Summary Cultural industries NOTES for EXAM

WEEK 1
Analyzing the creative and cultural industries (CCI)

Cultural goods ARE NOT simply utilitarian goods, but require some input of human
creativity and should be attributable to an individual or group producing the group.

 A business model reveals the logic for creating and capturing value as well as
the organization's approach to renewal
 Shifts the level of analysis from organizational to individual device (in reading
2 specific case)


Modeling the cultural industries

Definition of cultural industries + difference with creative industries

DEFINITION CULTURAL INDUSTRIES = Those industries that combine the
creation, production and commercialization of contents which are intangible or
cultural in nature

CULTURAL GOODS
 Creative goods are subcategories of cultural goods
 Cultural goods require some input of human creativity in their production
o Original ideas and novel ways of interpreting the world, expressed in
text, sound and image
 Vehicles for symbolic messages to those who consume them
o Serve a larger communicative purpose (more than simply utilitarian)
 Contain, at least potentially, intellectual property (attributable to the
individual or group producing it)

DEFINITION CREATIVE INDUSTRIES = 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

CREATIVE GOODS + difference with cultural goods
 Serving more commercial purposes
 Policy implications (economic vs. cultural objectives)
 Economic analyses (supply vs demand perspectives)

6 economic approaches to analyzing the cultural industries


1. Industrial organization theory (++ relevant to those models oriented
towards the commercial production of cultural goods and services)
- Market concentration
- Barriers to entry and exit
- Degree of competition
2. Value chain analysis (used by firms to analyze performance in different
stages of the production cycle)

, - Production chain with value adding stages from initial
idea, the production of goods or services, their marketing
and distribution, until consumption




3. Inter-industry analysis (used to evaluate the economic impact of cultural
policy)
- Input-output analysis:
 Output from one industrial sector as input to
another sector (spillovers)
- Social accounting matrices
 Similar tool requiring less data for analyzing the
impact of industries
4. Locational analysis (used by governments to attract firms and develop
cultural industries clusters)
- Networks and agglomeration externalities in cultural
production lead to clustering of firms that benefit from
being located close to other firms in the same (or similar)
industries
5. Contract theory and property rights (to develop 'optimal' contracts with
value chain partners)
- Identifying property rights as a basic for contractual
arrangements that can be explained by the uniqueness of
cultural industries
 ‘Nobody knows’ (uncertainty of demand)
 ‘Art for art’s sake’ (irrational labor market)
 ‘Infinite variety’ (all product are – more or less –
differentiated)
 ‘Durability’ (ability to yield rents over a long period)
6. Trade and development (to explain specialization of countries and to
eliminate trade barriers)
- Theory of comparative advantage to explain
specialization of production in different countries
Assertion: free trade maximized world welfare

ARTICLE: AN INDIVIDUAL BUSINESS MODEL IN THE MAKING; A CHEF’S
QUEST FOR CREATIVE FREEDOM (Svejenova et al., 2010)

Business models
= “the content, structure, and governance of transactions designed so as to create
value through the exploitation of business opportunities
 Organizational device
o Reveals the logic for creating and capturing value
o Reveals the organization’s approach to renewal

,  Enhances the understanding, labeling and classification of an organization’s
operations
Shift: from organizational level --> to individual level

, Change mechanism
1. Triggers: individual's motivations and interests
2. Changes in activities, organizing, resources
3. Value captured

ARTICLE: Surviving in times of turmoil: Adaptation of the Théâtre Les Deux
Mondes business model (Poisson-de Haro & Montpetit, 2012)




When is a new business model needed?
 Address the need for potential customers -> disruptive innovation, e.g., live
stream cultural event
 Capitalize on new technology -> radical innovation, e.g., Netflix
 Bring focus where one did not exist -> from “how” we consume to “how much”
we consume
 Respond to a shifting basis of competition -> analog to digital recoding



MINILECTURE 1

Cultural industries definition:
-> those industries that combine the creation, production and commercialization of
contents which are intangible or cultural in nature (UNESCO)

Characteristics:
 Human creativity / input
 Symbolic messages transmission
 (at least potential) Intellectual property
 Cultural goods have a cultural value which transcends purely economic
valuation