EDR and the Creative Community

Creative Economy

Developing, supporting and nurturing the creative economy is increasingly a key economic development strategy. As the economy continues its transition from industrial to knowledge, integrating strategies and implementation efforts that embrace the creative industries becomes more and more important.

What is the creative economy? It is the term used for economic activities that leverage and generate knowledge and information through creativity and innovation. Creative economy sectors are varied and diverse, but their unifying characteristics are creativity, innovation and information. Sectors include design, film, software, visual and performing art advertising, fashion, broadcasting and architecture.

How important is the creative economy? Because definitions vary and supply chains are complex, academics, scholars and statisticians don’t agree on what should be included or excluded and what should be measured. And there has been some heated debate about whether the creative economy can be a driver of economic success or is an overblown concept.

EDR comes down on the side that believes the creative economy will be increasingly important in a knowledge-driven world. Not only can it boost jobs and opportunities, but it can play an important role in turning around neighborhoods and commercial corridors. But as nuts and bolts implementers, EDR knows programs and projects in one city may not work well in another – and a one-size-fits-all approach is bound to fail. And jurisdictions ignoring core industries – manufacturing, agriculture, energy, transportation – to embrace the creative economy do so at their peril.

EDR team members were early proponents and successful implementers of creative economy projects, programs and initiatives.

  • In the early 1990s, EDR team members identified the increasing confluence of art, technology and commerce and conceived, developed and managed the signature Business Technology Center as a key project for technology and creative economy development in the San Gabriel Valley.
  • Ventura’s WAV project represents a brick and mortar investment in the creative economy. Conceived, development and managed by EDR team members, the WAV project represents the integration of housing and economic development to nurture and support creative endeavors.
  • EDR team members were instrumental in creating an emphasis on the creative economy in Long Beach, helped manage the revision of the City’s Cultural Master Plan, and drafted a comprehensive analysis on financing creative economy initiatives to boost the City’s overall economic prosperity.

Creative Sectors – What Are They

There is some disagreement among economists, policy advocates and practitioners as to the actual sectors in the creative economy. Some sectors are considered mass-produced (Film, Broadcasting) and some are considered individual (Art, Crafts), but the following are typically considered part of the mix:

  • Advertising
  • Architecture
  • Arts – visual and performing, including music
  • Crafts
  • Cultural – museums, performing arts centers
  • Design – including graphic and industrial
  • Designer Fashion
  • Film – including video and photography
  • Software – including applications, programs and computer games
  • Publishing – including hardcopy and electronic
  • Broadcasting – including television, Internet and radio

Characteristics of Creative Sectors

Richard Caves developed a list of characteristic that cuts across various creative sectors. (Caves, Richard E. (2000), Creative Industries: Contracts between Art and Commerce, Harvard University Press).

Nobody knows principle: Demand uncertainty exists because the consumers’ reaction to a product are neither known beforehand, nor easily understood afterward.

Art for art’s sake: Workers care about originality, technical professional skill, harmony, etc. of creative goods and are willing to settle for lower wages than offered by ‘humdrum’ jobs.

Motley crew principle: For relatively complex creative products (e.g., films), the production requires diversely skilled inputs. Each skilled input must be present and perform at some minimum level to produce a valuable outcome.

Infinite variety: Products are differentiated by quality and uniqueness; each product is a distinct combination of inputs leading to infinite variety options (e.g., works of creative writing, whether poetry, novel, screenplays or otherwise).

A list/B list: Skills are vertically differentiated. Artists are ranked on their skills, originality, and proficiency in creative processes and/or products. Small differences in skills and talent may yield huge differences in (financial) success.

Time flies: When coordinating complex projects with diversely skilled inputs, time is of the essence.

Ars longa: Some creative products have durability aspects that invoke copyright protection, allowing a creator or performer to collect rents.

Intellectual Food Fight!

Two heavyweight economic thinkers have been sniping at each other about the value of the creative economy, and for those who enjoy an intellectual food fight it’s been a feast.

In one corner we have Richard Florida, author of The Rise of the Creative Class, and one of the most widely known proponents of the importance of the creative economy. Florida employs a wider focus than other urbanists, as he identifies knowledge workers in many sectors as constituting the creative class. Further, he believes that cities and regions that attract these knowledge workers will enjoy greater future prosperity, as knowledge workers are the key input for creative production. Florida points to the economic success of Seattle and San Francisco as examples of the creative class at work – and postulates that diversity and multiculturism are key components to attracting and growing the creative class. For more Florida, see creativeclass.com.

In the other corner we have Joel Kotkin, author of The City, A Global History, and a well-known commentator on urban life in Los Angeles. Kotkin believes Florida vastly overstates the value of the creative class, and thinks that economic strength still relies on traditional industries, such as energy, agriculture and manufacturing. Kotkin believes cities and regions adopt creative class strategies at their peril, points out the wealth disconnect that can occur between knowledge workers and service workers. He acknowledges some creative economy success in selected cities – although thinks the record is mixed – and points out regions where creative class strategies have not taken hold despite well-publicized efforts. For more Kotkin, see joelkotkin.com.