Creative Economy: A Feasible Development Option

4Towards an evidence-based assessment of the creative economyHistorically, the cultural sphere has lacked a traditionof monitoring and evaluation, as well as the mechanisms tocarry out these activities. The allocation of resources in thisarena is seldom based on an analysis of cost-effectivenessowing to concerns about making political or cultural judgmentsas to the value of culture. Traditionally, cultural policyhas been a realm shaped by the provenance of funds, drivenby welfare-economics principles and advocacy, and seldomrequired to be evaluated in economic terms. Or, as mentionedearlier, culture was seen as a means of social development.In recent years, there has been a tendency in most countriesto consider the economic viability of cultural projectsalongside other objectives. As public funds have been largelyoutsourced, contracted out or privatized, considerable attentionhas been paid to the potential economic impact of thecreative economy. If culture is to be taken seriously within sucha framework, its demand for funds needs to be presented inthe same way as those of health or education and subject tomonitoring to attest the efficiency in their use. In the absenceof such an institutional legacy allowing for the economic valuation/cost-accountingin the field of culture, it is difficult forpractitioners and policymakers to argue the case for resources.Developing indicators in the field of culture and creativityis extremely problematic for a number of reasons.Beyond the central issue of the “valuation” of culture,another concern is the legitimation of public or privatespending on culture. A requirement is to demonstrate thatthe resources are well managed and effectively used; certainlyit is very difficult to devise a reliable metric to capture suchissues. Second, the creative industries represent new forms ofeconomic, social and cultural activity; as such they are in aconstant process of change. It is therefore difficult to deviseappropriate measures of activity, especially if the activityunder investigation is itself novel and changing.The use of new technologies and new business modelsfor the distribution of products (e.g., music) has created hugeproblems for analysts in understanding what is being sold andwhere the value lies. In such a context, old evaluation andmeasurement techniques, developed with other industrialprocesses in mind, can misapprehend activities and outputs.This problem applies to all industries, but it is particularlyacute in the creative industries. Furthermore, knowledge ofthe form and operation of the creative economy is relativelyscarce compared to that for more established industries. It isoften difficult to identify which variables are important, andit is very common that data on such variables will not havebeen collected previously.Creative-economy researchers and policymakers arethus caught in a difficult position, asserting the importanceof this activity but unable to prove or demonstrate it usingconventional means. In order to demonstrate the importanceof the creative economy and to legitimate expenditure, newdata must be collected. However, this task is costly, and statisticalbodies are not yet devoting resources to these newactivities, particularly because they cannot be certain that itwill be useful. A number of isolated studies have, in variousways, demonstrated that the creative economy exists, that it isgrowing quickly and that it generates income and jobs. Thechallenge to be faced is to develop a measure of, and an evidencebase for, the creative economy that can be deployed inall countries and situations.4.2 Towards a reliable benchmark for the creative economyThe challenge of the Creative Economy Reports is todevelop an economic indicator for measuring the contributionof the creative economy to society and to the overall economy.Clearly, this is an ambitious aspiration. First, it is fully acceptedthat economic indicators are not appropriate for capturingall creative-economy outputs and that the creative economyhas a profound impact both in other parts of the economy andmore broadly in society. Examples include the impact on individual,local and national identity, the role of the creativeeconomy in community empowerment, and the role of cultureand creativity in social mobilization. Clearly, the measures thatare developed in this analysis will be partial as well as a significantunderestimation of the true impact in other areas.Hence, the intention is to stress the importance of an initialeconomic evaluation of the creative industries in world trade,even if it is not exhaustive. The real trade values in all terms iscertainly much greater, but cannot be captured at the momentdue to the current methodological limitations.96 CREATIVE ECONOMY REPORT 2010