The Difference between Culture Industry and Creative Industry

Introduction

The culture industry and creative industry have both been frequently mentioned in the last few years, sometimes separately and at other times interchangeably. Communities have always been proud of their cultures. The advent of technology and innovation has been combined with the culture and thus there is promotion of culture but with some economic gain which has contributed to employment and economic growth, thus providing a holistic approach towards the integration of culture, technology and economics. Creative industries add the concept of creativity in the integration of culture, economics and technology.

Though the concept of creative industries is still very new, the industry has experienced substantial growth in the last few years. Creative industries generated an estimated income of US$424 billion in 2005 (Basu, 2005). The industry has provided job opportunities to millions of people all over the world, employing more than 6 million (Kunzmann, 2007). This paper will analyze the difference between the culture industries and the creative industries and the impact of economization of culture on conditions of labor in the creative industry. Creative industry includes a variety of industries with the advertising industry being one of them. This paper will use the advertising industry as an example in analyzing the impact of economization of culture on labor in the creative industry.

Difference between the Culture Industries and the Creative Industries

Culture Industry

Cultural industries are those economic activities that produce tangible or intangible artistic and creative products and which can be exploited to generate wealth through exploitation of cultural assets. UNESCO defines cultural industries as those goods and services that “combine creation, production and commercialization of contents which are intangible and cultural in nature”. These industries use creativity, cultural knowledge and intellectual property to produce products and services with social and cultural meaning (UNESCO, 2010). The one distinct feature in cultural goods and services is that they encourage culture by promoting and maintaining cultural diversity and enhance democracy in accessing culture.

Each society has its own culture which is expressed in the people’s values and identities’. Recently this culture has been amalgamated with creativity and economics and thus coming up with creative economy. Creative economy combines economics, culture and modern technology. This concept should be used in forming strategies that are results oriented in the developing countries. According to O’Connor, the culture industry became more meaningful after integrating with the modern systems of monopoly capitalism. Before this, culture had been considered as just a status symbol, or as a form of decoration.

Views changed and culture was being considered as an economic resource worth of attention from the policymakers. It was seen as a potential tool for economic development and employment creation and one which could be used for tourism purposes as well as creating an image for the community. Cultural industries are characterized by some of these features (Kunzmann, 2007); they are small firms with low or average wage rates. In most cases the providers are self employed and they experience high levels of job satisfaction. They have flexible working hours and a low degree of unionization. The providers get their customers through high network integration and hence a high consumer dependency.

Creative Industry

Different regions have different meanings and classifications of creative industries. These meanings have been structured and classified to form four models, the UK DCMS model, Symbolic text model concentric circles model and WIPO copyright model. Creative industries are economic activities that are based on an individual’s skills and talent whereby the talent is exploited and generated to create wealth and to develop intellectual property. The basic inputs in these industries are creativity and intellectual capital, while the end products are tangible goods and intangible intellectual property or artistic services.

These end products have original creativity, economic value and an objective to meet the market demand. Creativity includes coming up with original, imaginative, ideas in art, cultural products and scientific creations, and coming up with end products that are inspiring and inventive. Creative industries form a creative economy, (United Nations, 2008). According to the United Nations Conference on Trade and Development (UNCTAD) creative industries are divided into four groups, the arts, heritage, media and functional creations.

Creative economy helps in creating jobs and promoting exports, cultural diversity, and thus contributes to the growth of the economy. It allows for the amalgamation of economics, cultural and creativity which is combined with technology, intellectual property and tourism objectives to result to a creative economy. It has a macro and micro effect on the economy. The market structure is diverse and can be artistic individuals, small scale businesses and even big multinational companies. The creative businesses experienced an 8.7 percent growth rate between 2000 and 2005. In 2005 the goods and services contributed to 3.4 percent of the world f with gross earnings of $424.4 billion. In 2003 the industry employed 5.6 million people in the European Union countries.

Creativity is used in the interaction of the other four forms of capital, social capital, cultural capital human capital and structural or institutional capital leading to what is now known as the 5cs. The industry is being regulated under the Intellectual Property Rights, i.e. copyrights, patents or trade. The problem with the IP is the fact that they favor advanced countries and the developing countries have to agree to these terms.

Difference between Creative Industry and Culture Industry

The difference between creative industries and cultural industries is distinct and at times the two have been used interchangeably. Creative industries are centered on cultural industries, but not restricted to them. The one way to differentiate cultural product and services is that they may have a cultural characteristic that is not measurable by monetary terms. There is a value attached to the products or services both by the producer and the consumer. This value maybe that the product being used as a source of identity for the specific community. The difference ca also be found in that when producing cultural products, it requires, a human activity input, they are symbolic and they are used in passing a message, and there is potential for intellectual property that is unique to whoever is producing it, be it be an individual or the group.

Since there is creativity in the cultural goods and products, it can be said that they are a subset of creative goods and services and yet taking into consideration that creative goods and services cover a wider range of products. Creative goods do not have a unique cultural value in them. When used distinctively, creative products and services are only meant for commercial purposes, but they need creativity to be produced. This may include fashion designs and software creation.

In contrast to culture industries, creative industries are mainly big or middle size companies. They pay high salaries especially to their senior staff. The organizations in the creative industries have fixed official working hours for their employees.

Examples of cultural products include artwork, musical performances, literature, film, television and video game (Kunzman, 2007). On the other hand, the creative industries include the arts, media (film, tv, and radio), music, advertising and publishing, architecture and design, software development and digital media design.

