Film Festivals and the Enrichment Economy: Cultural Value Chains in a Digital Media Age 3031335007, 9783031335006

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Film Festivals and the Enrichment Economy Cultural Value Chains in a Digital Media Age

Ann Vogel Alan Shipman

Film Festivals and the Enrichment Economy

Ann Vogel • Alan Shipman

Film Festivals and the Enrichment Economy Cultural Value Chains in a Digital Media Age

Ann Vogel University of Applied Sciences Guestrow, Germany

Alan Shipman Open University Milton Keynes, UK

ISBN 978-3-031-33500-6    ISBN 978-3-031-33501-3 (eBook) https://doi.org/10.1007/978-3-031-33501-3 © The Editor(s) (if applicable) and The Author(s), under exclusive licence to Springer Nature Switzerland AG 2023 This work is subject to copyright. All rights are solely and exclusively licensed by the Publisher, whether the whole or part of the material is concerned, specifically the rights of translation, reprinting, reuse of illustrations, recitation, broadcasting, reproduction on microfilms or in any other physical way, and transmission or information storage and retrieval, electronic adaptation, computer software, or by similar or dissimilar methodology now known or hereafter developed. The use of general descriptive names, registered names, trademarks, service marks, etc. in this publication does not imply, even in the absence of a specific statement, that such names are exempt from the relevant protective laws and regulations and therefore free for general use. The publisher, the authors, and the editors are safe to assume that the advice and information in this book are believed to be true and accurate at the date of publication. Neither the publisher nor the authors or the editors give a warranty, expressed or implied, with respect to the material contained herein or for any errors or omissions that may have been made. The publisher remains neutral with regard to jurisdictional claims in published maps and institutional affiliations. This Palgrave Macmillan imprint is published by the registered company Springer Nature Switzerland AG. The registered company address is: Gewerbestrasse 11, 6330 Cham, Switzerland

Preface

Long before the current interest in experience as an economic factor, Tibor Scitovsky called attention to what we call ‘consumption as investment’—the problem that we are chasing throughout this book. Cultural products—once associated only with leisure enabled through ‘productive’ economy activity—are the true consumer durables, yielding a continuing stream of satisfaction and potentially holding or gaining in value for as long as they are preserved. Yet when that value is converted into income and profit, it often flows too far away from those who first created it, indicating widespread power imbalances and capture of rents in the cultural value chain. The rise of digital platforms distributing commercial and user-generated media content on an unprecedented scale, and the online migration of entertainment and exchange since the global COVID-19 pandemic have highlighted the importance of this phenomenon. Cultural production based on ‘human desire’ is now the basis for a fundamental re-think of the role of economy in society. Once subsistence needs are satisfied, ‘culture’ may be the only industry that can sustainably keep growing. As Scitovsky wrote, “the conventional economic distinction between satiable needs and insatiable desires, with the latter driving economic progress, may be unjustified,” the latter having distinct superiority as drivers of economic progress.…As insatiable demand is unlimited demand, growing with rising incomes, it could also mean unfillable demand. Such demand would merely raise the prices but not stimulate the economy. Only unlimited, not unfillable demand stimulates the economy serving as its engine of growth” (Scitovsky, 1987). v

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PREFACE

The ‘enrichment economy’, proposed by sociologists Boltanski and Esquerre, identifies as core trait the escalation of luxury to generate experience that can be mass-consumed, detaching it from the ‘distinction’ that is only attained if few consume it. The cultural value chains that deliver this have some elements in common with other industries’ global value chains, but also many unique features—in the way they generate and socially distribute value—which we have investigated in this book. Having worked on eventization together beforehand, we have culled and combined economic and sociological insights to underline that the current economy of enrichment is largely enabled by eventization. This book emerges from the idea that this is best told by value chain analysis, which also led us to the formulation of the cultural value chain, which we hope will be used in further research. The social process of eventization is fundamental to understanding differentiation in art and cultural activities, especially in the question of ‘live art’ vs. ‘digital art’. Should one go to see a real Picasso in a museum, collectively mobilize for live performances in the Castro, accept a ‘virtual dress’ as a gift in place of ‘real’ material, or be in awe when an ‘old master style’ painting is confirmed as authentic Rembrandt? While it may not give a definitive answer, our proposed analytics for value chains offers ideas to better understand why cultural ‘upgrading’ may not guarantee prosperity and sustainability, and why the spread of cultural production might lead paradoxically to widening inequality due to opportunities for creation and capture of rent. We acknowledge the support by the editorial team. Guestrow, Germany Milton Keynes, UK 

Ann Vogel Alan Shipman

References Tapscott, D. (2015). The digital economy: Rethinking promise and peril in the age of networked intelligence. McGraw-Hill Education. Scitovsky, T. (1987). Growth in the affluent society (Fred Hirsch Memorial Lecture of 7 October 1986). Lloyd’s Bank Review, 163, 1–14.

Abstract

This book’s central tenet is that cultural production involves non-profits in today’s cultural economy, providing peculiar forms of governance and new possibilities of chain integration. The cultural value chain is an analytic tool to capture and potentially critique the making of intangible products as the core accumulation strategy of the aesthetic-digital economy. As the ‘digital economy’, a contemporary economic reality, already challenges the standard framework of industry (Tapscott, 2015), we aim to outline and illustrate an alternative framework that may generate future research including eventization for which we provide new theoretical insights. The cultural value chain analysis can be applied to cinematic art, which is a key component of the global media value chain in its contemporary configuration. Keywords  Artistic rent • Baumol effect • Brokerage • Buzz • Chain integrator • Cinema • Cultural value chain • Enrichment economy • Eventization • Global value chain • Intangible assets • Rent • Valuation

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Contents

1 Introduction  1 Economic and Cultural Value   5 Enrichment via Immersive Events   8 Nonprofits: Putting Value into Chains with Festivals   9 Chain Integration: New Ideas for Cultural Value Chains  10 Artistic Rent: Exploiting Creativity  11 Outline of Chapters  11 Bibliography  12 2 Research  Fundamentals of Global Value Chain Analysis 17 Basic Elements of the Research Approach  18 Key Concepts for Cultural Value Chains  22 Chain Integrator  23 Governance  24 Power  25 Quality Conventions: Valuation Sociology for GVC Analysis  28 Rent and Value  29 Conclusion  32 Bibliography  33 3 Introducing  the Special Dynamics of the Culture Value Chain 39 The Smile Curve and the Scowl Curve  40 Cultural Value Chains: Deviating from Standard Form  42 ix

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(Re-)defining Cultural Products  46 Creative Art  47 Cultural Performance  48 Stock of Capital and Flow of Product  49 The Scowl Curve: Concluding Remarks  52 Bibliography  54 4 Enrichment Economy 57 Media in CVCs  58 Enrichment and Value Determination  60 Enrichment and the Economic Process  61 Asset Form and Standard Form  65 Collection Form  66 How Asset and Collection Forms Inter-relate  68 Trend Form  70 Conclusion: Value Chain Analysis for the Enrichment Economy  72 Bibliography  74 5 Source  of Cultural Value-Added: Eventization 79 When Consumption Becomes Investment: Enter Events  80 Performativity  83 Impact Studies  88 Film Festivals  90 Networks and Hierarchization  91 Value Networks  94 Audience-Side Networking  94 Conclusion  96 Bibliography  96 6 Rents  and Redistribution in the Cultural Value Chain101 Artistic Rent 102 Private, Public, and ‘Club’ Elements in Cultural Production 108 The Artistic Rent as a ‘Social Rent’ 112 Exogenous Rents in the Global Media Value Chain 114 Cultural Clusters 115 Networks 117 Arts Brokering and Management as Exogenous Rent 118 Summary 119 Bibliography 120

 Contents 

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7 Artistic  Value, Ricardian Rent, and Power127 Cultural Value Capture 128 Growth of Cultural Stocks and Intangible Assets 129 Balancing Value-Capture and Value-Chain Sustainability 132 Chain Integrator 133 Events as Chain Integration Sites: A Research Proposition 134 Festival Fragility Hypothesis 135 A Broker’s Solution: Organizational Grafting 139 Buzz: ‘Performing Art’ in Global Media Value Chain 140 Cultural Measurement 142 Emergent Dynamics of Socially Constructed Valuation 143 Conclusion 147 Bibliography 147 8 Conclusion  and Future Research Direction155 Bibliography 161 Bibliography163 Index187

List of Tables

Table 1.1 Table 3.1 Table 5.1 Table 5.2 Table 6.1 Table 6.2

Competing explanations for income inequality in the cultural/creative industries Classifications of cultural industries Forms of commercialized experience based on Pine and Gilmore (2011) Value chain linkages Kaplinsky’s rents and the artistic rent, illustrated with nonprofit-­festival events (developed from Kaplinsky, 2021) Four-way typology of goods according to (Fig. 1.1. Hess & Ostrom, 2011, p. 9; Witesman, 2016)

6 44 86 95 104 109

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CHAPTER 1

Introduction

Abstract  We explain our approach to studying valuation and power dynamics in cultural value chains (CVCs), using film festivals as an empirical test for broader conclusions on the economics of cultural production. We aim to show how enrichment and eventization are central sources of ‘value-added’ in cultural production and how differences in power and incentives along a typical CVC lead to the redistribution of income via the capture of artistic rent. We also draw lessons about contemporary trends involving convergence of industrial and cultural production—the use of culture to upgrade industrial products, the fusion of culture with information channels and media chains, expansion of an ‘experience economy’ (now accelerated by carbon reduction imperatives), and the emergence of technologies that replicate the ‘immersive’ experience of a  live performance (whose uptake may have been accelerated by the global lockdown experience of 2020–22). Keywords  Value-added • Creative work • Enrichment • Festivalization • Eventization • Rent capture • Nonprofit organization

© The Author(s), under exclusive license to Springer Nature Switzerland AG 2023 A. Vogel, A. Shipman, Film Festivals and the Enrichment Economy, https://doi.org/10.1007/978-3-031-33501-3_1

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Contemporary ‘cultural production’ comprises those activities whose rewards to consumers are predominantly sensory. ‘Cultural products’ (objects and services) are created and distributed in industrial sectors. These now extend to  music and stage performance, film and TV production, broadcasting, publishing, advertising and marketing, architecture, crafts and fashion, as well as software and computer games. The study of the extension of these industries (Hesmondhalgh, 2007; Caves, 2000) has long relied on standard ‘industrial classifications’ that were first designed in higher-income economies with large manufacturing sectors. But the new source of ‘valueadded’ that emerges from nonmanufacturing value chains defies classification as a marketed or nonmarket service. In this book, we argue that value creation in ‘cultural value chains’ is characterized by significant elements of rent, including a previously unclassified artistic rent, and that power differences within the chain determine who captures that rent. The economist Kelvin Lancaster (1966) showed long ago that the standard theory of demand can be derived from the subjective experiences and other characteristics that consumers might obtain from different goods and services, rather than from physical products in themselves. Moving a physical product, technology, or service upmarket often consists mainly in enhancing the aesthetic, material, and social experiences it delivers, with a neutral (or even negative) effect on practical performance. Advertising and marketing of such products traditionally harnesses cultural associations, emotions, and experience alongside factual information, but cultural value chains produce aesthetic and reputational products in a wider range of value chain locations. Cultural production is often a solo or small-group activity that, even when commercialized, is delivered predominantly by  micro-enterprises with fewer than ten employees (Metro-Dynamics and Arts Council England, 2020; Chung et  al., 2018) and by  self-employed individuals. Creative work (‘cultural production’ in this book) also extends into other sectors where these activities add value, even in higher proportions in high-income economies than in their core creative sectors (Freeman, 2014). With the spreading of creative work, craft practices and labor contract forms have been adopted along with management ideologies and practices emerging in creative workplaces (Potts & Cunningham, 2008; Jones et al., 2016). Value-adding process associated with creativity sheds light on observable similarities with knowledge production as problem of valuation (e.g., Cassier, 2021). There has been increasing convergence between

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knowledge and cultural production, with artists becoming ‘knowledge workers’ and technologists acquiring methods and practices from the arts they find inspiring and both becoming Schumpeterian entrepreneurs (Reckwitz, 2017b; Baglioni et al., 2020). Cultural products, like knowledge products, emerge from particular sectors (such as R&D facilities, higher education, and the high-tech industry) but enter production across a much wider range of sectors, and may make their biggest value-added contribution in these. Among the many similarities are the high level of non-financial motives for producing art and knowledge, often being the product of low-paid or unpaid labor, and generating financial flows that do not find their way back to the original creator, which creates a dilemma for creatives. Both cultural and knowledge production are characterized by an uneven spread of rewards, with a few entrepreneurs and managers commanding substantial, often excess pay and decision-making power while a long tail of employees receive much less. Although many in cultural production could be regarded as supporting creativity rather than directly performing it, the contributory role of arts administration and backstage work vital to the exhibition and performance of cultural product remains understudied. Similarly, support for knowledge production, involving a division of labor and manual operations without which most knowledge could not be produced, remains invisible. The most innovative products often emerge from small-scale firms or even individuals working in isolation, although subsequent production, distribution, and marketing may be passed to larger organizations with a deeper division of labor and powerful positions in value chains. Cultural and knowledge production both tend to be geographically clustered—held together by specialist local labor skills and external economies of scale Knowledge-based clusters are viewed by policymakers as strong generators of employment that requires transferable skills training and provides income for other producers, meriting public subsidy for investment and expansion (Mazzucato, 2019). Cultural clusters have very similar economic effects and input requirements, and a comparable mixed-­ economy structure combining firms, entrepreneurial governments and nonprofit organizations as field participants (Witesman, 2016). Art and knowledge are both subject to intellectual property (IP) rights regimes as well as to public subsidization and philanthropy (Towse, 2008). IP rights enable their tradability at a price assumed to reflect expected future financial rewards. Both cultural and knowledge products

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(or most of them) are costly to produce when compared to mass-manufacturing, but may be replicable (especially digitally) at low cost, leading to a problem of cost recovery for original producers, which IP rights are meant to address. With the advent of digital recording and transmission it becomes easier to separate cultural and knowledge products from their original producers. More of the ‘tacit’ (Polanyi, 1958) can be rendered explicit, promoting commodification and making IP protection more difficult (Towse, 2020). Finally, both fields are impacted by a process of ‘aesthetic heightening’ (Reckwitz, 2017b; Böhme & Engels-Schwarzpaul, 2017) and the curation of their products and processes leads increasingly to their delivery as ‘events’ (Moeran & Strandgaard Pedersen, 2011; Gross & Zilber, 2020). Events hint at a preference for weakly institutionalized, intermittent, and organizationally fragile forms, observable in all high-skill sectors globally. Both cultural and knowledge production are converging in a digital ‘experience economy’ (Pine & Gilmore, 1999) in which showcases and many other types of events to perform surprise and novelty seem abundant. We argue that without them—and their base in “voluntary and redistributive regimes” (Witesman, 2016)—cultural value chains would have been less expansive today. Small and mass-market production of ‘experience goods’ (Schulze, 2013) requires an analysis specific to the valuation of the range of cultural production. This extends to the way that goods are ‘enriched’ (Boltanski & Esquerre, 2020) to become experiential, serving as source of value-­ added in this capacity. Digitization makes an important contribution to this process—since it can be viewed as the separation of the ‘experience’ element of cultural consumption from the manufactured or service elements with which it was previously combined. ‘Eventization’—the creation of immersive environments that are of short-term durability and experienced as cultural encounters—is a more widely observable long-­ term structural change that drives parts of the global economy. It has been interpreted as a defensive response, by artists and organizations that showcase their work, against the economic pressures of commoditization and/ or ‘Baumol effects’ (Shipman & Vogel, 2022). This book attends to the observable trend that cultural production, which was once arranged by regular timetables, and so routinized to a large extent, is now broken up into a smaller number of distinct events, around which a more impressive and immersive audience experience can be built.

