Theories of entrepreneurship and management in the creative industries (6314M0212Y)
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Summary Teories of EMCI - key article take aways
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Theories of entrepreneurship and management in the creative industries (6314M0212Y)
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Universiteit Van Amsterdam (UvA)
This document contains every article's key take aways in the required literature list of the course Theories of EMCI at the University of Amsterdam. It is strucutred in tables, depicting main findings, methods, and limitations of every article.
Master Business Administration Entrepreneurship In The Creative Industries
Theories of entrepreneurship and management in the creative industries (6314M0212Y)
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Theories of EMCI – key article take aways
Week 1
Cultural industries: product-market characteristics, management challenges and industry
dynamics, Peltoniemi (2015)
Key findings Cultural industries are defined as those that produce experience goods with
considerable creative elements and aim these at the consumer market via mass
distribution. Cultural goods offer a low level of utilitarian value, and a high level
of aesthetic, symbolic, social meaning, and social display value.
- There is a consistent oversupply of creative labor.
- There is extreme uncertainty regarding the success of a product.
Innovation plays an important role in creative goods: sales are determined by a
balance between novelty and familiarity. Products usually diverse into hits and
misses. Sales result from information cascades between consumers and signals
(value) can be a sales predictor.
There are gatekeeping mechanisms in place in the market, consisting out of
upstream (labels, film studios) and downstream selectors (critics, retailers).
There is a trade-off between art for art’s sake and art for profit (market
considerations).
Creative labor can be seen as a form of cheap labor (low wages, long working
hours, high job insecurity). Success is predicted by contracts rather than talent.
CI’s are inhabited by majors and independents and the industry is usually
concentrated around a few majors. Digitalization plays an important role in new
ways of diffusion and distribution.
Methods A search engine to find literature about CI’s. narrowed the search by English
language, publishment in a journal, containing empirical work, and meaningful
acknowledgement in CI’s.
Limitations /
Pay as you go: a new proposal for museum pricing, Frey and Steiner (2010)
Key findings When considering which pricing strategy to pick, museums look for achieving
certain goals:
- Basic museum responsibilities: collecting, conserving, studying, exhibiting,
communicating.
- Economic goals: efficiency, differentiation, revenue/profit, donors,
advertisements, spillover effects, administration.
- Social goals: cultural involvement, social consideration, education, no. of
visitors, reputation/prestige, generate attention.
Museums have several choices when considering the different pricing strategies
they cat take:
- Free entry: considered social and attracts new groups to the museum, raises
no. of visitors (good for prestige). However, it is not good for efficiency and does
not allow for differentiation of customers.
- Exit donations: captures the willingness and ability to pay from customers, who
will only donate what is considered fair (depending how much they liked their
visit). More efficient than free entry, because it generates more revenue.
- Entry charge: seeks to allocate recourses as efficiently as possible, allows for
price differentiation (good when price elasticity is low). It generates additional
revenue but does not consider many social goals.
- Museum clubs: works the same as price discrimination, so good for revenues
, but still not much consideration for social goals.
→ in practice, customers reject many forms of traditional pricing systems
because of lack of information about how the prices are set, conflict over
income distribution, and the consideration of being unfair (one group will always
be marginalized by prices). The solution:
- Exit pricing: art per minute, allows for price differentiation and can be
considered social as everybody pays based on how much they like their visit. A
voluntary contribution after the visit is also possible. People might rush through
the facility but the advantages of this system outweigh that.
Methods It’s a proposition article, no methods were mentioned except for emphasizing on
pricing principles instead of actual pricing strategies when reviewing the
literature.
Limitations Proposition article, we don’t know how this will work in practice.
Contracts between art and commerce, Caves (2003)
Key findings There are two bedrock properties that distinguish CI’s from other industries:
nobody knows principle (uncertainty about success of cultural goods), and art
for art’s sake (psychological income of artist and art justification). In CI’s
creatives often need to work together with humdrum (facilitators) who respond
to basic economic incentives. This results into two sorts of contracts:
- Artist-facilitator (bilateral) deals:
Visual artist – art gallery: money is allocated based on revenues (not profits)
which results in each party trying to shift costs to the other, risk of moral hazard
for the art gallery, no vertical integration.
Author – publisher: contracts for a life-time, money is allocated based on
revenues, usually there is an advance in place that needs to be paid back, agents
serve as matchmakers and take on the costs of gatekeeping from the publishers.
Musician – record label: problem of allocation of decision rights, label has most
power (moral hazard), advance in place for artist to pay for studio time,
contracts are like this because of the “stiff-ratio”.
- Motley crew deals:
Cinema films: studio’s carry out excessive gatekeeping, they are both
bookkeepers and distributors (moral hazard), vertical differentiation, money
allocated based on revenues, money for participants trades against other
sources of utility (fame), risk is allocated on the star.
TV program series: as the series becomes a success, actors gain more bargaining
power because they become irreplaceable. This is mitigated by producers
through using long-term contracts. However, due to nobody knows many series
don’t go past the pilot phase.
Methods No methods are mentioned, it’s more like a book chapter.
Limitations /
Adding value to innovation: impressionism and the transformation of the selection system in
visual arts, Wijnberg and Gemser (2000)
Key findings Within a competitive environment, you have the selected and selectors which
make up the selection system. This can work in three different ways:
1. Market selection: consumers are selectors, producers are selected.
2. Peer selection: other producers are selectors (selected = selectors).
3. Expert selection: experts (not producers nor consumers), are electors,
producers are selected.
, Nowadays, innovation is linked to differentiation and product value, this is
because in the late 19th century, the impressionists changed the selection
system in visual arts. First the selection system was peer: other artists were
responsible which works entered the Salon, which they based on traditions and
continuity. Then, the impressionists came with their innovative works and
changed the selection system to an expert-system. They were aided in this by:
- Art museums: also began to display modern artists, certifying them (modern
art museums were born). Began to look at level of innovation in works and gave
the impressionists a stage.
- Ideological dealers: impressionists organized their own exhibitions, because
they were not allowed in the Salon. Soon, individual dealers began to exhibit
impressionists in their galleries. They wanted to spread the gospel of popular art
types = impressionism.
- Art critics: people who explained why some artworks were better than other to
the general public. Critics enforced their legitimacy by being able to spot new
movements/innovations, which made them endorse impressionists.
→ these three worked together (positive feedback loop) as catalysators for their
own legitimacy and authenticity to gain power as selectors.
This all made for the importance of innovation as means of differentiating
artistic performance. Moreover, group formation will become important in
producers and experts alike.
Methods It’s a literature/historical review paper, no methods were mentioned
Limitations /
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