The Impact of the Economization of Culture on Conditions of Labor in the Creative Industries, (Advertising Industry)

Economization of Culture

Economization of culture refers to making the best of culture to achieve the best effects economically or otherwise. The culture of economics is the analysis of the cultural sector, and involves assessment and organization of the cultural industries, both creative and performance heritage, whether they are publicly of privately owned. In this aspect, culture is seen as a production or a commodity for consumption by the public, who are taken as the consumers. Economization of culture results from the increase in the volume of capital from cultural products through the markets. In turn there is marketization of culture (Mestrovic, 2004). It means letting culture content is to influence the commodity production. The culture gets financial support as this financial support is justified by the economic gains it will bring back to the society. Culture economics involves the interaction of creativity, cultural policies with technological and trade policies.

Creativity refers to formulation of new ides which are applied together to create an original work of art and cultural products, functional creations, scientific inventions. Creativity has an economic aspect to it as it involves generation and exploitation of this creativity and generates economic benefits to the creative entrepreneur. This creativity leads to innovation which boosts productivity levels leading to an increase in economic growth and job creation.

Creative economy has evolved from recognizing that there is a way that culture and economy can be merged and that both can be utilized for development purposes. As a result of the countries that use creativity in their culture for economic purposes also help in preserving their own culture, informing others about their cultures as well as earning from this culture. Thus it helps in cultural diversity, promoting social inclusion as well as enhancing human development. It leads to creative class, creative entrepreneurs, creative cities, creative clusters, networks and creative districts. Creative economies drive the economy through technology through multimedia and telecommunication, demand for the creative products and fueling of growth in tourism. The creative economies also drive the economy by creating innovative ideas that help in organizations remaining competitive (Hartley,2005).

It is the responsibility of each country to set its own policies in regard to the promotion of creative economies. However the UNCTAD has a mandate to assist governments in formulating their policies and especially for developing countries.

One of the creative industries is the advertising industry. The advertising industry includes production of advertising materials, PR campaigns, creation of advertisements and promotions, consumer research and insights, media planning, buying and evaluation and management of client marketing activity and communication plans. Advertising has been affected positively by the development of creative economy. Advertisements will be directed to potential customers and to attract the customers, advertisers have to be creative and at the same time respecting the culture of the people. Creative economy has therefore have had a big impact on advertising where creativity, culture and the economy are merged and used effectively through creative advertisement through the media, publishing and over the internet. In addition to this, creative industries are expected to continue to grow and thus create employment. This will be created by the increasing demand for cultural products and services (European Commission, 2010).

The creative industries have contributed to the growth in employment and especially since the industry is labor intensive. There is however some difficult in measuring the effect of advertising on the labor sector brought about by the differing definitions and categorization of creative industry. The industry employs copywriters, those who create drawings, photographers, painters and market researchers. There are more jobs to choose from and in some cases, there is flexibility in the working hours making them more dynamic. In the US the industry had employed about 416,300 people in August 2009, after facing a decline resulting from the global financial crisis.

The industry had employed 478,600 in October 2007. In the US the industry’s wages make almost 44 percent of the nation’s total revenues (Kirchhoff, 2009). The advertising industry has a major impact on the labor markets. In the UK, the advertising industry generated an income of £15.988billion net of VAT IN 1998 while the rest of the creative sector reported £13 billion. In the 2000, the sector employed 92,800 people (Svob-Dokic, 2005). In the US the industry accounts for 2% of the country’s output (Kirchhoff, 2009).

Another effect of creative industries and advertising is the fact that in most cases they make use of modern technology and machines. This has had both a positive and negative effect in employment. The positive effect is that the employee works at a first rate thus getting time for leisure or time to pursue other interests.

The impact of creative industry on the labor market will depend on the policies set by the government. A government that supports the creative industry will be way ahead in creating employment. In addition to this there should be policies on the structures of employment to minimize on the insecurities in the advertisement industry and creative industries in general. In so doing the government will help in tapping the unexploited labor (Mestrovic, 2004). There is high potential for growth in the creative industries including in advertising (European Commission on culture, 2010).

The government or the relevant authorities should ensure policies that avoid exploitation of those who invent the products and services. In addition to this, the advertising industry can be used to erode culture through advertisements which are against the culture of the natives or through advertisements that may be discriminative in nature. This may lead to bans by the authorities which may lead to some people loosing their jobs.

In most creative industries labor is disorganized. This results from the fact that it is a young industry and which has not yet identified itself with the trade unions. According to Lovink and Rossiter (2007) the creations of creative industries have contributed to the erosion of the trade unions. Most of the people employed in this industry are young people. There is a possible feeling of insecurity in this industry, since the employees do not have the trade unions to defend their needs, thus creating social insecurity.

Most of the employees are self employed or are temporarily employed adding more to the feeling of insecurity. The sector employs people on contract or temporary basis thus a lot of insecurity involved. In the EU countries, 18 percent of employees in the culture industry were temporarily employed. 29 percent of those in the culture industry in the EU countries are self employed (Svob-Dokic, 2005).

Another negative effect of advertising has impacted on employment is that being a creative activity it employs modern technology and machines and thus creating unemployment to a number of people which results from the fact that the machines work at a faster rate than humans.

Conclusion

The amalgamation of culture, economics and technology has resulted to the growth in creative industries. There are many benefits that may result from the continuous growth in this industry. Creative industries assist in preserving people’s culture while at the same time earning income for the providers of these goods and services. The relevant authorities should come up with policies to protect their citizens from exploitation and to provide any other resources that may be required to ensure a stable growth in this industry.

Since each country holds different cultures, there cannot be a global policy in the creative industry; it is the responsibility of the government to put into place strategies that are relevant to its people. The industries growth will lead to employment. As it has been noted there is instability and insecurity in employment in the creative industries. The government should include policies to address this in its strategy. These strategies should be reconciled to other national policies for the country. In the end, the creative industries will create jobs, generate income, and promote social inclusion, cultural diversity and human development.