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Economic and Cultural Value The use of creative inputs from arts and culture to add value to economic products has drawn increasing interest from social scientists, as part of a wider drive to re-appraise the meaning and sources of ‘value’ as well as understand super profits and superstar phenomena (Karpik, 2011; Elder-­ Vass, 2016; Beckert & Musselin, 2013). Jobs associated with creative industries carry a relatively high degree of respect and status, reflecting the background and education of their typical practitioner, and the high public profile of most ‘superstars’ in the field. Yet, there is an unusually high proportion of low-paid, unpaid, casualized, and insecure employment in a great variety of occupations in the industries central to cultural and knowledge production (Burton & Bowman, 2022; Brook et al., 2020; Szreder, 2021; Banks et al., 2013; McRobbie, 2002) that has received insufficient attention by valuation sociologists (for an exception see Mears, 2011). These durable patterns seem paradoxical given the incorporation of cultural activity and labor resources in regional and global value chains, raising the question of who benefits from value-added (Guèvremont et al., 2021). So far, the coexistence of high industry-ascribed value and low individually realized reward has generated four competing explanations for the relationship between value-added and rent extraction: Baumol effect, Superstar effect, commodification, and exploitation. Baumol effect—Cultural production is among the service activities that depend on human labor whose productivity is hard to improve (Baumol & Bowen, 1965, 1966). Only a limited number of people have creative talent needed to be a professional artist or performer, and each can only deliver a maximum number of performances or production hours without their creative quality ebbing. As a result, cultural products—like other service outputs—rise steadily in price compared to manufactured goods and mass-producible services where labor productivity can be steadily increased. This squeezes the margin between cultural products’ price and cost, and restricts the income available to cultural producers, even if audiences are willing to pay an ever-rising relative price for cultural experiences. Superstar effect—Cultural products command a high value in the marketplace, but the rewards are asymmetrically distributed, with most flowing to a handful of high-paid ‘superstars’. The talents of these top p ­ erformers

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may be only marginally superior or different from their rivals, but that margin is enough to enable vastly greater ticket-sales prices, and pay demands (Rosen, 1981). Superstars may further enhance their financial advantage by taking firmer control of their IP rights in recorded material, and by developing and protecting their personal brand. Commodification—Cultural products have become a commodity, commanding little or no market price (or prices that only cover production costs) and leading to failure of a substantial income stream to most who work within cultural production. Recording technologies undermine the  original uniqueness of each artistic performance or artifact, challenging producers and their sponsors to find ways to restore their past singularization. Commodification is exacerbated by a rising number of competing producers (facilitated by globalized and online distribution of live performances) as well as by the increasing substitutability of easily reproducible recorded performances, including re-released back catalogues, for the live performance experience, enabling supply to grow faster than any rise in paid-for demand. Commodification is mainly that of art objects (and less of art performances), as they become more mass-­ produced (e.g., cinema film for television), and recorded especially digitally. Even a unique artwork can have very close substitutes in the form of similar work including deliberate imitations or accidental duplications. Exploitation—Cultural production generates a healthy excess of revenue over cost, and profits are not unduly concentrated on superstars. Instead, they are extracted (as rent) by individuals or groups who exercise power within the production process. These may be industry intermediaries such as distributors, impresarios, curators, and auctioneers; or owners and managers of organizations that run large-scale arts events; or shareholders and other investors who finance the industry and projects within it. The following table shows the classification of these well-known hypotheses along the dimensions of value-added and rent extraction (Table 1.1). Table 1.1 Competing explanations for income inequality in the cultural/ creative industries

Rents

Value-added

High Low

High Superstar effect Baumol effect

Low Exploitation Commodification

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Our argument supplements and challenges these explanations. First, regarding the commodification thesis, we add the organizational tool of the ‘event’ as defense against commodification (of objects) and income loss, stressing that they might themselves have become commodities, as events get closely replicated at different times and places and as a good recording of an event can become a commodity (Shipman & Vogel, 2022). Eventization only works as a defense if the event keeps expanding or adapting in form. Second, while there is merit to all four hypotheses, which are mutually consistent (in this sense ‘additive’), we show that two additional concepts—the cultural value chain and the ‘artistic rent—are needed to explain more fully how and where value-added arises and to help identify the locations of value creation and of rent extraction. Rent is defined as ‘excess’ profit made possible by control of a scarce resource, with the scarcity often artificially created or maintained (Kaplinsky, 2021). How types and spectrum of rent are generated, appropriated, and protected in the media economy is important for determining value from cultural work. Extraction leads to (or at least exaggerates) the extreme inequality of income distribution within the arts. Our notion of the ‘artistic rent’ theorizes and helps identify the measurement of a particular phenomenon, which is excess profit (or rent) from cultural labor. The Baumol effect-thesis excludes the existence of rent to be extracted as it would argue that cultural production costs rise as fast as revenues, and profits get squeezed. While not identifying or explaining rents, the three other explanations are consistent with the rent approach. None is a general or complete explanation for the paradoxical observation of money-­ making sectors with pockets or extensions of prevalent nonprofit forms as well as a precarious labor force. Superstar effect, Commodification, and Exploitation all contribute to a process of capital accumulation labeled ‘enriching’ (Boltanski & Esquerre, 2020). By observing ‘artistic rent’ and eventization as a trend in cultural and knowledge production, we expand on this economic-sociological theory, illuminating how and why artistic rent arises and can be analyzed by a cultural-value specific framework and its power distribution, thus assisting comprehension of how some players can get paid more than their value-­ added and so capture rent. We now introduce key concepts necessary to cultural value chain analysis.

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Enrichment via Immersive Events In the enrichment theory (Boltanski & Esquerre, 2020), historical capitalism is identified by different degrees of commodification, one of which is the contemporary ‘enrichment economy’. Its major valuation form is called ‘collection’, enabling much bigger profits than can currently be made from standard objects (Susen, 2018). In Chap. 4, we introduce the cornerstones of the argument, relating it to empirical illustrations from the media value chain to further identify this enrichment economy in terms of the relationship between four valuation forms (the others being asset, standard, and trend form). This theory is relevant because arts and cultural festivals quite visibly use cultural enrichment strategies. In a discussion of a French village historicizing its cultural value (and, as it turns out, inventing a few aspects of it), Boltanski and Esquerre acknowledge the increasing role of immersive-environment curation, including a variety of forms of cultural heritage-making practices as seen all over the world (Gonzalez Zarandona, 2016; cf. Bottà, 2020). The enrichment economy goes much further, cultural events having a crucial global-economic and cultural policy role (Vogel, 2012; Barrow, 2016). We will argue that eventization’s role is underestimated in the enrichment theory, as the collection form cannot operate without the valuation form that is ‘trend’, and which is observable with the increasing demand for events. Eventization is a major conditioning process as well as a process that can be digitized, thriving on the medium of the live performance as well as on the Internet. Both forms—collection and trend—appear to expand with digitization in a way that engenders a new configuration with asset and standard forms respectively, clearly observable in the significant expansion of the global IP rights regime, an important source of value extraction for some (Towse, 2020). Eventization accelerates cultural production—as a force driving the spread and differentiation of more temporary, more heterogeneous, and more immersive forms—in this sense also being precursor and companion to the now digital production of more ‘instant’ social forms of products and practices, such as identifiable in social media, the click-worker, and the prosumer (Pal & Toby, 2014).

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Nonprofits: Putting Value into Chains with Festivals While Boltanski and Esquerre pay attention to cultural employment (Boltanski & Esquerre, 2020, p.  343), they pay disproportionally less attention to the organizations that translate between practices and structures surrounding valuation. As nonprofits frequently deliver performances, events, and other services that generate revenue in excess of cost—creating conditions for income flow that others can capture as profit or rent, we examine the relationship between events, nonprofits, and valuation. With few exceptions, the nonprofit organizational form has been examined  for its contribution to value-added (e.g., DiMaggio, 2006) while intermediary power is the object of the Exploitation hypothesis (see Table  1.1). Our cultural value chain approach probes the relationship between nonprofit value and seasonally performing organizations, inserting them into the value chain rather than keeping them in a  peripheral market organizing function (Ahrne et al., 2015). Cultural intermediaries have been ignored in most economic analyses of value-added processes. Events in value chains involve regular inputs of nonprofit labor from entrepreneurs, skilled and unskilled workers, and a still fledgling labor movement that takes on labor insecurity (e.g., #WeMakeEvents, USA). We assess eventive nonprofits as a functional resource in value chains and suggest how they can be incorporated in value-added analyses. To focus our analysis, we draw on film festivals, which have been studied extensively (Valck & Damiens, 2023), and belong to an ecology in which they interact with the media industries through a variety of cultural production and consumption forms, including award ceremonies and film archives, film cooperatives, university student film clubs, critics associations and more. Film festival activities are exposed to the global media value chain in various ways that have repeatedly raised the question of festivals putting value into the chain (de Valck, 2007). Studying this problem not only requires a powerful theoretical framework, which we see in ‘enrichment’, but also an analytic heuristic for value chains.

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Chain Integration: New Ideas for Cultural Value Chains Guided by empirical research (Carroll Harris, 2017) and relevant insights from the global value chain (GVC) framework, we hypothesize ‘chain integration’ by nonprofit event productions. We examine whether the rising use of festive (or positive) events—‘festivalization’—is an enrichment process that represents a case of rent capture from art nonprofits in some of the most aggressive business environments known by “There’s no business like showbusiness” (Irving Berlin, 1946). Studying nonprofit value in the chain seems timely as event nonprofits do not just reflect a particular institutional form but materialize public life and civil society demands, which seem to be able to perform in economic processes at diverse locations of the world economy, as the global film festival network shows. Our analysis in this regard is aided by the fact that more recent GVC analysis takes an interest in non-firm actors as well as in the role conventions play in economic life—two aspects enrichment theory and GVC research share (Diaz-Bone & Salais, 2011; Ponte, 2009; Bolwig et al., 2010). While GVC scholars primarily focus on the location of ‘value creation’ within a chain, identifying where most profits are made along the passage from the extractive stage of raw materials to customers and final consumption, they can draw on the model of the Smile Curve (Shih, 1992; Meng et  al., 2020). This model demonstrates the tendency for post-Fordist manufacturing to concentrate value creation in the pre-production (design, research, and development) and post-production (customization and finishing, marketing, distribution, after-sales service) stages, with intervening production being outsourced to low-cost and low-margin suppliers. For development and international trade policy, Smile Curves highlight the possibility of unequal exchange, with offshore outsources providing goods and services virtually ‘at cost’, ceding value to the corporations for which they subcontract (Shih, 1992). We believe that an alternative scenario—the Scowl Curve—reflects better economic production and consumption where cultural value is key. In cultural value chains (CVCs), low-cost artistic production is endemic and occurs in nonprofit organizational contexts. Nonprofit formation follows the nondistribution rule (Powell & Steinberg, 2006) and is based on voluntary redistributive exchange (Witesman, 2016) while being in proximity to wage labor forms starkly resembling ‘normal’ employment. This pattern will be addressed with our concept of the ‘artistic rent’.

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Artistic Rent: Exploiting Creativity Cultural production and the value of creativity have moved to the center of the capitalist economy in a way cultural-employment statistics have not yet represented so well (Becker, 2017; Reckwitz, 2014; Hardt, 1999). The broad range of cultural workers, together with their occupations and professional (or informal) systems tends to allow the income that they generate to be captured by others in the value chain. This leads to (or at least exaggerates) the extreme inequality of income distribution within the arts. In explaining  why an elite of performers, director and curators scoop almost all the income for today’s cultural production, the ‘cost disease’ hypothesis (Baumol & Bowen, 1965) may apply only partially. We make a conceptual and practical distinction between what we call ‘creative’ and ‘cultural’ performance to analyse  curated atmospheres and immersive environments as ‘live production’ for creative and cocreative expression. The concept of rent (Kaplinsky, 2021) is essential to illuminating value-­ adding in CVCs and the potential of rent extraction through functions associated with value chain integration. Therefore, the artistic rent serves to identify a missing type in Kaplinsky’s scheme, which denotes value generated by artists and cultural workers who are willing to work ‘for the art’, for less pay than they might generate in the market. Previous analysis (Bourdieu, 1983, 2016) articulated this pattern as a ‘disposition’ located outside the commercial sphere. Current cultural production, however, does correspond with this theoretical perspective, partly because nonprofits provide arts and culture as convenient way of participating in culture’s many market places.

Outline of Chapters Chapter 2 provides ‘research fundamentals’ of the well-known GVC framework, summarizing fashion key concepts needed for our analysis such as governance, power, rent, as well as GVC scholars’ approach to ‘qualification’ (Callon et al., 2002). In Chap. 3, we turn to the need to conceptualize cultural value chains, providing preliminary distinctions for cultural product that we derive from performativity theory (e.g., Butler, 1990). Distinguishing between ‘creative art’ and ‘cultural performance’ gives us a handle to separate cultural production more analytically and explore the relation between immersive curations and valuation. Based on

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these arguments, we show that the Scowl Curve rather than the Smile Curve identifies more optimally the location of value-added, underlining location in the chain (a value network) as significant to value capture in cultural and knowledge production. In Chap. 4, we investigate ‘enrichment’ as an approach that explicitly theorizes the creation and transfer of value, the nature of capital and the precarious position of labor in the cultural value chain at the confluence of collection and trend form. In Chap. 5, we turn to the event and its organizing ‘agency’, the nonprofit, introducing film festivals as seasoned actors in the global media value chain, showing how festivals add value, and why they’ve grown. Discussing festivals’ performative aspects and their curations, we argue that the festival is functionally similar to a cultural cluster, concentrating activity in time as well as space, and enabling high volumes of interpersonal networking. Chapter 6 sets out the different forms of rent, including artistic rent as element in the value chain and exogenous rent in the global media value chain. It discusses the nature of the good that the nonprofit organizational form realizes in festival-event production and argues that the sources of cultural value can give rise to rent, identifying clusters, networks, and arts management as rent-generating sources of added value. In Chap. 7, we then address the distribution of power in the value chain that determines who captures the rent (and who concedes it). Turning toward ‘buzz’, a key concept in valuation studies, Chap. 7 develops a new approach that addresses simultaneously value embodied in cultural objects and value arising from the ‘social capital’ in interpersonal networks. This serves to highlight that the media value chain has entered the digital age, which offers a whole ‘new’ world of immersive experiences, forcing cultural production to develop and use digital technology to import the buzz of the live event into the recordings and transmissions that people consume in private spaces. The value chain location we analytically determine is that of the chain integrator, a position we conceptualize with network-theoretical ideas of stabilization of fragile brokers.

Bibliography Ahrne, G., Aspers, P., & Brunsson, N. (2015). The organization of markets. Organization Studies, 36(1), 7–27. Baglioni, E., Campling, L., & Hanlon, G. (2020). Global value chains as entrepreneurial capture: Insights from management theory. Review of International Political Economy, 27(4), 903–925. https://doi.org/10.1080/09692290. 2019.1657479

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Banks, M., Gill, R., & Taylor, S. (2013). Theorizing cultural work: Labour, continuity and change in the cultural and creative industries. Routledge/Taylor & Francis Group. Barrow, S. (2016). Constraints and possibilities: Lima Film Festival, politics and cultural formation in Peru. New Review of Film and Television Studies, 14(1), 132–148. Baumol, W. J., & Bowen, W. G. (1965). On the performing arts: The anatomy of their economic problem. The American Economic Review, 55(1/2), 495–502. Baumol, W. J., & Bowen, W. G. (1966). Performing arts: The economic dilemma. Twentieth Century Fund. Becker, H. S. (2017). Creativity is not a scarce commodity. American Behavioral Scientist, 61(12), 1579–1588. Beckert, J., & Musselin, C. (Eds.). (2013). Constructing quality: The classification of goods in markets. Oxford University Press. Berlin, I. (1946). There’s no business liuke show business, from Annie Get Your Gun. Böhme, G., & Engels-Schwarzpaul, A. (2017). Atmospheric architectures: The aesthetics of felt spaces. Bloomsbury Academic. Boltanski, L., & Esquerre, A. (2020). Enrichment: A critique of commodities. Polity Press. Bolwig, S., Ponte, S., Du Toit, A., Riisgaard, L., & Halberg, N. (2010). Integrating poverty and environmental concerns into value-chain analysis: A conceptual framework. Development Policy Review, 29(2), 173–194. https://onlinelibrary. wiley.com/doi/10.1111/j.1467-­7679.2010.00480.x Bottà, G. (2020). Deindustrialisation and popular music: Punk and ‘post-punk’ in Manchester, Düsseldorf, Torino and Tampere. Rowman & Littlefield International. Bourdieu, P. (1983). The field of cultural production, or: The economic world reversed. Poetics, 12(4), 311–356. Bourdieu, P. (2016). The rules of art: Genesis and structure of the literary field. Polity Press. Brook, O., O’Brien, D., & Taylor, M. (2020). Culture is bad for you: Inequality in the cultural and creative industries. Manchester University Press. Burton, S., & Bowman, B. (2022). The academic precariat: Understanding life and labour in the neoliberal academy. British Journal of Sociology of Education, 43(4), 497–512. https://doi.org/10.1080/01425692.2022.2076387 Butler, J. (1990). Gender trouble: Feminism and the subversion of identity. Routledge. Callon, M., Meadel, C., & Rabeharisoa, V. (2002). The economy of qualities. Economy and Society, 31(2), 194–217. Carroll Harris, L. (2017). Theorising film festivals as distributors and investigating the post-festival distribution of Australian films. Studies in Australasian Cinema, 11(2), 46–58.

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Cassier, M. (2021). Value regimes and pricing in the pharmaceutical industry: Financial capital inflation (hepatitis C) versus innovation and production capital savings for malaria medicines. BioSocieties, 16(3), 323–341. https://doi.org/ 10.1057/s41292-­020-­00214-­4 Caves, R.  E. (2000). Creative industries: Contracts between art and commerce. Harvard University Press. Chung, C.  C., Yang, L., & Cauldwell-French, E. (2018). Growing the UK’s Creative Industries: What creative enterprises need to thrive and grow. Creative Industries Federation. de Valck, M. (2007). Film festivals: From European geopolitics to global cinephilia (Film culture in transition). Amsterdam University Press. Diaz-Bone, R., & Salais, R. (2011). Economics of convention and the history of economies: Towards a transdisciplinary approach in economic history. Historical Social Research, 36(4), 7–39. DiMaggio, P. J. (2006). Nonprofit organizations and the intersectoral division of labor in the arts. In W. W. Powell & R. Steinberg (Eds.), The nonprofit sector: A research handbook (pp. 432–461). Yale University Press. Elder-Vass, D. (2016). Profit and gift in the digital economy. Cambridge University Press. Freeman, A. (2014). London’s creative workforce. Pages 78-92  in G.  Hearn, R.  Bridgstock, B.  Goldsmith, & J.  Rodgers (Eds.), Creative work beyond the creative industries: Innovation, employment, and education. Edward Elgar Publishing Ltd. Gonzalez Zarandona, J. A. (2016). Making heritage at the Cannes Film Festival. International Journal of Heritage Studies, 22, 1–17. Gross, T., & Zilber, T. B. (2020). Power dynamics in field-level events: A narrative approach. Organization Studies, 4(10), 1369–1390. Guèvremont, V. r., Mariage, M., Chehidi, F., Ngankam, D.  D., & UNESCO Chair on the Diversity of Cultural Expressions. (2021). Fair Culture: A key to sustainable development. Online at https://www.unesco.de/sites/default/ files/2022-01/FairCulture_engl_online_0.pdf Hardt, M. (1999). Affective labor. Boundary, 26(2), 89–100. Hesmondhalgh, D. (2007). The cultural industries. Sage. Jones, C., Svejenova, S., Pedersen, J. S., & Townley, B. (2016). Misfits, mavericks and mainstreams: Drivers of innovation in the creative industries. Organization Studies, 37(6), 751–768. https://doi.org/10.1177/0170840616647671 Kaplinsky, R. (2021). Rents and inequality in global value chains. In S.  Ponte, G.  Gereffi, & G.  Raj-Reichert (Eds.), Handbook on global value chains (pp. 153–168). Edward Elgar Publishing. Karpik, L. (2011). What is the price of a scientific paper? In J. Beckert & P. Aspers (Eds.), The worth of goods (pp. 63–85). Oxford University Press.

