In cultural-policy terms what happened in the West in the 1970s and 1980s – cuts in straight subsidy, professionalization, commercialization, diversification of markets and constituencies, deregulation as well as pluralism, etc. , albeit in a telescoped, maybe chaotic, manner. In terms of cultural industries this was associated also to the emergence of a small-business economy which was a key target of the World Bank and other development agencies (Leontief Centre, 1999). Rise of Creative Economy and Knowledge Based Economy Theory
The creative economy is reforming nearly every aspect of economic development as we know it. Knowledge and creativity have reinstated natural resources and the efficiency of physical labor as the sources of wealth formation and economic growth. In this new era, human capital, or talent, has become the key factor of production . The rise of this creative economy thoroughly alters the ways that cities and regions set up and maintain competitive advantage. The key to success in the industrial age was simple-the overall costs of doing business.
In the mass production era, regions recognized competitive advantage via natural advantages in resource endowments, transportation admittance, the cost and productivity of physical labor, and by reducing overall cost. Driven to reduce, firms selected locations that given low cost land, cheap or highly productive physical labor, and a cost-conscious business climate. Regional development strategies characteristically emphasized the use of so-called business incentives designed to win over businesses by pushing their costs even lower.
The environment and natural amenities were seen simply as sources of raw materials or as places to dispose wastes. In the creative economy, regional advantage comes to places that can rapidly mobilize the talent, resources, and capabilities requisite to turn innovations into new business ideas and commercial products. Leading regions set up competitive advantage through their capabilities. They are vehicles for mobilization that can almost instantly bring together the resources requisite to launch new businesses and turn innovations into successful products.
For these reasons, the nexus of competitive advantage shifts to those regions that can engender, retain, and attract the best talent. This is mainly true because creative workers are tremendously mobile and the allocation of talent is highly skewed. “To attract creative people (…) a place must have all three, Technology, Talent and Tolerance”. On the other hand, he does suggest a cause and effect: “… talent or creative capital is attracted to places that score high on our basic indicators of diversity”
Today, it is the capability to attract human capital or talent that forms regional advantage: Those that have the talent win those that do not lose. In this regard, the quality of place, a city or region, has reinstated access as the pivot point of competitive advantage. Quality-of-place features attractive to talented workers of an area have thus become central to regional strategies for increasing high-tech industries. For regional development strategy, this means a move from low cost to high quality-from merely attracting firms to forming the coalitions that are requisite to generate, retain, and attract talent.
For instance, the rise of the creative economy radically transforms the role of the environment and natural amenities-from a source of raw materials and a sink for waste disposal to a critical constituent of the total package required to attract talent. In doing so, it engenders economic growth. Social context in creative industries: 1. Production and consumption of culture The spread of cultural consumption and production can be global economically, as Hobsbawm maintains, ‘globalization isn’t a universal process that operates in all fields of human activity in the same way’ (2000:62).
This is so in the case of say politics, and is interceded by environmental factors such as geography, climate and history. Different cultural practices also lend themselves to transfer more easily than others: ‘Traditional culture spreads through a European model that has been taken on globally and therefore globalized: a concert program in Osaka, Chicago, or Johannesburg will present the same kind of repertoire: European classical music.
This is not true of literature because of a very influential limitation on globalization; namely language difference’ (ibid. : 122). This is obvious in the continued development of traditional opera houses, theatres and concert halls in non-European and ‘non-indigenous’ nations and the museumification of artifacts and collections in societies where this counteracts their cultural value and significance (Clifford 1988, 1990).
Popular culture is however more syncretic, and Hobsbawm draws the peculiarity between so-called high and popular culture because ‘the latter is shared by everyone, including those familiar with high culture, but the opposite is not true…. This is why the global icons come from popular culture’ (2000:123). This perhaps understates the implication of subcultures and alternative cultural capital, as opposed to the more commodified and ‘accessible’ (i. e. supply led, ‘cool’) outbursts of pop industry culture.