, thus reducing it again to its market dimension. Touristification of culture is a serious threat in many countries with a developed tourist sector.

Researching the role that culture can play in the economy is interesting, both as an intellectual exercise and as a means of designing public policy. Reducing culture to economy, nonetheless, is a politically dangerous undertaking, that is directly linked to the “marketization” of everything around us. If we do not want to diminish the human to a “homo economicus”, we need to resist this reductionist view of the world, with whatever means we possess.

About Ares

Ares Kalandides holds a PhD in Urban and Regional Studies from the National Technical University of Athens. He is the founder and CEO of Inpolis, an international consultancy based in Berlin, Germany and has implement several projects around the world. Ares teaches Urban Economics at the Technical University in Berlin and Metropolitan Studies at NYU Berlin.
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One Response to CULTURE IS ECONOMY – OR MAYBE NOT? (TAKE 2)

  1. ergamenis says:

    Great job Ares!

    I am specializing in Nubian Studies, having lived and worked as an archaeologist in Sudan.
    In that country, archaeology, museology, and culture more generally, face very acutely the problems you describe.
    Needless to say that the National (Sudanese) Corporation for Antiquities and Museums is also subordinate to a Ministry of Tourism, Antiquities and Wildlife on the national level and to a Ministry of Culture and Information (where tourism is the unnamed third field of responsibility) on the level of the Khartoum prefecture…

    Thanks for the things you write and share with us!

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