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Lancaster, K. J. (1966). A new approach to consumer theory. Journal of Political Economy, 74(2), 132–157. https://doi.org/10.1086/259131 Mazzucato, M. (2019). The entrepreneurial state debunking public vs. private sector myths. Penguin Books Anthem Press. McRobbie, A. (2002). Clubs to companies: Notes on the decline of political culture in speeding up creative worlds. Cultural Studies, 16(4), 516–531. https://doi.org/10.1080/09502380210139098 Mears, A. (2011). Pricing beauty: The making of a fashion model. University of California Press. Meng, B., Ye, M., & Wei, S.-J. (2020). Measuring smile curves in global value chains. Oxford Bulletin of Economics and Statistics, 82(5), 988–1016. https:// doi.org/10.1111/obes.12364 Metro-Dynamics, & Arts Council England. (2020). The impact of arts & culture on the wider creative economy. Metro-Dynamics. Moeran, B., & Strandgaard Pedersen, J. (2011). Negotiating values in the creative industries: Fairs, festivals and competitive events. Cambridge University Press. Pal, A., & Toby, M. (2014). The prosumer. Social Identities, 20(4–5), 259–261. Pine, B. J., & Gilmore, J. H. (1999). The experience economy: Work is theatre and every business a stage. Harvard Business School Press. Polanyi, M. (1958). Personal knowledge. University of Chicago Press. Ponte, S. (2009). Governing through quality: Conventions and supply relations in the value chain for South African wine. Sociologia Ruralis, 49(3), 236–257. https://doi.org/10.1111/j.1467-­9523.2009.00484.x Potts, J., & Cunningham, S. (2008). Four models of the creative industries. The International Journal of Cultural Policy, 14(3), 233–247. Powell, W. W., & Steinberg, R. (2006). The nonprofit sector: A research handbook. Yale University Press. Reckwitz, A. (2014). Creativity as dispositif. In H.  Knoblauch, R.  Tuma, & M.  Jacob (Eds.), Culture, communication, and creativity (pp.  23–34). PL Academic Research. Reckwitz, A. (2017b). The invention of creativity: Modern society and the culture of the new. Polity Press. Rosen, S. (1981). The economics of superstars. The American Economic Review, 71(5), 845–858. Schulze, G. (2013). The experience market. In J. Sundbo & F. Sørensen (Eds.), Handbook on the experience economy (pp. 98–121). Edward Elgar. Shih, S. (1992). Empowering technology – Making your life easier. Acer. Shipman, A., & Vogel, A. (2022). Streaming the festival: What is lost when cultural events go online. Review of Social Economy, 1–21. https://doi.org/10.1080/ 00346764.2022.2099006 Susen, S. (2018). The economy of enrichment: Towards a new form of capitalism? Berlin Journal of Critical Theory, 2(2), 5–98.

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Szreder, K. (2021). The ABC of the projectariat: Living and working in a precarious art world (Whitworth manuals). Manchester University Press. Towse, R. (2008). Why has cultural economics ignored copyright? Journal of Cultural Economics, 32(4), 243–259. Towse, R. (2020). Dealing with digital: The economic organisation of streamed music. Media, Culture & Society, 42(7–8), 1461–1478. https://doi.org/ 10.1177/0163443720919376 Valck, M. d., & Damiens, A. (2023). Rethinking film festivals in the pandemic era and after. Palgrave Macmillan. Vogel, A. (2012). Film festivals in Asian cities. In P.  W. Daniels, K.-C.  Ho, & T.  A. Hutton (Eds.), New economic spaces in Asian cities: From industrial restructuring to the cultural turn (pp. 67–86). Routledge. Witesman, E. M. (2016). An institutional theory of the nonprofit: Toll goods and voluntary action. Nonprofit and Voluntary Sector Quarterly, 45(4_suppl), 97S–115S. https://doi.org/10.1177/0899764016651729

CHAPTER 2

Research Fundamentals of Global Value Chain Analysis

Abstract  The chapter summarizes global value chain (GVC) analysis and its implications for firm strategy to identify which ideas can be carried over (and which need rethinking) when analysing cultural production. It sets out the concepts incorporated subsequently into a cultural value chain (CVC) framework. Key insights emerge from GVC analysis in relation to the sources of value-added, the conversion of value-added into profit at different locations of the chain, the scope and incentives for cost reduction to improve value-added, and the use of price-setting power to enhance profitability by capturing rent. We observe that while ‘mainstream’ GVC analysis implies an unplanned integration of chains through market transactions along their length, some participants can exert chain-integrating power. But GVC patterns based on discrete manufactured goods or marketable services may not be directly applicable to CVCs whose product is more experiential than tangible and dependent on the quality of connection performers (as producers) and audiences (as consumers). This discussion suggests that, in CVCs, chain integrators have diversified into a spread of devices that help overcome barriers of market processes. We show how power can be deployed to capture rent, defined as income in excess of what producers need to keep producing. An initial analysis of types of rent reveals a neglected type, but central to CVCs. Keywords  Value chain • Chain integration • Isomorphism • Power • Rent • Valuation © The Author(s), under exclusive license to Springer Nature Switzerland AG 2023 A. Vogel, A. Shipman, Film Festivals and the Enrichment Economy, https://doi.org/10.1007/978-3-031-33501-3_2

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The global economy consists of vast networks of global production over which economic as well as political actors seek control, and which are acknowledged as “the quintessential organizational form of contemporary global capitalism” (Baglioni et al., 2021, p. 4). The real-world significance of value chains—the object of the Global Value Chain (GVC) framework (Gereffi, 2018)—was recently made conspicuous when the world’s COVID-19 pandemic brought some nodes and segments of supply chains to slowdown or even standstill, thereby underlining the failure by governments around the world to secure inventory for times when national security challenges had to be met. Inventory itself is a business cost preferably shoved on to nodes in the value chain that can hold supply less costly than what is considered ‘downstream’ where value-added processes ensure better profit margins. More recently, the value chains’ importance to national and regional economies was underlined again as agro-industrial food chains were interrupted by Russia’s war of aggression on Ukraine, a world producer of grains, causing strain in world markets and adding to already protracted food shortages in many African countries. Value chains shaped by transnational corporations make up around 80% of world trade (IGLP, 2016). An analytic discussion of cultural production, the contemporary global media and their consumption cannot ignore GVC analysis, as the media play a huge role in ‘human desire and economic satisfaction’ (Scitovsky, 1987) as well as their aesthetic and technological basis. In this synopsis we concentrate on governance, chain integration, power, rent, and valuation concepts to build a base for our cultural value chain (CVC) arguments. For an encompassing overview of the GVC framework we recommend a recently published handbook (Ponte et al., 2021), and critical studies (e.g., Baglioni et al., 2020).

Basic Elements of the Research Approach The interdisciplinary organizational-studies framework known as GVC analysis developed out of global commodity chains research (Gereffi & Korzeniewicz, 1994; Raikes et al., 2000) into a heuristic commonly used by applied and basic social scientists—and away from critical industrial sociology (Baglioni et al., 2020, p. 904). Like many sociological concepts it became a managerial and policy concept stripped of its epistemological background. The focal object has been firm strategy in relation to investigations of dense and fast-changing inter-firm networks, geographically highly interdependent industry and market structure, and challenges to

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industrial structure from the growing collective power of final consumers characterized by heterogeneous and unpredictable tastes. Regarding firm strategy, the ‘lead firm’ has been center-stage. A lead firm is defined as actively engaging in the assignment of key roles to ‘regulate’ the profit structure across the many stages of the value chain. Principally, a firm has the potential to control production and trade flows of activities and opportunities it wants to create, or is involved in when created by others. This sets up the case of inter-firm networks at all levels of the economy, involving identifiable lead firms and supplier firms in their mutual relations. Chains are conceptualized in terms of ‘upstream’—away from the focal firm toward extraction—and ‘downstream’—away from the local firm toward the area of most value-added. The chain is a dynamic construct because firms are considered moving through areas of perceived value, trying to go where they can capture most value. The individual value location can be the result of firm strategy, but GVC analysts are more broadly interested in a process called ‘upgrading’, which concerns not firms in particular, but entire industries, and thus national-policy strategy. The notion of industrial upgrading captures how the host of production factors typical of a value chain under observation can together shift toward the areas of higher value-added. “The possibilities for upgrading are already structured in and through law—that is, how law constitutes the power relations between actors that give rise to particular forms of governance and engender particular distributive effects” (IGLP, 2016, p. 5). There is an adopted bias from real-world industrial capitalism in this key concept, transporting the idea that the more natural or non-treated an economic object is, the less value added) it contains. The implication, that lack of refinement means lack of value to the capitalist entrepreneur, has been applied to most natural objects—but not to land, minerals or fossil fuels like gas and oil, which have been successfully framed as a highly valuable good by oil-rich countries turned rentier states (Beblawi, 1987; Marriott & Minio-Paluello, 2013). The general tendency is to treat natural resources as inferior to the industrial, physical, or interpretive valuation processes unless they can be incorporated in some sort of growth and innovation scenario, which is understood as necessary condition for industrial upgrading. This bias works in a similar way for the production of consumer goods, where people simply wanting a ‘natural way of life’ can only be included in industrial processes through ‘enrichment’. For example, manufacturers devise products for people who want ‘natural looks’,

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‘natural foods’, etc. that can be produced and potentially sold in niche or mass markets. GVC analysis veils some of these economic realities, which are important to for the analysis of cultural production and the ways in which cultural production affects GVCs in which large-scale manufacturing is the core process. More recent efforts are dedicated to examine how the law creates possibilities for upgrading (see also Pistor, 2020, pp. 23–46; IGLP, 2016) and how standardization is not just technical in nature but has a base in management classes (Baglioni et al., 2020, p. 904). The study of multinational production has been divided, from the start, between a mainstream analysis that emphasizes efficiency (and implies spontaneous integration) and a more radical analysis in which large corporations manage international production as an extension of their monopoly or monopsony power (Hymer, 1970; Rowthorn & Hymer, 1971). When its power over buyers and suppliers is considered, the large firm is no longer that of Alfred Chandler, using its ‘visible hand’ just to lower costs and gain profit (Fligstein, 2008); current firm strategy models being also related to rent-seeking. The value chain approach formulated its own crucial distinction between what it called the producer-driven commodity chain (PDCC) and the buyer-driven chain (BDCC) (Gereffi & Korzeniewicz, 1994), marking not just different ways for firms to dominate the chain, but also a historical shift in the way the capitalist economy works, known as the ‘retail revolution’ (Lichtenstein, 2010). Coordination and control could be achieved without actual ownership over industrial process. PDCC refers to producer-controlled industrial process, from the major source up to all the industrial processes, such as in airplane production. BDCC highlights that actors in the ‘middle’ of the chain control it (rather than those placed on the top of a chain or dominating by ‘vertical integration’). Consumer products such as bicycles, fashion accessories, and garments were produced in BDCCs (Feenstra & Hamilton, 2006). Such ‘Big Buyers’ were soon seen as the major drivers in the evolution of the global consumer goods markets, shaping producing from the demand side in GVCs (Ponte & Sturgeon, 2014), and being labeled market-makers (Hamilton et  al., 2011). This BDCC/PDCC distinction was soon eroded, as firms could also come to dominance as Big Suppliers, the Internet and e-commerce further complicating the picture (Gereffi, 2001; Özer & Raz, 2011; Flynn & Flynn, 2017; Lonsdale, 2001). The study of Big Buyers provided insight into how specialization could turn into intangible assets in firm identity, such as when a ‘brand firm’ that holds nothing but intangible or symbolic resources incentivizes other firms to

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manufacture products under their ‘label’, while taking care of marketing and distribution. Big Buyers are known for outsourcing the entire production functions to a network of suppliers, allocating tasks within the chains they build and exerting power over its constituents by monopolizing the functions of coordination and intermediation. This powerful position gives them influence over price-setting along the chain, and the transfer of rents from some participants to others. Although the chain remains the dominant metaphor, because it encompasses stages of production and highlights weakest-link vulnerabilities, the framework accommodates numerous additional configurations, such as networks among firms that produce for and purchase from many others, and star-shaped clusters of small suppliers round a dominant assembler. Global Production Networks (GPN) is an approach to examine real-world complexity beyond a study of firms (N. M. Coe et al., 2010). These extensions, particularly on clusters (Di Maria et  al., 2021), are vital to the understanding of production and trade with intangible commodities and services, as they facilitate inquiry into the diversity of noneconomic actors and alternative modes of economic coordination, converging on the neglected issue of theorizing power in economic networks. In a chain, production moves sequentially between stages and sites, usually starting with raw materials and proceeding through the addition of intermediate inputs to final assembly, into a product that then passes on to distribution and retails sites from which final customers buy and consume it. Power could reside at any point along the chain: some are dominated by producers of raw material or intermediate inputs, some by final assemblers, some by wholesale or retail distributors who impose their prices and designs on the earlier production stages, and some by specialist ‘chain integrators’ who configure and manage the chain while standing entirely outside it. A network implies the connection of production operations to a central node, allowing stages to occur simultaneously (as well as sequentially) and in a geographical cluster (rather than a scatter of sites with one-­ way transport links between them). In  GPNs, “structural attributes are overlain by relational ties between specific actors which are contingent and dynamic, actors ‘drawing on different forms of power to occupy advantageous position favoring value creation, retention, and capture’ (N. M. Coe & Yeung, 2015, pp. 66–67). In practice, contemporary production maps for particular products tend to show a combination of chains and networks, with linear configurations turning increasingly into networks as supply-chain management

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advances (Stevens & Johnson, 2016). Suppliers tend to cluster geographically around major users of their goods and services, for logistical ease and to utilize a specialist labor market. But major purchasers also develop longer-­distance links with strategic suppliers, to source specialist inputs and to ensure a diversity of sources for resilience if one or more break down. Industrial purchasers also seek to draw on more than one source, and suppliers to win long-term contracts with more than one major buyer, to avoid the problems of ‘hold-up’ and adverse bargaining outcomes when one side has monopoly or monopsony power (Williamson, 1985, pp. 15–42). In the remainder of this chapter we address the concepts that we incorporate in our framework for the CVC: chain integration, governance, power, and rent. We also note the valuation-sociological interest in GVC scholarship that connects to the theory of enrichment (see Chap. 4).

