Creative Economy: A Feasible Development Option

4.9 Methodological basis for a unified measureof international trade of creative goodsAgainst this background, chapter 5 presents in detailthe information that can be collated on the trade of creativegoods and services. It is important to caution end-users ofthis data that they do not provide a final figure on the valueof global trade in creative industries goods due to the reasonselaborated above. Nevertheless, they give a good indicationof the overall trends, the order of magnitude of the trade increative goods and services and major trade flows.Our approach was to use caution and err on the side ofunder-definition and exclusion rather than over-inclusion ofvariables. The analysis does not estimate the value of categoriesthat are a mixture of creative and non-creative goods. In fact,where there is uncertainty about the robustness of a categoryin reporting only creative industries, it is omitted. It is necessaryto proceed on the basis of verifiable facts (not estimates)obtained from official available national sources that are basedon a sound methodology and figures that are reported to theUnited Nations by national sources. Therefore, the findings ofthis report are at the lower end of valuations; without doubt,the actual figures will be considerably higher.In principle, the methodology deployed is simple andadditive. Trade statistics were broken down in their classificationto the smallest unit of analysis (usually referred to usingfour- or five-digit codes); then such units are included orexcluded from a definitive list of creative industries. Clearly,some activities associated with creative production are notclassified or described in data sources or they are describedbut carried out informally and have not actually been capturedin any data collected. These data will continue to beinvisible and go uncounted in the present schema.Recognizing that intellectual property is often animportant element of creative products, an attempt is madeto find corresponding data. However, the only available dataare on overall royalties, and they are collected using a differenttaxonomy. Ideally, some way of relating these data couldbe developed as the coverage of the work of WIPO increases.In addition, specific data on copyrights for the creativeindustries are not available. As a consequence, data on intellectualproperty data and on physical trade are not simplyadditive; it is certain that most intellectual property transactionshave been missed owing to non-availability of data.Copyright data depend on a locally functioning system forthe regulation, collection and distribution of IPRs. However,this system is not complete in the developed world and ispartial at best in many areas of the developing world. Hence,the developing world is likely to be under-represented inthese data. 25Trade information is fundamentally measured throughthe physical auditing of imports and exports of goods acrossnational borders. These goods are measured either by weight,volume or value. The reporting of the services sector iscarried out on a different basis. The most detailed data arecollected with respect to financial, trade-related foreignexchange flows self-reported by central banks (but not disaggregatedby product). Knowledge of the trade in services ingeneral and creative goods in particular provides evidencethat these figures tell only a little of what is needed to informpolicy-oriented analysis. For example, the weight or numberof CDs traded is an inferior indicator for policymakingbecause it does not inform the value of intellectual propertyassociated with what is basically a small disc of plastic.Moreover, it is possible that one recording of a song couldbe exported (in a passenger’s suitcase) and then reproducedin a second country under local licence or distributed as anMP3 file. No financial flows returning to the country oforigin are either recorded or visible. Thus, the value of musicto international trade is difficult to ascertain. For someproducts, the transfer of mass, volume and value can act as aproxy for value, but for most, it does not. Hence it is preciselybecause creative goods are worth more than their functionalvalue that the anomaly is so serious. For example, how can twopieces of furniture — chairs, for instance — be fully accountedfor when both contain similar volumes of material and aretherefore the same weight of goods, but one is an exclusive“designer” chair which has considerable aesthetic and retailvalue, and the other is a mass-produced office chair?The fundamental taxonomy of trade statistics is basedon the type of materials used. This presents those interested4Towards an evidence-based assessment of the creative economy25For example, the International Federation of the Phonographic Industry, an international trade body for music companies (http://www.ifpi.org), does not collect data in many countries,as reliable data are not available.CREATIVE ECONOMY REPORT 2010117