Preface

During the course of INCP meetings held throughout 2005, INCP officials identified the topic of the economic impact of culture as a theme for ministerial discussion during Session 3: Building the Future: A Discussion on Emerging Cultural Policy Trends and Issues, of this year’s Annual Ministerial Meeting. This document prepared by the Spanish Ministry of Culture, highlights the complex crosscutting nature of culture within society and draws attention to the general lack of cultural statistics that could assist governments in better assessing the impact of culture on employment, growth and social cohesion. This paper sets forth a list of possible lines of work on this topic and concludes with a series of questions aimed at initiating discussion.

Considerations

Cultural action can be understood from four basic perspectives: 1) the recognition of cultural diversity and its effects; 2) the pursuit of social cohesion; 3) the strengthening of cultural cooperation to promote mutual understanding and the development of peoples; and 4) as a source of wealth and economic growth.

However, the impact of cultural action is difficult to measure due to the differences in and lack of cultural statistics, as well as the absence of an approach that would allow countries to assess the complexity of the crosscutting nature of culture. The inability to measure the results of cultural action, in turn poses a significant challenge when attempting to define public policies.

In an effort to better understand the complex crosscutting nature of culture within societies, this document set forth the following three avenues for possible future research and analysis:

• The contribution of culture to employment. In addition to facilitating the emergence of the identity of each society, social group and individual and improving the structure, culture also contributes to the creation of employment that in turn improves social cohesion. Viewed in this context, culture can enhance the value of social life and become a tool for coexistence and conflict resolution.
• Culture makes a significant contribution to public revenues through taxes on cultural goods and services. While culture is often viewed primarily as government expenditure, it also significantly contributes to public revenue through taxation. As taxes from cultural goods and services return to public coffers, this promotes both social well being and cohesiveness for the entire community.
• Globalization, together with information and communications technologies, is changing the nature of cultural industries. The new models of cultural production and dissemination, adopted by multinational companies, have radically changed the economic importance of the cultural sector by significantly contributing to the Gross Domestic Product (GDP) of developed countries. However, this has often been to the detriment of the cultural sector of developing countries as well as the rich cultural diversity throughout the world.

This paper suggests three possible lines of work that can be employed to pursue the elements listed above:

1. In examining the relationship between culture and employment, one could explore aspects such as the:

• Quantification of cultural employment in order to evaluate its weight within the job market as a whole.
• Qualifications for cultural employment: the percentage of university and non-university graduates and participation in ongoing training activities to ensure or improve employability and, when feasible, to detect the needs of this job sector.
• Quality of cultural employment: temporary work, seasonal work, and job stability.
• Percentage of salaried and unsalaried workers and the structure of cultural employment in terms of age and gender.
• Effect of piracy on employment.

2. In examining the relationship between culture and taxation, one could explore aspects such as the:

• Average per capita spending on culture by governments.
• Average spending by individuals and households on culture.
• Ratio between government spending on culture and tax revenues from cultural goods and services.
• Tax pressure on cultural goods and services and possible alternatives for the future.
• Taxation (royalties and charges on multimedia, for example) and relocation abroad of cultural enterprises.

3. In examining the economic significance of the cultural sector, one could explore aspects such as the:

• Comparison of different cultural policies and public financial support for culture and the results.
• Weight of the cultural sector in a country’s Gross Domestic Product (GDP).
• Dominant market positions of distributors of cultural services and its impact on the cultural diversity remaining in the world.
• Coordination of cooperation for the protection of intellectual property.

Next Steps

Should INCP ministers choose to pursue one of the lines of work outlined above, it will be important to establish a work plan that would allow members to exchange views, research methods and best practices, in an effort to allow governments to better evaluate and highlight the importance of culture when establishing socio-economic and development cooperation policies. In addition, it would be important that the work plan include the coordination of a method by which INCP Member Countries could work together to establish common quantitative^[1] and qualitative^[2] objectives, take steps for greater convergence around those objectives, and evaluate the progress made in some of these areas. This document proposes that INCP Member Countries work together on a voluntary basis taking into account the realities of each member with respect to the availability of time as well as financial and human resources. Open coordination would be required if progress is to be made in protecting and promoting cultural diversity and strengthening the role of culture in the development of our societies.

Based on the analysis above and in order to better organize any debate, the following questions are suggested:

1. Which elements of cultural employment need to be improved and how can the contribution of culture to social cohesion and growth be increased?
2. To what extent do taxes on culture affect the market for and circulation of cultural goods and services and what tax measures could be proposed to give citizens broader access to culture?
3. Would open coordination and the establishment of common objectives be feasible? Also, would it be useful to set up a structure of some kind within the INCP framework to monitor and evaluate potential achievements?

Ideas on these and other aspects could be useful in evaluating and more closely defining the importance of culture and its role in the economy.

^[1] For example:

• Reducing the impact of piracy on employment;
• Increasing the participation of cultural professionals in ongoing training activities; and
• Increasing national screen quotas to combat the trends towards uniformization.

^[2] Examples include:

• Improving mutual understanding and intercultural dialogue;
• The presence and scope of cultural clauses in bilateral and multilateral agreements and conventions; and
• Progress in the geographic balance of exchanges.

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