Key Concepts for Cultural Value Chains Economists conventionally explain the emergence of GVCs by appealing to efficiency. The allocation of production to forms and geographical areas where it is probably most efficient, and the integration of production stages to minimize cost and maximize speed from initial extraction to final consumption, emerges from free market competition. Any chains that are less well allocated or integrated will suffer higher costs. Competition will force them either to upgrade to match the efficiency of the best change or to downsize and disappear. In this free-market representation, chains become organized for maximum efficiency (and attainable profitability) but there does not have to be a single, visible organizer. The same ‘invisible hand’ (Smith, 1979 [1776]) that allocates labor, materials, capital, and the products they make ensures the efficient integration of the chain. Yet, empirical examination of GVCs presents a rather different picture, in which each participant in the chain tries to organize and plan the flow of resources in and out of it, while differing greatly in the power they can assert over those downstream or upstream from them. One player often emerges with the power to shape and send orders down the whole chain. This has been addressed with recent ‘return to theory’, leading to the development of two typologies. The first acknowledges variety in ‘governance’, where the binary of ‘market vs. hierarchy’ is replaced with a spectrum of different inter-firm

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relations (Gereffi et al., 2005). The second aims to ‘bring back in’ power, going beyond simple transactions in exchange relationships that have been dominating the basic processes of GVC actors and activities (Dallas et al., 2019). In addition, management studies have turned attention on a business model detected in some contemporary powerful firms, describing these as ‘chain integrators’ (Mitchell, 2014). We now look at chain integration before turning to the more abstract typologies of governance and power, respectively. Chain Integrator Different from the conventional ‘lead firm’ role, chain integration essentially describes a business model that some large firms have been able to fill as a role. It refers to the ability to coordinate activities of the actor throughout the value chains that the actor in question is able to define—and control that definition. Historically, such roles have always existed, but have not fitted the image of a competing marketeer. Mitchell’s demonstration of the value chain integrator (VCI), exemplified by Apple, emphasizes the firm’s strategy to ‘build, borrow, and buy’, which are in-house functions, inter-firm network participation (or coordination), and the tactic of mergers and acquisitions—common GVC firm behavior (Mitchell, 2014). VCIs coordinate the direct and indirect relationships of all actors making up the “commercial ecosystem, overseeing the upstream, downstream and complementary activities that need to be accomplished for products to reach markets efficiently […] so that projects maintain agility” (Mitchell, 2014, p. 19). This includes identifying product development, product life cycle, the synchronizing of design and production cycles with the key suppliers in the chain, and even recycling. In Apple’s case, the control exerted over the final product (and effectively the end-user of its gadgets) is a powerful stratagem originating from Steve Jobs’s market leadership approach (Isaacson, 2011). This is mirrored in tight specifications for suppliers and occasional offerings of exclusive agreements for selected components in exchange for volume guarantees. Systemic work and control over chain integration allows for the regular introduction of new products while keeping its price premium and relatively simple supply chain configuration. Apple’s more complex processes are centered on the R&D stage. Chain integrators can be powerful players within the value chain (such as the main buyer of the final outputs, or producer of the least

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substitutable components), or may be a GVC coordination specialist with exercised buying (and allocation) power over all the members of the chain. More recent work has found that the monopolization of such functions is not specific to Big Buyers (first modeled on the retail companies coordinating production and distribution for consumer-goods markets). Chain integration has diversified into a spread of intermediation agents and practices, also known as devices that help overcome barriers of market processes. In a GVC, the lead firm is regarded as extraordinarily profitable when it has the capacity to generate different kinds of rents as returns from tangible, intangible, or intermediate assets. Rent-related processes are reflected in activities by firms specialized and specializing in core competencies and which also outsource competencies to other firms, thereby becoming part of production networks that economics can explore as a value chain (Baglioni et al., 2021). Governance The diversification of inter-firm networks has been acknowledged in a five ideal types of  governance (Gereffi et  al., 2005) derived from variety in inter-firm relations, firm and network capabilities, and inter-firm competition. Based on how complex an inter-firm transaction is and who can codify the transaction as well as on the capabilities of the supply base, Gereffi and coauthors drew up market governance (arms-length trade solely based on the price mechanism), governance by hierarchy (integrated firm, or vertical integration), and three governance principles briefly explained. The modular governance (closest to market governance on the typological spectrum) represents the inter-firm network where suppliers make products according to the lead-firm specification. This entails high volume of codified information flowing and the lead firm concentrating on product innovation and market participation. Suppliers are organized in networks delivering to a turnkey supplier all the manufactured components. Its counterpart on the other side of the spectrum is the captive governance mode, where suppliers are short of being integrated into the ‘vertical hierarchy’ but exposed to high volume of monitoring. While being able to draw on the resources of the lead firm in exchange for closer ‘surveillance’, they are not well positioned to bargain for higher prices. The middle of the spectrum is taken by what they call relational governance, capturing

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the scenario of more complex information, not easily alienable objects, and demanding more basic social interaction involving trust or social capital (Hernández & Pedersen, 2017, pp. 140–141). Market governance is associated with low barriers to entry; captive governance and the integrated firm are associated with intermediate barriers to entry; and both modular and relational governance come with high barriers to entry. To be successful, firms must have specific capabilities that correspond with the different governance configurations, such as internalizing the activities (versus spreading them over a network they can still control in the various ways) or organizing social capital, as in relational governance, or monopolizing resources and binding knowledge (intangible assets) for exclusive exploitation, as in captive and vertical governance. The realization of such capabilities depends also on a number of factors, including conventions and change in the corresponding industries, the position as early mover or late entrant to the industry, entry barriers, technological change, or change in demand of the produced and intermediate goods. The configurations gain complexity, challenging both monitoring agents and researchers, when firms participate in more than  one chain, developing different strategies depending on value location. Power While Gereffi, Humphrey, and Sturgeon looked at inter-firm relations, Dallas, Ponte, and Sturgeon (Dallas et  al., 2019) challenged the long-­ term GVC approach to firms as ‘agent-centered, direct and coercive’. A focus on the firm and its management tends to omit the existence of more diffuse forms of power, including coercion, agenda-setting, preference-­ shaping, and social construction (meaning: habituation) that are part of the macro-level governance of a GVC (Ponte & Sturgeon, 2014). Asking how power is transmitted—in a direct or diffuse way—and between and among whom it is transmitted—dyad or collective actor set—they present four types of power, which are called bargaining, demonstrative, institutional, and constitutive power—briefly introduced in the following.  yads: Bargaining and Demonstrative Power D ‘Bargaining power’ regards power being directly transmitted in a dyad of social actors. Common in all governance configurations discussed so far, these relations vary across types in terms of asymmetry. Dyadic relations

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also exist between firm and non-firm actors, such as a firm lobbying politicians for exlusive deals, which may express the situation of sheer market might or industry power. ‘Demonstrative power’ also defines the nature of dyadic relation between firms, but this form of power operates in a diffuse mode in, flowing informally and along the value chain (we must assume some communication process here that they exclude). It can also ‘affect’ other value chain actors (thus apart from hearsay and gossip or friendship talk, it may be the power to impress others with some admirable characteristics). ‘Demonstrative power’ can be shaped by quality conventions implicitly accepted by the interacting firms, and it is argued to drive isomorphism in the chain regardless of firms’ respective position. In relation to the governance typology (above), ‘demonstrative’ power should occur in chains where information is more complex and not easily alienable, therefore generating more interaction not strictly related to price, and possibly even what Weber disparaged  in non-rationalized markets as ‘­bickering’ (Weber, 1922).  eyond Dyads: Institutional and Constitutive Power B ‘Institutional power’ is not dyadic but defines an arena of actors. As a directly transmitted form, this power can be observed in things such as government regulation and stakeholder initiatives. It can be leveraged through industry standards and appear as codified ‘best practices’. ‘Institutional power’ can also be ‘agenda-setting’ by setting de facto and de jure standards (cf. Baglioni et al., 2020, p. 914). Dalles and coauthors re-include it in dyad relations where power is directly transmitted. Finally, ‘constitutive power’ denotes the operation of diffuse power among a collective of actors, such as observable widely accepted norms and expectations. It is associated with isomorphism within industries, and can arise from decentralized collaboration or simply new practices and norms. It mirrors the definition given for the diffuse power transmission in dyads. In our view, the finer differences between the meanings of these powers can be more easily understood  by drawing on the sociology of isomorphism. DiMaggio & Powell (1983) outline three processes of isomorphic behavior—coercive, normative, and mimetic—occurring alongside competition (equating ‘bargaining power’ in our context). ‘Coercive isomorphism’ appears broadly equal to ‘institutional power’, the state being a key actor imposing rules, but not stakeholders, a set of relatively powerful actors in global capitalism. ‘Normative isomorphism’ underlines the power of the professions, and may be likened to ‘institutional’ and ‘constitutive

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power’ as this refers to collective processes (intergroup and group power) not dyads (not ‘demonstrative power’). ‘Mimetic isomorphism’ is essentially what Dallas and coauthors circumscribe with ‘demonstrative power’, where diffuse processes of resemblance and contagion are at work, affordances (Gibson, 1977) rather than rules guide the actors’ thinking, feeling, and doing. Interestingly, the process has never been aligned with an institution or process as for state and professions, but was broadly referring to firms behaving so under conditions of high uncertainty (see also Beckert, 2010). The typology is particularly relevant to the empirical reality of ‘relational governance’ (the ‘middle’ type discussed above) which emerges when information is complex, ambiguous, and where it may not be alienable (i.e., cannot be easily ‘dis-entangled’ to then be codified to create control and possibly rent). Transmission mechanisms at both dyadic and collective (arena) level will develop enable updating information necessary to compete and survive in industry and market. Interaction (and this may include nonsocial devices in support of communication paths) will be more elaborate, based on trust or a social-capital exchange. Furthermore, the discussion of power and governance together is helpful when considering ambiguous or difficult levels of alienability requiring intermediation, as is the case for many goods of cultural value as recently elaborated in an ‘economics for singularities’ (Karpik, 2010). Economics for singularities—that is, for goods of high uncertainty—also concerns the ‘network-market’, a phenomenon operating as a resource structure to govern certain value chains circumscribed as relational—associated with higher uncertainty due to lack of codification. To extend this argument, codification is not just appropriation of well-bounded information; it also entails the ‘legal form’ of the object made property (Deakin et al., 2017). This already points to specifics of cultural production but is not exclusive to it. Finally, with high interaction, as typical for mediated economic encounters, norms of reciprocity (Gouldner, 1960) may emerge, helping conflict-­ solving and also reducing conflict in that, threats to the ecosystem in question can be responded to without large conflict and much delay. Relational governance configurations emerge in response to high levels of uncertainty, but tend to lend themselves to better containment of conflict, navigating away from larger conflict. This resonates with the evolution of collaborative forms for economic coordination (J.  Graham & Gandini, 2017; Begum & Anjum, 2016).

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Some of the most powerful firms today (such as Apple) have the power to set terms of trade and market evolution, but not as ‘hierarchy’—rather as a particularly powerful player within the GVC, or as an organization outside it that specializes in the coordination of production—essentially designing the chain but then contracting-out all the functions along it. This economic actor emerges from competitive processes in an industry, through appointment by an industry association, or as outcome of formal agreements among partnerships. This leads to a long-demanded ‘holistic view’ of the economy, as coordinating efforts necessitate some minimum of collaboration and cooperation while maintaining competitive behavior. Quality Conventions: Valuation Sociology for GVC Analysis ‘Qualification’ (M. Callon et al., 2002) affects GVCs through the need to comply with industry technical standards and government regulations for coherent cross-border production, and to meet customer expectations in such areas as quality and fair-trade certification. The qualification of firms and individuals is of particular importance in CVCs, where it is a key determinant of what gets classed as ‘creative’, how it is valued and who receives that value. GVC scholars (Ponte et al., 2011; Ponte & Gibbon, 2005) acknowledge that control of the process of qualification can be a key power source adopted by lead firms, but also that qualification increasingly involves re-qualification by other actors, including weak or traditionally peripheral ones such as NGOs. Relations among the chain actors can be shaped by quality conventions, which are neither government regulation nor broadly accepted norms or even best practices (‘constitutive’ and ‘demonstrative’ power, as summarized above). This research direction builds on the program of the economics of convention, drawing on justification, convention, and critical capacity theoretizations (Boltanski & Thevenot, 1999, 2006). Ponte and colleagues apply this scheme to standard economic concepts (see also Eymard-Duvernay, 2002), to derive a set of different organizational principles that are associated with foci of justification, key testing questions, measure of product quality, and ease of transmission along VCs. Ease of transmission is high when quality conventions correspond to competitiveness and productivity, low when corresponding to loyalty and creativity, and medium when corresponding to representation and reputation. This proposition is easier to understand when expressed as ‘grand persons’, a notion by Boltanski and Thévenot for each convention domain

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(six orders of worth): Ease of transmission along the chain is high in case of the competitive market entrepreneur and the standards-based operating industrialist, low for actors placing emphasis on loyalty, trust, and tradition, as well as (for creativity) the artistic, innovation-driven person. It is medium, however, for actors who consult and negotiate, and those who are focused on opinion and public (Ponte & Sturgeon, 2014, p.  208). Trust and traditions are difficult to transmit along the chain but can be eased with, for example, appellations such as in the wine industry (Garcia-­ Parpet, 2011). The other three types concern ‘barriers’ to transmission along the value chain such as derived from collective commitment to welfare (a product being judged by its impact on society, thus outside the market frame), second, the focus on creativity, which can be transmitted when personality is embedded in intangibles like ‘celebrity’ or ‘brand’, or other products, and, finally, the quality conventions of opinion (subjective judgment as well as public reception) that are more easily portable along the chain but “they are typically more contested and localized than market or quality conventions” (Ponte & Sturgeon, 2014, pp. 208–210). Regarding creativity—the key ingredient of CVCs—the ‘conventions school’ offers a framework to understand the social character of the economy arising from the need for creative input, as products (aesthetic and technological) are not easily separable from the persons giving rise to them and therefore personal connection and embedding of personality in products is fundamental to qualification processes in CVCs and parts of GVC working with creatives. It also emerges from this approach that around creativity (as core demand and supply) a ‘multipolar’ chain forms that is “different from ‘markets’ as they are shaped by the explicit strategic actions of powerful actors (both and outside the chain), even if they exhibit multiple foci of power various kinds of linkages” (Ponte & Sturgeon, 2014, pp. 215–216). Lead firms struggle to define and manage quality (Gibbon & Ponte, 2005). The discussion appears to suggest three ‘economies’ for such multipolar chains: creative industries, knowledge economy, and the nonprofit–for-profit mixed economy (Gereffi et  al., 2001; Lounsbury et al., 2003).

Rent and Value A parallel effort to  conceptualize power, seen in Kaplinsky and others’ works (see Havice & Pickles, 2021), has been to understand power as a medium that confers the ability to extract ‘excess profit’. Rent “describes

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a situation where the parties who control a particular set of resources are able to gain from scarcity by insulating themselves from competition”, a state “achieved by taking advantage of or by creating barriers to the entry of competitors” (Kaplinsky, 2021, p. 153). Research interest and civil society concern over ‘rent-seeking’ has grown with the allocative power of governments and large corporations, which incentivizes people they employ to exploit their privileged access to resources or take bribes to assign this to others (Milanovic, 2019; Christophers, 2022). While still being treated by Adam Smith (1776) as legitimate income enjoyed by landowners, rent has since David Ricardo (1821) been viewed more critically, as the undeserved excess income captured by those who control some kind of scarce resource (or, become gatekeepers and make abundance scarce) (cf. Beblawi, 1987). The rent approach by Kaplinsky critically claims that analytics rather than heuristics are necessary to overcome the tendency in GVC analysis to focus on specialization in firm networks, and with respect to GVC’s more critical edge of writing on capitalism that sustainable income growth research must involve actors’ identification of areas of value accretion that have been relatively protected from competition. Almost every sector has individuals and firms that receive economic rent—income exceeding the minimum that would keep them in their current line of work. The familiar explanation is that rent is available to those with exclusive access to a scarce resource. Classic examples are agricultural rents, received by the owners of the best farmland, who can price their products as high as those from ‘marginal’ land while their unit costs are much lower; and monopoly rents, conferred temporarily as a reward and incentive for innovation. In arguing that “the origins and drivers of GVCs are understood through the lens of rent generation, rent protection and rent appropriation”, Kaplinsky (2021) identifies four distinct types of rent: Natural rent—value accruing to owners of higher-quality natural resources (including land, energy, and mineral deposits), who charge the same price as higher-cost competitors while their production costs are lower. Endogenous rent—a temporary excess profit received by producers who achieve a cost reduction via process innovation or have a market to themselves due to product innovation, which will be eroded by competition as others adopt the innovation (also called producer-rent, innovation-­rent, or quasi-rent).

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Exogenous rent—additional profit conferred on all producers in an industry via external action that reduces their costs (e.g., arising from public infrastructure investment or an industry set up a new training scheme, or financial sector innovations reducing small firms’ finance costs, and national innovation systems. Clusters (see Chap. 6) can lead to external rents. Market rent—an excess profit due to scarcity, conferred artificially on one or a few producers (e.g., monopoly position granted to first-mover firms or industry champions, trade protection for specific sectors like the film industry). Among all rents, which describe different ways of conferral of a ‘monopolistic edge’, all except for the innovation rent are of long-term nature, well-residing in a “neo-liberal world where competitive markets are supposedly dominant” (Harvey, 2001, p.  397) and where political regime changes are relatively infrequent. They are of the kind for which would-be monopolists unproductively compete. Contradicting the competition ideology of free-marketeers, market rent arises from the power to raise prices while barring entry to rival producers, rather than the achievement of lower costs that secures a profit while higher-cost rivals just break even. These four rents, identified in GVCs, can also be observed in CVCs. Ahead of illustrating this in Chap. 6, we point out that the spectrum of rent in media value chains includes normal economic policy instruments such as film quota, protected markets and restricted price competition, subsidization and tax incentives, extensive ownership protection, SME support in the film and audiovisual sector, and legal and financial provisions furthering formal and informal skilling (Ulff-Moller, 2003; Wasko, 2007; Yecies, 2007; Towse, 2008; Susan Christopherson & Rightor, 2010; Meloni et  al., 2015; Vogel, 2023; Talavera Milla et  al., 2016; Hemels & Goto, 2018; McKenzie, 2022). The picture rendered by adding rent to power in inter-firm relations moves value chain analysis beyond inter-firm network analysis, as the four pathways for rent capture are distinct but not mutually independent in light of actors’ environmental embeddedness of firm networks (Kaplinsky, 2021). For example, endogenous rent opportunities can be a function of exogenous rent provision; through social influence (e.g., the lobbying of state actors across the band of executive, legislative, and juridical administration), actors in economic settings can shape that function while not being fully in control. Similarly, market-rent opportunities are normal as

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large firms typically have core competencies to monitor regulatory systems, consult on industrial development plans, and bid for being ‘industrial champions’ (Falck & Heblich, 2007; Belova et al., 2023). There also are start-up rents comparable to the Ricardo type of ‘gifts of nature’, given in exchange for producing innovations, which in turn invite them to draw on endogenous rents associated with markets (first-mover advantages being bargained over with technocratic elites), and drawing on publicly paid higher-education resources within legitimate structures of national innovation systems (Mazzucato, 2019). To public choice economists, exogenous rents are pure market distortion hampering market competition and creating ‘moral hazard’ (Munger, 2019; Tullock, 1967) and, in Solow’s words, a return to the special location of firms in the economy, rather than a return earned by labor or capital (cited in Sękowski, 2021). More recent research has moved rents as antidemocratic practices back on stage of heterodox economic inquiry (Lindemann, 2021).

