Art Works in Economic Development
Urban and regional planners, elected officials, and other decisionmakers are increasingly focused on what makes places livable. Access to the arts inevitably appears high on that list, but knowledge about how culture and the arts can act as a tool of economic development is sadly lacking. This important sector must be considered not only as a source of amenities or pleasant diversions, but also as a wholly integrated part of local economies. Employing original data produced through both quantitative and qualitative research, Creative Communities provides a greater understanding of how art works as an engine for transforming communities.
“Without good data and analysis—much of it grounded in economic theory—we cannot hope to strengthen communities through the arts or to achieve any of the other goals we set for the National Endowment for the Arts, the largest nationwide funder of the arts.” —from the Foreword by Rocco Landesman
Contributors: Hasan Bakhshi (Nesta UK), Elisa Barbour (University of California, Berkeley), Shiri M. Breznitz (Georgia Institute of Technology), Roland J. Kushner (Muhlenberg College), Rex LaMore (Michigan State University), James Lawton (Michigan State), Neil Lee (Nesta UK), Richard G. Maloney (Boston University), Ann Markusen (University of Minnesota), Juan Mateos-Garcia (Nesta UK), Anne Gadwa Nicodemus (Metris Arts Consulting), Douglas S. Noonan (Indiana University–Purdue University Indianapolis), Peter Pedroni (Williams College), Amber Peruski (Michigan State), Michele Root-Bernstein (Michigan State), Robert Root-Bernstein (Michigan State), Eileen Roraback (Michigan State), Michael Rushton (Indiana University), Lauren Schmitz (New School for Social Research), Jenny Schuetz (University of Southern California), John Schweitzer (Michigan State), Stephen Sheppard (Williams College), Megan VanDyke (Michigan State), Gregory H. Wassall (Northeastern University)
2013. Ann Markusen, Anne Gadwa Nicodemus, and Elisa Barbour. In Michael Rushton, ed., Creative Communities: Art Works in Economic Development. Washington, DC: The Brookings Institution.
Economic development strategy at the regional/state/local levels has been dominated by economic base theory, which posits that exports drive overall growth levels. Because large portions of arts creation, production and presentation are consumed locally, arts advocates find it difficult to compete for economic development resources. Following a review of export base theory and
its uses, this paper argues that consumption base investments can create sustained jobs and growth 1) by offering residents opportunities to spend more of their discretionary income locally; 2) by seeding innovations that may expand to
export markets in time; 3) by nurturing organizations and occupations that re-spend more of their earnings locally than do other sectors; and 4) by attracting and retaining entrepreneurs, firms and workers, a supply-side growth stimulus.
The paper uses cross-sectional data on California and other US cities, metros, and regions to show that 1) high differential rates of arts organizations per capita exist at both regional and city levels; 2) arts participation rates vary marked among regions; and 3) the metro density of artists (including self employed) varies substantially. Regression of arts organizational presence and arts participation on a set of resident socio-economic and local economy characteristics finds that differentials cannot be fully explained. Furthermore, comparing the Los Angeles and San Francisco Bay regions, there is no evidence that the concentration of for-profit cultural industries in Los Angeles is accompanied by comparable nonprofit arts activity, either offerings or participation.
The paper concludes by hypothesizing that over the longer-run, evolutionary capacity building by individuals and organizations can create a nonprofits arts and cultural sector that contributes sustainably to jobs and incomes as well as providing the intrinsic values of the arts.
Ann Markusen is Director of the Arts Economy Initiative and the Project on Regional and Industrial Economics at the University of Minnesota’s Humphrey School of Public Affairs, and Principal of Markusen Economic Research. In recent years, Markusen’s research and consulting has focused on artists, arts organizations, and creative placemaking.
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