Culture, Art and Creativity for Virtuous Cycles of Economic Development in a Post-Pandemic World: Some Quick Thoughts

By Lorenzo Bona

Culture, art and creativity can help communities grow their own economies.

Unfortunately, today – at the time of this writing – cultural and creative industries appear as some of the economic sectors most heavily hit by the current pandemic related with the spread of the Covid-19.

One of the main features for these industries is the high level of variety and diversification of the economic actors that directly (e.g. an artist) or indirectly (e.g. an electrician) contribute with their work to the functioning and evolution of these industries.

For example, one the one hand, different types of businesses, like multinational companies, small businesses and independent professionals participate in the production of cultural and creative goods. On the other hand, focusing on the suppliers of these types of goods, it is possible to observe that firms that can only benefit from private sector exchanges coexist together with other economic entities that can rely on forms public support.

The way this pandemic is hitting cultural and creative industries introduces particularly challenging situations (to say the least) not only for the many and diversified economic subjects that are directly or indirectly linked to the offering of cultural and creative goods, but also for the related communities, where these industries are located.

These challenging situations – on a more general level – largely reflect extremely heavy costs that the current pandemic is producing: first of all, in terms of destruction of human lives, and – secondly – in terms of loss of revenues in the entire economy.

As well known, in response to this health and economic crisis a series of new rules and measures has been suggested and introduced by public and health authorities in order to minimize the spread of the virus: for example social distancing, self-isolation, good hygiene practices and – when unrelated to something considered essential for society – suspension of numerous economic activities, as it greatly happened in the cultural and creative industries.

Fortunately, at the date of writing, several places appear to experience some gradual, slow and cautious improvements with respect to the health and economic emergency, but sadly, at the same time, it is not completely clear when things – everywhere – can return to a situation of full normality.

Adapting to this new scenario, many individuals, companies and institutions – that are directly or indirectly connected with the production of cultural and creative goods – appear to be also thinking about viable and fruitful plans that could support, in a post-pandemic world, a satisfactory recovery and development of the activities that make possible for these goods to be supplied.

For example, on the one hand, several governments have tried and/or are trying to respond (in ways that can greatly differ from one country to another) with various forms of financial assistance and/or schemes of support. On the other hand, a large number of firms, organizations and professionals that are devoted to the offering of cultural and creative goods are trying to expand their online presence.

Expanding the online presence to fight or mitigate the negative economic effects of the current crisis may however result in a remedy that unfortunately may not be fully and equally effective for all the economic entities that make up the industries that are analyzed in this writing: for example, differently from some digital companies that – by virtue of the nature of their business model – can benefit from a growth of their online presence, other companies are in fact based on business models that appear much less dependent from online strategies and, in contrast, much more reliant on the realization of live events for public gatherings.

In relation to all this, it may also have some relevance to recall that that recent comments have also emerged in ways that seem not only express some concerns about the fragility of significant parts of the cultural and creative industries, but also underline the importance of solidarity efforts in support of these industries and their more fragile parts, in order to avoid the emergence of long-lasting economic and social damages.

The relevance of these types of concerns could perhaps be better understood if we introduce a few other reflections largely based on some ideas that some economists have suggested about the impact that cultural and creative industries can have on economic and urban development strategies.

In this perspective, a first aspect that might be helpful to recall is that “culture” might be something slippery to define, as this concept – with some simplifications – can be used to refer to beliefs, habits and customs of social groups, as well as activities and products related to the intellectual, moral and artistic life of human beings.

And, in light of this, it could be usefully added that tangible and intangible aspects coexist in the concept of culture, in ways where these coexisting aspects tend also to experience an evolution in time that – in turn – can have deep effects on individuals and communities, especially in relation to goals of economic efficiency and economic equality.

For example, on the one hand, customs and traditions that promote the value of verbal agreements between trading parties usually tend to produce greater levels of trust within the related communities, in ways that can also determine reductions in the costs of economic transactions.

On the other hand – as reflected in many debates like those around the links between intergenerational equity and sustainable development – moral and ethical opinions about the problem of equity may stimulate different strategies for organizing relationships between younger and elder groups of people in relation to given goals regarding the use of resources.

Without going into too much detail, the things above summarized about cultural and creative goods, their relationship with tangible and intangible aspects and the tendency for these aspects to evolve in time with substantial impacts for individuals and communities can perhaps be rephrased by saying that these goods are able to have a strong influence on individual and collective interests.

And with some connections to this, it may also result helpful to recall an additional interesting aspect that is incorporated in cultural and creative products and services: in contrast to what happens with standard economic goods (for example, an apple), where the consumption or use of one of these goods by one individual reduces the availability of the same good to others, the act of consumption of cultural products or services is not subject to this type of logic. Cultural and creative goods can be enjoyed, at the same time, by more than one individual, in ways where the consumption/enjoyment of these types of goods tends also to produce new forms of creativity and cultural goods – as it frequently happens, for example, when two or more persons are watching simultaneously the same movie or listening to the same song, and someone of these persons start sharing new ideas and thoughts after the enjoyment of these cultural goods.

Reflecting on what could happen at a local level when communities supply cultural and creative goods in ways that tend to diverge from the general preferences or interests expressed by their citizens, a significant stream of research in economics suggests that the citizens will “vote with their feet”, moving to communities where their interests can be better satisfied. This way, places that develop, or already have, the ability to attract people in search of the social, mental and physical benefits that are attached to cultural and creative products and services will tend to be more efficient in promoting economic dynamism and prosperity than places that appear less prepared to do the same.

History seems to offer a solid basis for this line of reasoning.

For example, the widespread revival in art and culture at the time of the Renaissance greatly influenced an extraordinary economic rebirth of Florence and other Italian cities, in ways that also favored the emergence of a period of great innovation and progress in several other places of Renaissance Europe, as for example it happened in many urban centers that today are located in Belgium, Netherlands and France.

On the other hand, if we consider much more recent phenomena like world fairs, art shows and educational conventions that are organized in many modern cities around the globe, it is not too difficult to discover the extraordinary ability that these type of events have in attracting large amounts of people, in ways that – at the same time, appear greatly helping these cities in their wealth creation efforts.

Trying to reach some conclusions, the reflections outlined so far seem to justify a vivid hope that the many benefits that culture, art and other expressions of human creativity are able to offer to individuals and communities can stimulate the emergence of new forms of solidarity efforts as well as new forms of entrepreneurship in support cultural and creative industries: it appears fundamentally important for our future that these industries will be able to overcome as safely and as soon as possible these challenging times, in order to continue to grow and have – also in a post-pandemic world – a central role in promoting virtuous cycles of economic and urban development.