Conclusion This chapter charted basic features of value chain analysis and recent debates that show engagement with the changing reality of the world economy in social development (Mahutga & Smith, 2011; Teipen, 2019). GVC research has sparked interest in identifying the drivers of persisting inequalities, uneveness in ‘social upgrading’ and exclusion of actors from chains (e.g., Bair & Gereffi, 2003; Werner & Bair, 2021). There is confluence between scholars interested in qualification (Ponte, 2009) and labor researchers (Bair et  al., 2016), which provide a potential opening for engagement with economic sociology grappling with valuation (Ponte & Daviron, 2011). Firm-network and production-networks analysis also more recently focused on local and regional processes and the economic potential of clusters (Lingo & O’Mahony, 2010; Di Maria et al., 2021; De Marchi et al., 2018), opening up potential for understanding the specific nonmarket organizations and institutions typical of art and culture, while needing specification of analysis with creative and cultural labor inputs. Still, little has been done to study cultural occupations in their locations and value-capturing potentials in the global economy. We assess positively that the GVC framework has been refreshed with political-economy concepts resonating with the spirit of the initial GCC framework, while going beyond it with conceptual developments of governance, power, and rent to determine profit-making, rent-seeking, and

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labor-exploiting scenarios in value chains, with analysis incorporating the ‘true’ actor set (Ponte & Sturgeon, 2014). Single case studies of social movements (e.g., Nickow, 2015) point to the need for more systematic engagement with nonprofit contributions to industrial value chain dynamics (Lounsbury et  al., 2003). The little attention paid to such actors is surprising given the interest in profit-driven enterprises—especially after the ‘shareholder value’ movement from the late 1990s (Do Carmo et al., 2023)—in eroding those parts of GVCs that they do not control, so as to capture value from them. Value capture is made easier when the chain contains participants that do not seek to maximize profits, or even must not make any. Another critique—from inside the GVC scholarship—has been the neglect of law (IGLP, 2016). While GVC analysts tend to focus on the workforce, we see the intense expansion of cultural production in its relation to organizational formats, conventions, and legal frameworks—approaching the nonprofit value-­ adding by understanding that artists producing at low cost require an organizational format. With GVC analysts having identified the diversity of configurations, and specific dynamics such as in relational governance, or the various diffuse power types operating on the elements of chains and their environments, we can move toward formulating a cultural value-­ specific approach.

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CHAPTER 3

Introducing the Special Dynamics of the Culture Value Chain

Abstract  This chapter examines the way that cultural products are made and traded in cultural value chains (CVCs) and enter other value chains, highlighting the differences between CVCs and the production processes that are the focus of current global value chain (GVC) analysis. The location of value-added processes along the chain stands in particularly sharp contrast. In a typical GVC, rents are extracted at the first and final stages of the chain, with the middle stages being outsourced (and often offshored) to lower-cost suppliers, giving value-added the typical Smile Curve shape. A typical CVC flattens or even inverts this smile shape, with cost-saving efforts mostly directed at the beginning and end of the chain because artists and creatives are inherent to the production activity in the middle. Artists provide and perform singularities around which value chains can emerge. This chapter tackles the common binary of art versus economics by viewing cultural value as a type or component of economic value and by demonstrating how the eventive art form can be analyzed with the economic concepts of ‘stock’ and ‘flow’. This approach also proves useful in understanding the emergence, enabled by the Internet and artificial intelligence and accelerated by the 2019–22 pandemic, of ‘hybrid’ cultural activities that intermix ‘live’ and transmitted performance within one CVC. Keywords  Smile Curve • Scowl Curve • Cultural value • Value network • Singularity © The Author(s), under exclusive license to Springer Nature Switzerland AG 2023 A. Vogel, A. Shipman, Film Festivals and the Enrichment Economy, https://doi.org/10.1007/978-3-031-33501-3_3

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We begin by clarifying the differences between manufacturing and nonmanufacturing value chains, which leads us to taking a closer look at the industry classification used in product identification and five propositions of how and why global value chains (GVCs) and cultural value chains (CVCs) are different. Shaping the CVC framework of analysis we then provide a way of defining cultural product that from our point of view serves better in valuation heuristics and chain analysis. Our distinction between ‘creative art’ and ‘cultural performance’ addresses the necessity of a new principle of economic-value modeling in which the common binary between cultural (social) value and economic value (Throsby, 2003) is suspended. We provide an alternative by integrating these two types of value as we treat ‘cultural value’ as an input to an ‘enriching’ process (see Chap. 4) supplied by experts (such as critics and curators, etc.) who may raise or lower an item’s economic value through their authority to  confer valorization on  such goods and services (Seaman, 2006). We discuss the creative and performance types of art and culture in detail, demonstrating how the eventive art form can be made sense of in economics’ terms of ‘stock’ and ‘flow’.

The Smile Curve and the Scowl Curve The GVC framework is largely based on what Boltanski and Esquerre (2020, pp. 135–151) call the ‘standard form’. This type of valuation principle (one of four, which will be discussed in Chap. 4 in more detail) operates where the manufacture of things takes center-stage: mass production of standardized goods and services enables their sale in competitive markets, though suppliers try to differentiate their offers and segment their markets to reduce competition and achieve some price-setting power. The logic of this price-setting mechanism is assumed regardless of what is produced, traded, and consumed. Prices are set at each stage of the value chain—for raw materials, intermediate inputs, and final products for wholesale and retail; ‘value added’ is identified as the price difference between items bought at the start of the stage and items sold at the end. Some of these output prices and input costs are visible on open markets for the standardized items, while others may have to be inferred from information on internal transfers within transnational firms. Studies of manufacturing and services industries’ value chains has confirmed a widespread ‘Smile Curve’ pattern which plots stages of production on the horizontal axis against value-added on the vertical axis, with the result of a pronounced dip in the middle (Aggarwal, 2017; Meng

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et al., 2020). The Smile Curve demonstrates that realized value-added is concentrated in the pre-production stages (design, product development, sophisticated components, logistics for moving these between production sites) and post-production stages (distribution, marketing, after-sales service). Suppliers at these pre- and post-production stages often hold intellectual property (IP) rights enabling them to set prices high above their costs, and to specialize in these higher-value-added activities. The intervening stages, in which physical parts are made and assembled, are liable to be outsourced so as to lower the cost of procuring them, a process that is helped by ease of entry and intense competition among suppliers in GVCs that forces their costs and margins down. Cost reduction in the middle part of the Smile Curve tends to have three components: first, efficiency gain, from employing specialist suppliers who bring task-specific skills and aggregate work to spread overhead costs; second, low-wage gain, from employing workers in lower-cost locations whose relative wage is further below the home-country level than their relative productivity; and, third, price-setting power, pushing purchase price down toward production cost through the exploitation of monopsony and of strong competition among suppliers. Digitally enhanced automation has widened the scope for outsourcing some professional administrative tasks, as well as production and assembly, to lower-cost locations (Blinder, 2006). This increases the importance in GVCs of ‘creative’ skills, not yet replicable by computers or artificial intelligence (AI). The need for creative thinking, and the education associated with it, has to date kept most professional work in highercost locations, shielding the ‘white collar’ workforce from substitution by Global-South counterparts or machines. Yet, with AI  on the rise, the Smile Curve is expected to become less representative of knowledge-economic chains, segments, or value chain networks, as the higher valueadded at the start and end of the chain begins to erode. A different pattern of value creation and realization is already observable in cultural production, for which the ‘Scowl Curve’ is a better model fit, especially more powerful in its application to a rapidly digitizing economy that challenges ‘industrial thinking’. Cultural outputs account for many of the value-additions that turn industrial Smile Curves upward at their two ends. But the curve for CVCs is more often an inversion of this, with value-added staying low at the raw input and final distribution stages and rising in the middle where material and performance elements are creatively mixed. This is because cultural

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production is often ascribed to the agency of the producer who generates art (through craft, composition, and performance) and is recognized as an artist when people appreciate or purchase the art. Bourdieu influentially reverses this explanation by arguing that cultural production is a field that structurally creates the position of the artist, whose output then—as a result of this positioning—becomes a cultural product. He presents the process of positioning as a combination of social and family background (which confer status and specific types of social capital) and concurrent social action, such as the receipt of approval from critics, sponsors and already-established artists (Bourdieu, 1993, p. 164). Cultural products are not primarily valued for achieving any practical task, or fulfilling any essential need. Arguments that art is a form of knowledge succeed only by stretching the definition of knowledge, beyond the realm that easily converts into monetary value, toward anything that has a cognitive impact (Young, 2001), and numerous counterarguments reassert the inherent uselessness of art (Tallis, 1995). The subjective definition of art, as anything that art-world members (audiences, critics, sponsors, other artists) collectively agree to treat as such (Becker, 1982), is reaffirmed when art exhibitions give space to materials manufactured for a different purpose (such as Marcel Duchamp’s ‘Fountain’ urinal) or thrown away as waste (as in Sarah Lucas’s ‘found’ objects). Although the valuation of many outputs from other industries (e.g., souvenirs with no useful or decorative function, or dietary supplements with no proven nutritional effect) can appear equally subjective, these tend to disappear from the market if consumers do not perceive some value in them. The art world, in contrast, contains many stakeholders other than consumers with the power to confer or withdraw artistic status, regardless of the ‘voting classes’ of consumers. In section “Cultural Value Chains: Deviating from Standard Form”, we outline further distinctions with other consumer goods.

Cultural Value Chains: Deviating from Standard Form Value chains are conventionally conceptualized around the product that emerges from them, with standards and economic measurement of ‘elasticity of substitution’ helping to distinguish them from other products. With cultural production we more often need an analytic distinction that

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can define the value chain location and connected capabilities, value creation, and rent potentialities. Cultural production is conventionally traced to specific sectors labeled creative (Greater London Authority, 2019). A meta-review study (Tom Fleming Creative Consultancy, 2015) found significant evidence in Europe of ‘knowledge spillovers’, through which the creative sectors promote innovation in other sectors, enhance skills and employability, and strengthen social relationships both within and across national borders. This opens the way for economic analysis of different cultural industries’ employment, value-added and trade contributions, the interlinkages between them, and resultant effects of expanding or contracting different activities through changes in public or private investment. Yet, there are overlaps across areas of cultural production (Hesmondhalgh, 2007, pp.  12–13), and convergences with industries outside the classification of ‘cultural’. The Internet has enhanced these overlaps and convergences as (among other branches) broadcasting, music distribution, advertising, and computer gaming industries migrate onto it. This highlights the way that all kinds of activities can now be mediatized, with common channels making some more interchangeable and substitutable for others at both the consumer and producer end. The professional version provides entertainment content for live performance or broadcasting, while amateur participation constitutes nonprofit activity similar in some ways to that in museums, galleries, and libraries. In the course of the improvement of Internet technology many cultural activities have developed into hybrid forms. This intermixing of chains and networks in cultural production is evident in the very different schematizations proposed by leading commentators on it, summarized in the following table (Table 3.1). The industrial classification by DCMS remains the standard framework, treating the cultural industries uniformly and integrating with the inter-­ industry input–output data that the same statistical services compile. Throsby’s Concentric Circles model, with its emphasis on creativity as cultural products’ distinctive input, ascribes centrality to creative and performing arts that the others leave at the periphery, while relegating such products as film, TV, and advertising as core. Hesmondhalgh’s Symbolic Texts model, focusing on social rather than economic impact, has some overlap with Throsby’s Concentric Circles but omits at least two industries (fashion and software) that are economically large, on the basis they do less to shape ‘social meaning’. The Copyright model by the WIPO, putting protectable IP rights at the center, depicts a production process built

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Table 3.1  Classifications of cultural industries Approach & main authors

What is viewed as central

Core activities/elements Peripheral activities/ elements

Industrial classification (DCMS)

Nothing – all can be core

Concentric circles (Throsby, 2008)

Outputs that require a creative input and are ascribed cultural as well as economic value Media industries that directly create social meaning Sources of intellectual property that allow trading of product at market price

Film, video, TV, radio, music, software, games, design/fashion, publishing, art, crafts, architecture, performing arts, advertising (Inner) Literature, music, visual arts, performing arts (Outer) Museums, libraries, film

Symbolic texts (Hesmondhalgh, 2007) Copyright (World Intellectual Property Organization [WIPO, 2017])

Wider: TV, radio, recorded music, games, publishing, heritage Related: Design/ fashion, advertising Film, music, TV, radio, Creative arts, fashion, games, publishing, software advertising, internet Film, video, TV, radio, music, publishing, advertising, software, visual and graphic arts

Partial copyright: Design/fashion, architecture Interdependent: Musical instruments, photographic equipment, electronics

Adapted from Flew (2013)

around economic value. These classifications and the sources of value they indicate help to identify the main differences between CVCs and GVCs that characterize other industries, which we now propose. First, CVCs tend to retain work in the high-income countries (‘global North’, (Jackson et al., 2016)). GVCs typically outsource and offshore, to lower-cost locations, the factory-based work of main component production and assembly. CVCs are different because the most creative elements in cultural production are inseparable from the artists who engage in it, who tend to be located in the global North or higher-cost locations in the ‘global South’, and from arts-related support workers who cluster around those artists. This is reinforced by the tendency for the audiences that pay

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most, and the curators and critics who exercise most influence, to be located in the same high-income areas. Where any parts of a CVC can be ‘offshored’, these are generally activities that precede or follow the creative process —for example, editing manuscripts or recordings, making and mixing paints, basic coding for software products. Hence, we propose the Scowl Curve for better modeling representation. Second, many trade barriers on cultural products have been retained (Goff, 2019) in contrast to the reduction of trade barriers on manufactured goods (and business services) that has promoted the globalization of their value chains. Multilateral free trade pacts (such as of the WTO and the European Union) explicitly retain national governments’ right to restrict the cross-border movement of cultural artifacts and of artists for performance purposes, which contributes to the different pattern of global outsourcing, and the importance of the collaborative, often asymmetrical mode of ‘co-production’ that has been bolstered by trade negotiations on culture as both specific (to location) and diverse (Yan & Yu, 2021; Parc & LaFever, 2021). The range of nontrading actors in a CVC cannot be simply added to the actor set but has to be analyzed in terms of their specific conditions and types of intermediation. Third, each final output from a CVC is different, departing from the standardized process and standardized product of manufacturing and service GVCs. Each CVC is set up to deliver a specific project–one film, one run of a play, one concert series, etc. (Caves, 2000). The aim is to produce a ‘singularity’ (Karpik, 2010), even if some parts of a successful CVC are later retained and re-versioned for other projects. Cultural production revolves around time–space compressed project work, where efficiency is gained by standardizing project management. This amplifies (compared to most GVCs) the role of temporary organizations and ‘pop-up’ venues, staffed by temporary contractors and volunteers. Fourth, CVCs tend to be less linear than the GVCs in classical research, in terms of sequential and geographically separable stages. Some participants, such as creative artists and writers, curators, event organizers, publicists, make recurring contributions throughout the production process, either as the center of a network or as key connectors between networks. Their interactions may be essential for a project’s creative success, and often continue in the intervals between projects, leading to clusters and cyclical flows within the chain (Coe, 2000). The ‘value network’, now often identified around the key value-adding stages of the GVC, is an important feature of most CVCs. In keeping with its value-added pattern

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being an inversion of the Smile Curve, the appropriate metaphor for cultural production seems closer to a flowering plant than a chain. Its roots are in low-value soil, its visible outputs are the flowers at the top, but the source of their value is in the creative processes that lie between, so both the roots and the petals quickly wilt if they are stretched too far from the stems, or if these are not well maintained. Fifth, whereas GVCs enhance value by delivering standardized products, with manufacturers’ and service brands deriving their premium from predictable quality, price and experience (Keller, 2000), the value of cultural goods can be enhanced by novelty and excitement. Eventfulness, rather than regularity, forms the dynamic of cultural production, and CVCs feature, and are increasingly designed around, events that insert surprise and disruption into processes that otherwise tend toward industrial regularity (Hutter, 2011). Finally, whereas in most GVCs there is a clear distinction between objects and events, allowing separate identification of product from process on the supply side and of consumer goods from consumer experiences on the demand side, CVCs blur this distinction as they seek to add value by shifting experience from objects to events. This leads us to redefine the concept of the cultural product.

(Re-)defining Cultural Products Faulkner and Runde (2019) fundamentally distinguish between objects (subdivided into syntactic objects and digital objects) and events. ‘Objects’ are entities with durability and structure, composed of parts and an arrangement (configuration of the parts), both of which endure through time. Within this category, the ‘syntactic object’ is a nonmaterial object in which the durable parts are symbols, and the structure provided by “syntactical and semantic rules of the language in which they are couched” (Faulkner & Runde, 2019, p. 1284). ‘Digital objects’ are those that are nonmaterially coded into digital form (as bitstrings) but typically carried by (after translation onto) a material bearer such as a storage card. Sociology treats objects as explicit or public parts of culture which stabilize or at least canalize human action. Objects carry, as they insist, ‘potential’ meaning. Wendy Griswold defines objects as “shared significance in form”, the sharing making things cultural (cited in Mohr et al., 2020, p. 62). Form is ‘material instantiation in the world’, which can be extended to digital media. Performances can be ‘preserved’ in different ways (Mohr et al., 2020, pp. 61–62).

