4.10.1 The state’s role in culture may seem to be firmly established, but as long ago as the 1960s doubt was cast on whether the state should be direct- ly involved in the arts at all. The social objectives of making the arts available to all were not being convincingly attained; indeed, they remained the pre- serve of the affluent and the well educated. The debate took on a sharp polit- ical relevance with the rise of neo-liberal economic policies in Europe. State- owned industries were privatised, industrial subsidies reduced or abolished and monopolies (for example broadcasting and telecommunications) dereg- ulated. Support for the “high” arts was maintained, but a more commercial approach to fund-raising and management was encouraged.
4.10.2 Some research (for example, by the American economist, Fritz Machlup) has sought to show that the arts and related cultural activities con- tributed substantially to the gross national product. Economic arguments have been influential in regional and local government; however, they often depend on very broad definitions of culture and optimistic assumptions about multiplier effects. Other less obviously “committed” studies hold that the beneficial surplus effects of subsidy are so small that they are of little use to politicians trying to decide whether to raise, lower or abandon state invest- ment in the arts. In effect, decision makers have been left with a free rein. 4.10.3 Similar problems arise when governments include “cultural excep- tions” in free trade agreements to protect national cultural, and especially film and television, production. Economic analyses have assessed relative costs and benefits and the differential efficiency of various protective measures (for example special tariffs, quotas, latent barriers and production or distribution subsidies). They show that there is a risk of disguising investment and man- agement failure and discouraging sensitivity to changing market demands. A consensus among economists in favour of deregulation and against subsidy has emerged. However, some recent work based on industrial organisational theory suggests that, under certain conditions, import quotas can be helpful both to foreign and domestic producers as well as to the consumer. Similarly, there are cases where production and export subsidies have contributed to competitive efficiency, at least in respect of domestic markets. The audiovi- sual industries are a case in point. Quotas have done something to compen- sate for the huge advantage which the American domestic market confers on US exporters, allowing them to sell their programmes for as little as a tenth of the cost of their European equivalents. As a countermeasure, state pro- duction investment in France has quadrupled since its establishment. 4.10.4 The point is that the “first mover advantage” of the American audio- visual cultural industries is so formidable that a “fortress” policy often seems to remain the only option. Furthermore, it is argued that there is more to cul- ture than economics: the maintenance of creativity is intrinsically so impor- tant that subsidy must be added to restriction. A recent commentator
remarks: “It may well be the case that only non-economic arguments can rationalise the popularity of cultural protectionism. In that case, the econo- mist’s job is to guide policy makers to the less inefficient of the various pro- tectionist options.”1
4.10.5 Sadly, little authoritative guidance is yet available. What there is falls into two potentially useful categories. First, it is argued that certain kinds of artistic work should be seen as a collective good. If a distinction can be drawn between art which is valued according to consumer demand and that which acquires a significance through critical appraisal, intellectual property rights and the interests of collectors, “real” highly priced works of art become a col- lective good unconstrained by consumers’ subjective likings or preferences. Such arguments can help to justify public support for maintaining the “col- lective” cultural heritage and for seeing the arts as reservoir for exploitation (educationally, say, or commercially) by future generations. A difficulty with this line of thought is that it subordinates intrinsic artistic values to various utilitarian considerations.
4.10.6 A second approach is simply to take the arts out of the economic are- na altogether. In the same way that it finances the police or the military or education for some larger purpose, the state may simply decide to see the arts as a merit good for which a direct or indirect economic justification is super- fluous. It is a line of thought that may only be politically sustainable in the long run if this valuation of the arts is endorsed by the public at large. 4.10.7 In the absence of a general agreement on the economic justification of subsidy, all that can be said with certainty is that neo-liberal market poli- cies, combined with a perception that the Welfare State as at present defined can no longer be afforded, have weakened political commitment to public investment in culture in some countries.
Summary
It is more easily said than done to implement the four key principles underly- ing cultural policy, for decision makers face a range of obstacles, contradic- tions and dilemmas. Should the arts serve utilitarian purposes or does their importance lie only in their intrinsic worth? Keeping a balance between old and new – the “heritage” arts and often controversial innovations – is diffi- cult and in many countries perhaps too much weight is given to the former. Cultural policies have tended to be supply-led, but governments would now like more attention given to consumer preferences. Traditional ideas of artis- tic excellence have inhibited support for new forms of expression; how is one to find standards of judgement which cover the entire spectrum of creative activity? In the arts as elsewhere, the distinction between the public and pri- vate sectors is becoming blurred; if one or other is over-dominant, damage can be done to artistic production. Americanised global culture and the dom-
In from the margins
1. Seaman, Bruce A., “Considerations in adopting industrial organisational theory to the inter- national trade in cultural goods”, in Towse, Ruth, and Khakee, Abdul, (eds.) Cultural econom-
inance of the English language endanger the multicultural richness of the European arts; but do quotas and restrictions work? Despite a widespread commitment to support for cultural diversity, policy makers have not yet suc- ceeded in redressing the balance between mainstream and minority cultures. A new profession of arts administrators is emerging; but are they sufficiently accountable? A new liberal economics is challenging the fundamental tenets of arts subsidy; is cultural intervention effective?