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In contrast to objects, ‘events’ are entities whose constituent parts (and configuration of those parts) appear at different times and/or do not persist through time. Although this distinction is consonant with the convention for the study of cultural objects (Mohr et al., 2020), this typology developed in the digital business world appears much less distinct in the cultural world. Things like plays, novels, and musical compositions might be regarded as ‘syntactic objects’ that are increasingly distributed as ‘digital objects’. But each staging of the play, reading of the novel, or performance of the musical composition can become an event, made unique by inputs and interpretations supplied by the audience as well as by the performers. Objects can also become installations (Gutschow, 2006), that is, object-networks that are performed (see Chap. 5 on performativity). And although ‘events’ are designed to be one-off configurations of constituent parts, thus singularities in their own right and never to interact with one another or with their audiences in the same way again, an event can take on some of the structural aspects associated with an ‘object’—such as a regular place in the calendar, and repeated appearances of the same artists or productions. Cultural objects appear to be not wholly separate from events because, unlike other types of object including digital objects, they have no inherent characteristics that give them this status. Their recognition as cultural objects is contingent on conferral of this status by audiences, curators, and other art-world players, the work of art only existing “by virtue of the (collective) belief which knows and acknowledges it as a work of art” (Bourdieu, 1993, p. 35). The conferral of an art-object status attains the nature of an event, with artworks and their creators bursting onto the scene—‘making a big splash’—and subsequently fading from it, or enjoying recurrent waves of popularity. To account for the temporal character of the cultural product, with its elision of object and event we make the following distinction. Creative Art This type of artwork is separable from the creator and can exist independently, existing as such but also potentially having an ‘aura’ when far removed from them in time and space. This separability means that they can legitimately exist (as art) independently of further interpretation. Many artworks gain renewed currency as changed times inspire new interpretations, despite the ‘historicist’ demand that they be viewed in their

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original context. Examples are paintings, sculptures, studio recordings, feature films, filmed concerts, novels, and picture books. Scripts and musical scores can also take this form, to the extent that a reader may study these and enjoy them. The durability of completed artwork means that artists tend to add to individual or collective archives, by continually delivering new styles or new works within a style. ‘Creative art’ tends to be associated with galleries and exhibitions, where products are put on display for the public audiences, private art collectors, and critics to interpret and appreciate. These observations support the view that ‘creative art’ tends to resonate with processes of the ‘collection form’ (Boltanski & Esquerre, 2016). Cultural Performance This term—based on performativity theory (Fischer-Lichte, 2021)—covers all the artwork that starts with a design set down by a creator (as, e.g., a musical composition, choreography, blueprint, or script) but depends on performers for its full expression and appreciation. Examples are everything ‘live’, including theater, dance, music, comedy, and poetry readings. The performers are usually human, though ‘cultural objects’, programmable machinery, and audiovisual effects may also be part of what appears on stage. Performers are hired to give the best delivery or representation of an original artist’s work, but are expected to bring some creativity to their interpretation. So although they perform to an earlier script or design, the performance is always unique. It is the performers who bring the work alive for the audience, so they are also classified as artists. Artists may, in their lifetime, also be performers, but many are not, staying behind the scenes. ‘Cultural performance’ occurs in particular aesthetic forms of sociality (de la Fuente, 2008), for example, theaters and concert halls with a public and critics as audiences to interpret and appreciate. These observations support the view that ‘cultural performance’ tends to resonate with processes of the ‘trend form’ (see Chap. 4). While the two types of art appear analogous (respectively) to other industries’ goods and services (such as of ‘standard form’), the analogy is weakened because art objects are often unique or only made in small batches, in contrast to the typical manufactured good which is mass-­ produced. Conversely, performances can increasingly be replicated across space via audiovisual transmissions of rising quality, and across space through the mass-production of recordings without loss of quality. The

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separate but interconnected creative art/cultural performance distinction is therefore preferred to the more mutually exclusive good/service distinction—and to recent efforts to distinguish between ‘object’ and ‘event’ in the digital sphere (Faulkner & Runde, 2019). The creative/performing art distinction underscores that cultural production takes the form of physical objects that last through time, and of performances which last only as long as the performers are on stage, demanding more focus on the event format of cultural production and its importance in the division of labor as immersive curation. Cultural production, in the form of live performance, can be regarded as the delivery of pure ‘experience’, from which the customer emerges with memories and ‘buzz’ but no physical artifact (except perhaps for merchandise acquired at the event which may serve as a memento). However, cultural products may also take a physical form—visual artwork, or sound and vision distilled into recordings that the customer can display and replay in their own time. Additionally, digital innovations have recently dematerialized some of these products, for example, replacing physical disks and tapes with downloaded or streamed recordings, and substituting non-fungible tokens (NFTs) for physically owned visual artworks.

Stock of Capital and Flow of Product Because manufactured and service products flow from a stock of physical and human capital, cultural economists conventionally theorize that cultural products flow from a stock of creative capital (some sort of talent) (cf. Throsby, 1999). The economic metaphor highlights the two-stage nature of cultural production, comparable to the division of manufactured items into ‘capital goods’ and ‘consumer goods’, leading to the following assumptions. First, there is a flow of cultural artifacts—artwork, recordings, designs, craft products, etc.—generated by artists’ stock of capital, which includes their own (human) capital, the specialist tools, instruments, and materials they acquire, and the specialist venues they work in. This production-side stock might be termed ‘creative capital equipment’. Second, these artifacts tend to form a stock of durable creative capital, which generates the flow of cultural experiences that spectators may enjoy. This consumer-facing capital stock, part of the enduring final product of artistic endeavor, might be distinguished as ‘creative capital goods and services’‘ ‘Creative capital’ is a factor of production that is separable from individuals, which needs to

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be distinguished from Bourdieu’s cultural capital (which seems to be held by individuals, as embodied), and social capital that exists in the network connections between people (Bourdieu, 1986). Cultural capital as used by Throsby (1999) is an encompassing term that we do not specifically use, as it could reside in networks between individuals and/or within organizations and enter production as raw or intermediate input. Creative capital goods include fine visual art, architecturally distinguished buildings, sculptures, landscapes, and other backdrops that are used to shoot films (and may subsequently become tourist attractions), master tapes from which recordings may be made (on a succession of media), and classic music compositions that are sampled to make other recordings. Distinguished artistic spaces such as concert halls and cinemas, initially designed as ‘creative capital equipment’ to facilitate the process of delivering aesthetic experiences, may also become part of the ‘creative capital goods’ stock when they become objects of interest in themselves, attracting visits and producing valuable experiences even when no performances are being staged there (as suggested with the Beijing stadium). As with the capital used in other industries, ‘creative capital’ also has ‘intangible’ forms that appear to be of rising importance. With access to most tangible capital equipment (word processors, cameras, recording equipment, broadcast or narrow cast channels, etc.) becoming cheaper and more generally available, the decisive source of value shifts toward the stock of intangible creative capital—including artists’ training, social network connections, and reputation with audiences and the intermediaries who channel their work. To make the connection to Bourdieu’s cultural capital, it is increasingly harder for social-mobility aspirants to draw on creative capital as boundary objects for status enhancement due to the open character of ‘culture’. Hence social capital, which may mobilize value, especially when connected to events has gained track as the new mode of conspicuous consumption, which competes, but can be combined, with social media, a digital event form. There is a within-distinction in creative capital, as there is the capital equipment that creative people work with (tangibles like video and recording equipment, intangibles like artistic knowledge and software) and the creative outputs that become durable assets, yielding a stream of value and income over time, like the stock of artwork that creates income for a gallery, or a historical building that generates tourism. These two forms behave in different ways, and their difference from capital forms elsewhere in the economy sheds new light on ways in which cultural production

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differs from production of other commodities or services: disproportional speed of depreciation, pricing dilemmas, grants dependency and commons as tactic to fix problems—all leading up to ‘excess supply’ in art and culture reproducing the following patterns. Second,  successful artists die and their instruments wear out long before their finished artwork decays or becomes obsolete. Artistic production spaces need costly upkeep, especially when they combine the role of artwork and commercial building. In contrast, visual art, music compositions, poems, and buildings from centuries ago are still with us, and a whole industry is now assigned to preserving them in perpetuity. In sum, capital going into artifact production depreciates much faster than the artifacts themselves. Second, the flow of experience from cultural artifacts is often unpriced, or even unpriceable. Whereas artwork is costly to produce, spectators often can—and may expect to—gain from experiencing it free of charge as in the case of much public arts and free access to cultural institutions (Scitovsky, 1972). Cultural experience thus resembles information in being costly to produce and easy to reproduce, having public goods character unless its consumption can be limited to paying consumers. Third, elsewhere in the economy, producers’ inability to recover the costs of their activity from users is expected to lead to public goods being under-produced (DiMaggio, 2006). This may not be a ‘general law’ for all art and culture, as those who wish to reach their audience (or make ‘art for art’s sake) will continue to produce even if consumers do not pay (Wherry, 2008). This provides a unique way of value capture from artistry, with the nonprofit way of value capture only illustrating one complex way of patronage in the arts, underlining the mixed-economy character of cultural production. Whereas most industrial products are consumed immediately, and even ‘consumer durables’ become worn out or obsolete after a few years, physical artwork (and recordings of performances) are now extensively preserved, so back-catalogues and archives keep growing. This amplifies the importance of Boltanski and Esquerre’s fourth valuation principle, the ‘asset form’, for valuation analysis of CVCs alongside the ‘trend’, ‘collection’, and ‘standard form’.

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The Scowl Curve: Concluding Remarks In this chapter, we inspected cultural products that are made and traded in CVCs and enter other value chains. We  highlighted the differences between CVCs and the manufacturing processes that have been the focus of GVC analysis. Our new approach leads to a reformulation for cultural production that gives a firmer basis for understanding value-added, and artistic rent, which are analyzed in the chapters that follow. We still need to emphasize both a commonality with GVCs and a difference to knowledge-­economic value chains. The emergence of ‘pure’ experience-focused production, with firms and workers engaged solely in cultural production, occurs alongside the addition of ‘experience’ as a source of value-added in agricultural, manufacturing, and service production. An experiential element is added, for example, to consumption of agricultural products when highly flavored food is consumed in a restaurant; of manufactured products when a sports car offers the driver and passengers ‘look and feel’; and to a nonmarket service when a public hospital starts to consider its patients’ psychological ‘wellness’ in addition to their objective physical health status (e.g., Biehl, 2021). Many studies focus on symbolic value but understate the experience value from ‘aesthetic mobilization’ (Reckwitz, 2017b), which we stress with our redefinition of cultural product. Scientific knowledge has traditionally been treated as a good from which everyone benefits (even if only a minority receives it) and that everyone deserves, so that no-one should be excluded. How does cultural production differ from science production? Over the past half-century, existing and newly produced knowledge has been subject to an increasing degree of asserting private property rights over it, and charges imposed for accessing it (Towse, 2008). This knowledge ‘enclosure movement’ has been fueled by a number of factors, mainly electronic storage and paywalls, neoliberal financial policy complicating subsidization, the privatization of data collection by governments and IP-regime expansion, restricting its availability to researchers without access fees, and the desire of knowledge producers to extract full economic value from their achievements like discovery or invention (Pagano, 2014; Durand & Rikap, 2021). This tendency toward enclosure has been met by countermovements of creating forms of ‘commons’, such as the European Union’s Open Access initiative for academic publications, which concentrated media groups have consequently aimed to resist (Kranich, 2007; Resnick & Belluz, 2019).

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‘Creative economy’ commentary (see Coyle, 1999; Florida, 2019; Leadbeater, 2000; Stewart, 1997) converges with that on the ‘knowledge economy’, since creativity (as primary input) and culture (as preserved output that can reenter the chain as intermediate input) shares many characteristics with technological and organizational knowledge. Creativity can be viewed as a type of ‘intellectual capital’, entering production alongside other capitals (fixed, financial) and labor; or as a flow of intellectual input that gets used up in production and/or embodied in the ‘cultural product’ that flows out. The treatment of creativity as capital runs into a problem of measuring heterogeneous nonfinancial capital, which requires knowledge of a discount rate that cannot precede the calculation (Cohen & Harcourt, 2003). Conceptual problems in ‘capital theory’ have steered economists away from the production side and toward the market as the appropriate place to measure value, and to identify where it has been added along the production chain. But artists in the early or later stages of their careers, and the many who play supporting behind-the-scenes roles, lack power, being unable to capture their full share. This allows rent extraction in the middle stage evident in an interlaced dynamic where artists produce at low cost, audiences pay high ticket prices, and intermediaries capture the resulting rents. Widely quoted data showing the average UK author earning £16,100 in 2018, down 49% over the preceding 12 years (Kretschmer et al., 2019), and the average visual artist receiving just over £6000 from their art (Arts Council England, 2018), highlight the extent to which a determination to work creatively regardless of financial reward keeps baseline pay down even in a fast-growing cultural economy. It also affirms the disconnection between sector level value-added and individual creative pay, as income is channeled to intervening points in the chain. In conclusion, the distinction between GVC and CVC concepts must be observed as argued with the Smile Curve. To recall, in the Smile Curve rents are extracted at the first stages and the final stages because the middle stages are outsourced and offshored. There is a big difference to the CVCs in which artists and creatives are inherent to the product definition, or put differently, provide and perform singularities around which value chains can emerge. The Smile Curve is replaced by a ‘lopsided smile’, or possibly a ‘scowl’, partially or wholly inverting the familiar smiling shape. That is because in the arts, value is still mainly added during the production stages, which are when premium-paying audiences experience the creative act at first-hand. Efforts to cut costs, and drive remuneration

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down toward costs, tend to be focused on the pre-production stages but also in the post-production stages. Where value-added rises, in the middle of the curve, some artists are able to capture their ‘fair’ share of it, by using their star power to bargain over payment.

Bibliography Aggarwal, S. (2017) Smile curve and its linkages with global value chains. MPRA Paper No 79324, 14 May, online at https://mpra.ub.uni-muenchen.de/79324/ Arts Council England. (2018). Livelihoods of visual artists report. Arts Council England. Becker, H. S. (1982). Art worlds. University of California Press. Biehl, B. (2021). Luxury in Germany: Sick cars and healthy bodies. Society, 58(5), 385–391. https://doi.org/10.1007/s12115-­021-­00610-­x Blinder, A. S. (2006). Offshoring: The next industrial revolution? Foreign Affairs, 85(2), 113–128. https://doi.org/10.2307/20031915 Boltanski, L., & Esquerre, A. (2016). The economic life of things: Commodities, collectibles, assets. New Left Review, 98, 31–54. Boltanski, L., & Esquerre, A. (2020). Enrichment: A critique of commodities. Polity Press. Bourdieu, P. (1986). The forms of capital. In J. G. Richardson (Ed.), Handbook of theory and research for the sociology of education (pp. 241–258). Greenwood Press. Bourdieu, P. (1993). The field of cultural production. Polity. Caves, R.  E. (2000). Creative industries: Contracts between art and commerce. Harvard University Press. Coe, N. M. (2000). The view from out West: Embeddedness, inter-personal relations and the development of an indigenous film industry in Vancouver. Geoforum, 31(4), 391–407. https://doi.org/10.1016/S0016-­7185(00)00005-­1 Cohen, A., & Harcourt, G. (2003). Whatever happened to tthe Cambridge capital theory controversies? Joiurnal of Economic Perspectives, 17(1) 199–214. Coyle, D. (1999). The weightless world. MIT Press. de la Fuente, E. (2008). The art of social forms and the social forms of art: The sociology-aesthetics nexus in Georg Simmel’s thought. Sociological Theory, 26(4), 344–362. https://doi.org/10.1111/j.1467-­9558.2008.00333.x DiMaggio, P. J. (2006). Nonprofit organizations and the intersectoral division of labor in the arts. In W. W. Powell & R. Steinberg (Eds.), The nonprofit sector: A research handbook (pp. 432–461). Yale University Press. Durand, C., & Rikap, C. (2021, October 5). Intellectual monopoly capitalism – challenge of our times. Faulkner, P., & Runde, J. (2019). Theorizing the digital object. MIS Quarterly, 43(4), 1279–1302. https://doi.org/10.25300/MISQ/2019/13136

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Fischer-Lichte, E. (2021). Performativität: eine kulturwissenschaftliche Einführung. transcript. Flew, T. (2013). Global creative industries. Polity. Florida, R. L. (2019). The rise of the creative class (Updated ed.). Basic Books. Goff, P. M. (2019). Trade and culture: The ongoing debate. International Journal of Cultural Policy, 25(5), 547–551. https://doi.org/10.1080/10286632. 2019.1626850 Greater London Authority. (2019). Creative supply chains study. Greater London Authority. Gutschow, K. K. (2006). From object to installation in Bruno Taut’s exhibit pavilions. Journal of Architectural Education, 59(4), 63–70. Hesmondhalgh, D. (2007). The cultural industries. Sage. Hutter, M. (2011). Infinite surprises: On the stabilization of value in the creative industries. In J. Beckert & P. Aspers (Eds.), The worth of goods: Valuation and pricing in the economy (pp. 201–220). Oxford University Press. Jackson, J. T., Dellinger, K., McKee, K., & Trefzer, A. (2016). 5. Interdisciplinary perspectives on the global north and global south. In H. Gregory (Ed.), The sociology of development handbook (pp. 129–152). University of California Press. Karpik, L. (2010). Valuing the unique: The economics of singularities. Princeton University Press. Keller, K. (2000). The brand report card. Harvard Business Review, JanuaryFebruary, online at https://hbr.org/2000/01/the-brand-report-card Kranich, N. (2007). Countering enclosure: Reclaiming the knowledge commons. In C.  Hess & M.  Morgan (Eds.), Understanding knowledge as a commons (pp. 85–122). MIT Press. Kretschmer, M., Gavaldon, A., Miettenen, J., & Singh, S. (2019). UK authors’ earnings and contracts 2018: A survey of 50,000 writers. University of Glasgow, UK Copyright & Creative Economy Centre. Leadbeater, C. (2000). Living on thin air: The new economy. Penguin. Meng, B., Ye, M., & Wei, S.-J. (2020). Measuring smile curves in global value chains. Oxford Bulletin of Economics and Statistics, 82(5), 988–1016. https:// doi.org/10.1111/obes.12364 Mohr, J. W., Bail, C. A., Frye, M., Lena, J. C., Lizardo, O., McDonnell, T. E., et al. (2020). Measuring culture: An introduction. Columbia University Press. Pagano, U. (2014). The crisis of intellectual monopoly capitalism. Cambridge Journal of Economics, 38(6), 1409–1429. https://doi.org/10.1093/cje/ beu025 Parc, J., & LaFever, H. (2021). What does Emily in Paris say about the “Netflix quota” and the “Netflix tax”? Cultural Trends, 30(5), 466–470. https://doi. org/10.1080/09548963.2021.1991231 Reckwitz, A. (2017b). The invention of creativity: Modern society and the culture of the new. Polity Press.

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Resnick, B., & Belluz, J. (2019, July 10). The war to free science: How librarians, pirates, and funders are liberating the world’s academic research from paywalls. Scitovsky, T. (1972). What’s wrong with the arts is what’s wrong with society. The American Economic Review, 62(2), 62–69. Seaman, B. A. (2006). Empirical studies of demand for the performing arts. In V.  A. Ginsburg & D.  Throsby (Eds.), Handbook of the economics of art and culture (Vol. 1, pp. 415–472). Elsevier. Stewart, T. (1997). Intellectual capital: The new wealth of organizations. Doubleday. Tallis, R. (1995). Newton’s sleep: Two cultures and two kingdoms. Macmillan. Throsby, D. (1999). Cultural Capital. Journal of Cultural Economics, 23(1), 3–12. https://doi.org/10.1023/A:1007543313370 Throsby, D. (2003). Economics and culture. Cambridge University Press. Throsby, D. (2008). The concentric circles model of the cultural industries. Cultural Trends, 17(3), 147–164. https://doi.org/10.1080/09548960802361951 Tom Fleming Creative Consultancy. (2015). Cultural and creative spillovers in Europe: Report on a preliminary evidence review. Towse, R. (2008). Why has cultural economics ignored copyright? Journal of Cultural Economics, 32(4), 243–259. Wherry, F. F. (2008). The social characterizations of price: The fool, the faithful, the frivolous, and the frugal. Sociological Theory, 26(4), 363–379. https://doi. org/10.1111/j.1467-­9558.2008.00333.x WIPO. (2017). How to make a living in the creative industries, Geneva: World Intellectual Property Organization, online at https://www.wipo.int/publications/en/details.jsp?id=4166 Yan, J., & Yu, F. (2021). Can international coproduction promote the performance of cultural products in the global markets? Evidence from the Chinese movie industry. Review of World Economics, 157(4), 777–798. https://doi. org/10.1007/s10290-­021-­00415-­4 Young, J. O. (2001). Art and knowledge. Routledge.

CHAPTER 4

Enrichment Economy

Abstract  This chapter discusses ‘enrichment’ by Boltanski and Esquerre as an explanatory theory for cultural value, helping to distinguish creative industries’ value chains from those conventionally analyzed in global value chain (GVC) research. Contesting previous economic arguments (associated especially with Throsby) which seek to construct a cultural ‘production function’, we build on recent sociological and cultural theory to identify the ways that cultural performances and artifacts produce enrichment as a source of intangible value. Enrichment allows the goods and services flowing from GVCs to command a higher market price without any visible change in material inputs to their production or the amount of time spent in producing and consuming them. Enrichment is also the core source of value in the cultural value chains (CVCs) that generate art as a separately classified form of production. The chapter uses this perspective to clarify the various ‘forms’ of economic product identified in previous studies of enrichment and to understand these forms as determinants of value in CVCs. Keywords  Global media value chain • Intermediaries • Asset form • Collection form • Standard form • Trend form • Cultural performance In this chapter we introduce the enrichment theory’s basic propositions (Boltanski & Esquerre, 2020), using most of this chapter to discuss two © The Author(s), under exclusive license to Springer Nature Switzerland AG 2023 A. Vogel, A. Shipman, Film Festivals and the Enrichment Economy, https://doi.org/10.1007/978-3-031-33501-3_4

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forms of valuation, namely, collection and trend. Enrichment theory provides a theoretical perspective on activities associated with phenomena we have called ‘cultural performance’ (Chap. 3) to allow for analytic recognition of ‘live production’ phenomena. Enrichment arguments sharpen our focus on an analytic model of value-adding by event curations in festival formats (see more in Chap. 5) and run on grants-economic resources, by nonprofit actors and also public authorities. We begin by outlining why we deem enrichment theory important to the study of festival intermediation in cultural value chains (CVCs) presented in Chap. 3. Following this, we consider why value chain analysis should be interlaced with this theory and finish by discussing future developments in the global media value chain.

Media in CVCs Traditionally, a film is produced for public theater viewing. But throughout the twentieth century, exploitation windows for movie exhibition in the cinema became ever shorter and narrower except for the blockbuster (De Vany, 2004). The screen has been presented and consumed in ever-­ smaller windows, often seen as different media. It is now globally mobile on the smartphone where moving images are embedded in wholly different environments from the public theater. This masks an industrial transformation where movie exhibition ‘exploitation windows’ are being compressed and diversified in formats, which allows for more ‘value-­ adding’ windows to capture the attention of audiences who face cultural oversupply, can’t tell the differences without third-party information providers (Karpik, 2010), and ‘don’t know what they want’ (Schulze, 2013). Festivals are also time-compression phenomena, as they have evolved around CVCs as ‘valorization spectacle’ (Reckwitz, 2020). They compress cultural performance into a routine process of curatorship (see also Chap. 5) and allow actors attached to the festival to take advantage of event dynamics (Harbord, 2009), which we consider in more detail in Chap. 7 as ‘buzz’. This denotes a trend where a movie like many other accomplished cultural projects (Caves, 2000) depends increasingly on performers for its full expression and appreciation, among them on festivals and award shows (Anand & Jones, 2008). The trend is evident across the arts, as the quest for attention, and income streams, pushes authors, painters, composers, and designers to make more public appearances and performances, emerging from behind their finished work. Film may, more

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generally, set the presentational trends that other (including older) media are now forced to follow. While film performance studies (Hadida, 2008) aim to determine what makes a movie successful, focusing on the common industry elements, film festival researchers’ ample case studies draw attention to the festival as an experience-economic phenomenon that may entice a larger (and at times new) audience to immerse themselves in cinema, providing a range of program elements (special previews, master classes, etc.) in ways other formats of cinema cannot. Overall, events in cinema and more broadly in other industries have transformational potential regarding value-added, even facilitating the emergence of new industrial segments in CVCs (on animation see Leca et al., 2015). In this book we hypothesize that it is the event that integrates the chain (at a structural level) and that the organization achieves the chain integration (at actor level), through collaborative networks and stakeholder relationships. Global media constitute a value chain complex, whose rapid integration is spurred on by digitization as the major mass-distribution channel, and the instrument to exploit a variety of cultural products in a ‘mix and match’ form. The new channel, delivering old and new ‘content’ to personalized screens on demand, gives the appearance of passing curatorial power from concentrated Big Buyers to dispersed consumers, but in practice turns today’s platform businesses into powerful intermediaries  (see Chap. 2). This complex may serve as metaphor for an empirically fast or slow changing number of intersecting value chains (with varying levels of within-chain complexity that can be observed)—at the core being ‘cultural’ as producers and consumers tend to share meanings of what’s cultural. But CVCs can also emerge around the edges of other industries, interconnecting sectors and becoming bigger value chain complexes that aggregate more media while transforming many into digital form. Any local delivery that no longer requires moving people or physical commodities around may fall under the spell of digitization, an entrepreneurial challenge. Those in charge of more traditional CVCs will have to counter this by event work that keeps the venue-based experience unique. ‘Cultural hubs’ could be seen as another (re)assertion of the direct, unmediated experience, defying online capture. Rapid knowledge advance also created the next market challenge to the screen-based handsets as potentially replaceable by ‘smart glasses’ that—as told to a recent World Economic Forum in Davos—‘don’t have the drawback of the limited size of the screen’ (Tanaka, 2023).

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One source of profit in global value chains (GVCs) and especially CVCs is to get ‘free’ inputs from nonprofits and resell them at a price (fair trade qualifications are a pervasive example). A second source is to buy at a price and resell at a premium, through an ‘enrichment’ process that may not cost much extra. The third source is to gain monopoly control over one part of the value chain, so that sale price can be lifted further above cost even if no extra value is actually being added. The digital giants’ capture of film, TV and music distribution, and of nonprofit resources, is the shift that has gained most attention so far. Some of these dynamics can be grasped with the case of cinema whose history holds all the ingredients for illuminating its place at intersecting forms of valuation (Boltanski & Esquerre, 2020).

Enrichment and Value Determination In practice, value is determined in contested terrain between two extremes, because artists are never fully insulated from the market and consumers never fully determine their own preferences. Value determination at the extremes is split between the supply and demand sides, respectively. On the supply side, artists judge their own value, disregard the views of the audience (but not those of their peers), so implicitly rely on the patronage of the state or private sponsorship—and may do so in practice. On the demand side, value is ultimately determined by what audiences are willing to pay. No ‘objective’ value and critical acclaim can ever make up for box-­ office rejection. In the middle between these extremes, there is intermediation, as much art (or cultural objects and practices in general) is an ‘acquired taste’, with various intermediaries influencing people’s evaluations beyond socialization into a certain habitus or dispositions toward certain arts (or against them). Elder-Vass (2022) suggests that buyers’ and sellers’ valuations are socially shaped by a large ‘infrastructure’ of valuation theories or methods, and of intermediaries who persuade them which method to apply. (Valuation is also evaluated, contesting methods of ascribing quality.) The infrastructure includes advertising and marketing (A&M), specialist intermediaries such as estate agents or second-hand car sellers, and ‘value-­ entrepreneurs’ who persuade particular buyer communities to value commodities in a particular way. Most people in the world learn about culture from intermediation in consumer-goods markets (Beckert &

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Aspers, 2011; Karpik, 2010). A great array of private and public institutions, however, has been put in place and motion to spread cultural education as ‘life-long learning’, including in art markets and quasi-­markets that are inhibited by a range of intermediaries such as critics, collectors, curators, ‘connectors’ (Gladwell, 2000) as well as connoisseurs and social actors outside the arts who draw attention to artistic products through association with their own, thus being collaborators. Linking cultural outputs to inputs quantitatively via a ‘production function’, Throsby (2006) takes the artist’s income as a measure of the quantity of output and additional indicators to gauge quality of output. The revenue measure can be subdivided to distinguish creative outputs (actually practicing the art) from commercial outputs (less creative activities, such as teaching or reviewing, done mainly to supplement creative income). One econometric difficulty with this approach is that the quality measures (exhibitions, commissions, and sales of work), distilled into a dummy variable for quantitative estimation, may not be independent of the quantity measures, since these are likely to correlate with income. But if this is avoided, it raises the evaluative difficulty of modifying a market measure (the amount that an artist’s work receives when offered commercially, generating their income) with a measure of quality recognition conferred by the art world, through the award of exhibitions or commissions. This re-invokes the distinction between economic value and a separately judged ‘cultural value’, which sits uneasily with the production-function approach drawn from mainstream economics. Hence we come to reappraise ‘enrichment’ as the latest of many rationalizations of intangible sources of value.

Enrichment and the Economic Process Boltanski and Esquerre (2020) reject the idea of a ‘post-industrial’ society (in the global North) because industrialization is ongoing, manufactured goods and manufacturing have grown during late-capitalism even when factories have moved to the global South. With the notion of enrichment they want to capture the intertwining of this pattern of de-­industrialization with what they see as “an economic model that establishes the value of objects in a different way” and is concentrated in—yet not exclusive to— the global North. Their approach comprises the idea of valuation of objects subject to commercial exchange. The forms of valuation

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help to partition and therefore to structure the universe of commodities because they are associated with modalities – that is, both arrangements and arguments – that make it possible to formulate propositions concerning the value of different things and also to set up tests on which to base arguments. The various forms of valuation generate arguments that serve to mediate, in a sense, between objects and prices. (Boltanski & Esquerre, 2020, p. 126)

Each  of the four valuation forms—asset, collection, standard, and trend—applies to a ‘system of equivalences’ that in turn relates to the justification of price (not to the character of the objects) (Boltanski & Esquerre, 2015, p. 81). Price (or money) is common to all these economies that can form around the operation of the core valuation principles. The theory entails that a historically specific ‘enrichment economy’ is operating in late-modern capitalism. At the core of it is the increasing role of the collection form, which refers to special appreciation (and methods) of economic practices and goods that regard systematic collecting—a pattern observable since the nineteenth century and wholly modern in its current logic. Economic practices surrounding luxury and heritage notions are core sites of enrichment processes. Observing objects on display— ‘valued for novelty, difference, and price’ and appeal by an aura surrounding them as ‘exceptional objects’—the authors write that both their appearances and advertisements are presented “seamlessly, as inextricable components of the same world” (Boltanski & Esquerre, 2016, p. 33). Enrichment provides a source of rapid and sustainable productivity growth very similar to that observed in ‘knowledge-based industries’ (see Chap. 3) and ascribed to intangible capital. Enriching allows to command a higher market price without any visible change in material inputs to its production, or the amount of time spent on it. This higher market price, with unchanged costs, raises the value-added per employee. The resulting productivity gain is amplified if, at the same time, the number of employees is being reduced, through organizational improvement that makes some staff redundant (or by casualization removing staff from formal employment contract). Enrichment also raises value-added by using ‘culture’ like knowledge (for a product upgrade example see Hulten, 2010) as a way to improve goods and services so that customers pay more for them. Cultural inputs are provided by artistic work performed in the past (as when a historical building adds value as the setting of a film or play, or a classic recording is revived for a new soundtrack) or in the present (as new studio or live

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work). This demonstrates value chain complexity, rather than multiple markets or industries. The extent to which enrichment can transform value is confirmed with examples such as Apple selling more consumer electronics hardware (and) at higher prices, due to the input by a single creative individual, the chief designer Jony Ive, whose departure from the company in 2019 created a drop of USD 9 billion in the company’s US American share price (Wittenstein, 2019). Similarly, enrichment occurred when a 1635 Rembrandt self-portrait, kept in storage as a suspected copy or fake, finally turned into a displayable artwork valued at USD 50 million in 2014 after tests confirmed Rembrandt as the artist (Morris, 2014). The contribution of art, design, and cultural references to adding subjective value—persuading consumers to buy ‘enriched’ objects and pay more for them—is also reflected by the growing use of artwork in A&M. Techniques from visual arts, film-making, music, and performing arts have been used to improve product image, make mass-produced goods and services look and feel more individual, and either globalize or localize the context of consumption, depending on which does more to enhance its appeal (Leiss et  al., 2005, pp.  519–578). Boltanski and Esquerre maintain that the enrichment economy derives its profits essentially from the wealthy while ‘the rest behaves as if they are rich’ (Susen, 2018, p. 242). There is evidence that aesthetic input has been especially important for stretching luxury brands into the middle market (raising sales volume). Without eroding their attractiveness to the elite, this simultaneously creates even higher premium versions to exploit the deepening pockets of the ultra-rich, using their custom to attract aspirational demand lower down the income scale. Heavy investment in current R&D accelerates the advance of knowledge but causes products built around past knowledge to lose value quickly. This forces knowledge-based companies to invest heavily in updating and replacing outmoded knowledge, and renewing their product and service lines to incorporate the latest innovations. Myspace, Friends Reunited, and the Digital Equipment Company are among many former ‘tech giants’ now obsolete because their once market-leading knowledge lost currency when not speedily replaced. At the other end of the capital durability spectrum, real estate (especially premium-located land) tends not to depreciate, and can conversely keep appreciating, even if nothing is invested in maintaining or improving it. The maintenance requirement of creative capital is intermediate

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between these two extremes: original artwork and architecture are notoriously expensive to maintain, ornate buildings needing continual repairs, paint and print fading in light, archives being vulnerable to natural disasters and physical attacks, and evolving playback technology that leaves many recordings stranded on inaccessible media such as floppy disks or plastic tape. Artwork can also move in and out of fashion, causing its value to fluctuate even if the originals remain intact. It appears that the old luxury goods industry has moved into proximity of a cultural heritage industry, both creating ‘exceptional objects’ (as discussed in Chap. 3), also known as singularities (Karpik, 2010). UNESCO protection lists illuminate the increasing variety of objects identifiable as cultural and cultural performance arguably in need of protection, illustrating enrichment’s focus on heritage as exclusive (in the sense of the luxury good) as an expanding global concern further aided by the IP regime and digitization for display and preservation. UNESCO certification for an exceptional good can be exogenous rent, as it attracts funding to local and regional development. Nonprofit organizations, including seasonal festival editions, play a role in heritage-making (Bair, 2011; Kádár & Klaniczay, 2022). In socioeconomic developmental terms, cultural heritage-specific enrichment may provide a way for older industrial economies to assert new areas of comparative advantage that are more easily retained against the competitive challenge from later-industrializing countries. Countries that industrialized earlier tend to have larger stocks of cultural products—including many extracted from former colonized regions—that can become inputs that enrich other goods and services, or provide a paid-for experience in their own right. The difficulty for newcomers to enriching with cultural heritage, at anything like the speed that industrial capacity and competency can be transplanted, has been demonstrated in numerous past instances, from attempts a century ago to create a literature in Esperanto to China’s new towns built round replicas of European landmarks. Additionally, the more digital the cultural value-added, the easier it is for the global South to catch up; while restitution policy (Savoy, 2022), if it can become more powerful and institutionalized, can also shift the balance, especially when the expertise associated with museum art also shifts to the global South. Below we clarify the four forms of valuation of the enrichment thesis, beginning with a very brief summary of asset and standard form, focusing

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on collection and trend form and what we see as linkages between asset and collection as well as collection and trend. We also discuss where in this framework the event (the cultural performance) emerges. Asset Form and Standard Form The standard and the asset form respectively take a background role in the account of the contemporary enrichment economy. The standard form account comprises the conventional economic analysis with a focus on industry or economy as manufacturing (as presented with the GVC framework in Chap. 2). Something is continuously produced in large quantities to the demands of uniform, predictable quality that can be readily purchased in competitive markets, from suppliers to customers in supplier networks, and finally consumers in retail markets. The standard form also emerges where “product differentiation is low, obsolescence is built in, and quotidian use-value in the present is of primary importance”. The asset form—associated with the industry of banking and financial services—is about a durable item that may be a physical product or a financial entitlement, generating future flows of income and being re-traded at some point. It describes the area where actors “balance risk, liquidity, and discretion against the potential for appreciation and future revenue” (quotations from Fraser, 2016, pp. 309–310). The asset form is associated with items that are bought purely for the opportunity to accumulate capital, the only relevant property of the object being its price. So anything can be an asset in this sense regardless of other values ascribed (Boltanski & Esquerre, 2016, p. 48). In our view, it also provides a valuation approach to intellectual property (IP) such as patents and trademarks, which historically enabled the standard form and is the key source of legitimizing brands in cultural markets (Boltanski & Esquerre, 2020, pp.  214, 306) but especially in knowledge industries (Cassier, 2021) as key base of manufacturing and enrichment economies. Both these forms of valuation occur mainly in ‘analytic presentation’, while collection and trend forms occur in ‘narrative presentation’— although not exclusively as shown by Karpik, for example, with the ‘opinion regime’ that can proceed on scores rather than qualitative elaboration (Karpik, 2010). This makes sense as valuation based on collection and trend forms can lead to being valued and priced in the industrial and the financial world (rather than turning into a noncommercial area of use or exploitation).

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Collection Form This form is associated with heritage and luxury (fields of cultural production discussed earlier). The logic this valuation principle comprises is the practice of systematic collection and a special relationship with the past— the latter being emphasized by Boltanski and Esquerre. The past turns up in craft and heritage, but also in identity and tradition. The luxury industry is the older industry based on enriching but has remained a private economy, while heritage’s scalability potential lies in the public domain. Both industries are important to the global economy, especially as collection and trend forms combine powerfully with the other forms of valuation in the global media value chain, also extending to other chains not obviously linked into CVCs but having to contend with CVC actors. This happens, for example, when heritage professionals discover archaeological sites that are in the way of the extractive industries (producing along the standard form) and will increase their presence with identity, diversity, and democracy demands on participation that the enrichment economy can ‘process’ with ease. Applying the aforementioned six intermediation roles of value determination, we see curators as core actors, being experts in providing cultural performances. They engage in valuation-worthy work by assembly of individual artworks (creative art, see Chap. 3 for our distinction) into complementary and sequences as well as immersive spaces for connoisseurs and critics to enjoy (and valorize). Perhaps looking for systematic fulfillment of their collections, collectors are also central experts whose selections, for their private or displayed portfolios, indicate to others what is worth having (see also Boltanski & Esquerre, 2020, pp. 312, 459). Critics, connectors, connoisseurs, and collaborators are all typical arts-worlds roles but serve as resources to curators and collectors, even as inputs to immersive experience settings that curators craft and to which collectors add ‘necessary input’. Curators, whose Latin-derived name stems from caring, are associated with the ethos of systematicity while looking at the past. The tendency toward systematicity (a defining element of the collection form) is by no means applicable to all curation and may even be rejected if found out by some art-worlds members. Hans Obrist, analyzing curation as one of its leading contemporary practitioners, identifies his craft as a role combining the preservation of previously created artwork, the selection of new works, the design of exhibitions to display old and new work, and contributions

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to art history and criticism that assist audiences in appreciating individual and assembled works (Obrist, 2015, p.  25). Curating decisions are of increased significance where the quantity of available art (and other information that competes for our attention) rises exponentially due in part to digital storage and transmission (Shipman & Vogel, 2022, p.  12). This appears to confirm the bias in the enrichment economic assumption toward an embrace of the past. The associated increase in curatorial power may be countered by a rise in the number of curators and in competition among them. Curatorial work, including festival curation, is hard to discern in employment statistics. Until recently, the occupation was the preserve of a small ‘leisure class’, which regularly enjoyed enough time and money to be spoilt for choice on what culture to consume, and required critics and curators to steer their selection if they lacked the time or knowledge to make it themselves. With rising incomes and shortening work time, education in cultural studies and arts management, wider sections of the middle and even working class have moved into a similar situation, and tend to widen the search for appropriate style guides (e.g., Holt, 1998; van den Haak & Wilterdink, 2019). The growth of social media has created and expanded the role of connectors and collaborators, often from a position of relative affluence. Influencers are not curators, as ‘arranging’ is not their primary task, which lies in the positioning of objects while influencers can basically ‘just talk’. Not all ‘arrangers’ (Reckwitz, 2017b), or curators, are creatures of systematic search for the past, and their deviation can lead to a transition into the trend form—which also designates the direction of eventization. Collections are defined as systems of objects, with Boltanski and Esquerre emphasizing that they are objects, not value. The elements of a presumed collection correspond to some higher entity under which they belong. A collector then is someone who can distinguish arrangements or simple arrays of objects, turning them with selective procedures into collection while applying systematicity to a form that makes the result plausible. As value is not inherent to art, the art of systematic arrangement is crucial for sorting a welter of cultural objects and meanings into a form that passes as collection format. Boltanski and Esquerre identify the logic as law of ‘small differences’: When the differences seem too large, collection fails to emerge, leaving behind the heap of stuff, or junk as nonvaluable. What is often ‘looking for variety’, is connected backstage to the systematic selection. To have access to enough ‘material’ for arrangement, the curators need specialists whose activities are valuation-based with respect to the trend form.

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Artistic directors of film festivals spend a good portion of their year to travel to other festivals to see what is new and what can be included in their next edition’s own selection. Mostly, festival curators look for things that they can arrange into a festival program, and which will secure a certain stock of reputation they have already accumulated (Lampel et  al., 2013). Where they fail to establish programs, the collection in enrichment-­ analytic terms, they can prompt dissonance in the audiences as to experience quality, but also set on alert attending or exhibited artists who find themselves in too little or too much proximity to artists they emulate or seek to distance themselves from. Curation in film art has long been extended from screening programming and gala events to collections in the original sense, such as creation of the Cannes Heritage line of the Cannes Film festival (Ostrowska, 2016; Gonzalez Zarandona, 2016). This aspect underlines that collections of so valorized cultural supply can be turned into assets—becoming exclusive with age, thus adding on more past, such as when film directors die and no more legendary movies can be added but all had been included by purchase or benefaction. It also leads to the insight that asset form and collection form’s relationship is of importance to CVC analysis. How Asset and Collection Forms Inter-relate Film libraries are the assets in the global media value chain that are relevant today, which follows from the IP regime development and, on the firm’s side, the inability of even large companies to produce risky endeavors such as movies in a linear fashion (cf. Picker, 2004). Curators also create incentives for others, notably collectors and connoisseurs, to fill the gaps in collections. Art nonprofits can do that for free, extending a grant relationship into valuation space. But more generally, the past can also be made from novelties, which resonates with modernity’s major belief that the past can be written and rewritten (see also Muniesa in Boltanski & Esquerre, 2015, p. 82). In all cultural areas, ‘archiving’ and preservation of a back-catalogue is a very recent phenomenon, which has been given a seismic boost by the arrival of digital recording technologies. Until recently, most past artwork (and information generally) disappeared after a few years. In the music sector, for example, up to recently originals and copies were physically destroyed, or the means to reproduce them were lost. In film and TV, film reels were allowed to decay, tapes were recorded-over, some

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shows went out live and were not recorded at all, some were put on old types of tape or disk for which there are no players now. The global media has moved from there to a situation where everything is recorded, recordings can be replicated and multiplied instantly, and old work is salvaged to reappear in the new digital, archivable form. Film collectors and technology enthusiasts preserve and restore  the old reels, and the recording  machinery not usable in contemporary exhibition. In 2010, the restoration of one movie to make it last and to return to circulation cost around 20,000 USD (National Film Preservation Foundation, n/a). The newness and power of archives, and the role of preservation in expanding them, illustrates objects that may attain value by a special relation to the past. Between assets (stocks that generate regular income) and commodities (sold for singular income flows), collections as an intermediate category combine the stock and flow characteristics. Bundles of unique but related objects can, like asset securitizations, be retained for a stream of income or be resold (at a valuation reflecting anticipated future income). Unlike securitizations, collections can also be changed easily in size or composition by trading in component parts. Business conglomerates, investment portfolios, and professional sports teams illustrate the diversity of contemporary collection form-conforming objects—open to being traded as whole assets, or reconfigured over time by re-trading of parts. Archetypal collections are found in the cultural economy—assembled across space in museums and galleries and across time in festivals and events. They have become an increasingly important source of cultural income generation, adding value to singular creations through curatorial crafting while lowering cost via scale economies in production and consumption. They quickly reconstituted online when the global pandemic suspended physical colocation. Pressured by rising supply or restrained demand, some collections step up the trading of parts to raise the asset value of the whole; others seek external bids for the whole to raise more resources for renewal of the parts. Such trading requires subparts of the collection to be priced, on markets intermediate (or hybrid) between those for assets and commodities, or by another valuation process. We assess the collection’s existence as part-­ asset/part-commodity, which may raise the returns and spread the risks associated with the two polar forms. It explores collections’ role in protecting incomes of today’s producers against competition from the stock of past products, which often provide better-proven quality at lower cost

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and are made into closer substitutes by digital enhancement. The destabilizing impact of large second-hand stocks on profitability of newly produced flows, long recognized in financial markets, spreads to the ‘real’ economy as back catalogues grow. Enriching via the collection form may allow present producers to turn an assetized past from competitor into complement, and constitute a source of value not fully explained in recent analyses of the ‘enrichment economy’. Trend Form Systematic collection (classification) may be difficult to achieve where an ‘infinite variety’ (Caves, 2000) exists that is not bound by a strict genre regime such as cinema. In the enrichment economic analysis, the trend form is associated with the fashion industry but also luxury brands of the middle range (see discussion in collection form). Trend form-based formats such as festival competitions employ both creative principles, subjecting infinite variety (a problematic form of welter) into the valuation of A/B-list, ‘freezing’ the variety for the moment in hierarchization. In Boltanski and Esquerre’s terms, the economic space associated with enriching by collection has widened, possibly so as in postmodern culture there is no need for filling systematic gaps neatly, as diversity and fluid form are celebrated and people are able to ‘shift’ (Lyon, 1999; van den Haak & Wilterdink, 2019). Especially entertainment has lost its association with a ‘non-distinguished mass’ being highly individuated, a shift that parallels digitization (Reckwitz, 2020). Luxury, as introduced in middle-­ class markets, is more of a singularity produced as more widely available with the help of (stratified) intermediaries, removing its exclusive marker for social distinction. Trends gain attention under three conditions according to Boltanski and Esquerre: first, the circulation of many different, frequently changing things; second, these things are distributed differently under people (that means there is inequality tied to social position) while there is opening in the sense that people in inferior positions can access them, or get imitations of superior objects; and third, there is a relationship between ‘rhythm of renewal of things’ and the hierarchical positions, as elites either have things first (or are exposed to things first), serving as fashion role models. The existing social hierarchies (social inequalities) create ‘empty spaces’ (i.e., A is not having it because B has it.). The relation to objects is established over one’s relations to other people (in hierarchical systems). In this

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way, the trend form emerges in this framework as the site of ‘positional goods’ reproduction (Hirsch, 1977). Individuals use culturally and socially determined models of categorization (on classification research see Mohr et al., 2020). Boltanski and Esquerre illustrate lack of systematicity in collection by writing that ‘a folder full of files on our computer’ is not a collection. Collections of things such as files (digital objects—available in massive amounts and making up a good portion of ‘replicated art’ as well), however, are extremely common in the digitized world. They are the basis for the digital media value chain, but may serve equally well as the resource basis for valuation in the trend form (e.g., in data-mining). In our view, ‘infinite variety’ is the appropriate term for matter injected into trend-­ form-­enriching processes. As mentioned, curation of collection increasingly depends on ‘infinite variety’ and especially assessments that occur within trend-form dynamics. Observation of festival practice and participation in CVCs suggests that both forms of valuation, collection, and trend, are required to analytically describe the shape of cinema and its eventive direction. For European cinema, Elsaesser (2005) comments on the curious mix of Europe as ‘haunted by history and empire’ on one side and isomorphic spread of film festival trend, providing for valorization through reference to ‘real’ celebrities seen in real time (cf. Boltanski & Esquerre, 2020, p. 332), on the other side. From an economic perspective, trend-form dynamics in festival consumption can be grasped with Veblen’s conspicuous consumption effect, Duesenberry’s demonstration effect (cf. McCormick, 1983), and Leibenstein’s ‘bandwagon effect’ and ‘snob effect’ (1950) (for nonprofits see Kushner & King, 1994, p. 20). In the trend form, the objects’ value is determined with the instrument of the narrative valuation, as is the collection form, but takes immediate reference to socially constructed properties (such as class, age, beauty). It is frequently associated with fashion clothing, but does not stop at that. The trend form also implies that objects lose their value fairly quickly—in this sense, it is the opposite of the collection form on the temporal dimension. While successful collection-form dynamics lead to transformation into asset form, success in trend form leads away to the standard form (mass-manufacturing and commercializing based on success as singularity, novelty, surprise, and so on). There is another direction as when trend moves toward the collection form, if the value of the object is based on differences. Differences are subject to creativity being performed. This

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aspect of the trend form—cultural performance—is what allows objects to shift toward valuation corresponding to the collection form, even if only in convergence. Here, the trend form appears as ambivalent, involving processes of distinction and/or mimesis.

Conclusion: Value Chain Analysis for the Enrichment Economy In this chapter, we introduced the four valuation principles of the enrichment economy and related these to GVC and CVC concepts and propositions. Collection is the production of things (and their systematic ordering) related to the past. The heritage effect can be “manufactured, or induced, by means of cultural events – festivals, centenaries; or an environment that had previously been written off maybe be restored in order to host artistic spectacles” (Boltanski & Esquerre, 2016, p. 34). Mixed economies with state and philanthropic patronage (see also Chap. 6 on toll goods) serve large-scale heritage programs to capture value from ‘the past’. At the intersection of collection and trend forms, providing rich opportunity for artistic rent-seeking emerges the festival, which under certain conditions can function as a chain integrator. According to Boltanski and Esquerre, France exemplifies the enrichment economy ‘in action’, as an ‘excellent example being almost exclusively oriented toward worth from legacy and uniqueness’. As a ‘strong case’ of such enriching, France provides us with the puzzling question whether contemporary art and culture are perhaps nothing but the past reconstructed and ‘reassembled’ and ‘refurbished’? The appeal to culture, as in the ‘culture wars’ (Hunter, 1991) for example, may be nothing but appeal to a constructed tradition that may no longer be taken for granted, having to be remobilized in the service of that culture’s survival. Boltanski and Esquerre seem to think so (2020, p. 47). Secondly, there are what we can consider ‘weak’ enrichment cases, as they show different chronological and configurational patterns of enrichment. An example may be Singapore’s most influential leader Lee Kuan Yew who mocked Europe not just for the welfare state but also for restoration of its old cities—while taking down 1980s apartment buildings in good shape and appreciated by the public for their spaciousness. At the same time, the government was encouraging an economy building on the asset form through privatization of so-called Housing and Development Boards (HDBs) and ‘condos’, luxury-insinuating

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apartments with smaller units and more crowded surroundings in their place. This was (and still is, as the trend continues) mixing of standard (concrete), asset (mortgage markets), and trend form (nothing systematic or ‘past’ about these buildings) in forming an equally enriching economy, but sooner or later. The valuation form of collection—the more ‘classic variant’ of enrichment—followed right on the heels of luxury appeals in restoring the ‘arts district’ and highly selective traditional buildings, a common strategy of development via ‘culturalization’ (Vogel, 2023). Importantly, all enrichment economies unfold in a global network of relations, which suggests that study of colonial relationships and a postcolonial critique must enter value chain frameworks (Werner & Bair, 2021; Baglioni et al., 2020, p. 912). On more practical matters, GVC researchers adopting the conventions-school perspective (see Chap. 2) will find that the framework of orders of worth (Boltanski & Thevenot, 2006) is held as inapplicable to the study of economic practices: The four valuation forms do not correspond to values people would have, but “to different techniques of valuation, in the sense of different apparatuses that would provide the justification for prices with a set of notable characteristics, historically situated” (Boltanski & Esquerre, 2015, p. 79). The orders of worth (conventions) are a historical account of moral value formation and disputes on justice, whereas enrichment analysis needs no ‘apparatus of justification; when it comes to price negotiations’ as we are told. Yet, there seems to be room for moral argument in ‘conversation about price’, especially when one takes the wide variety of price-setting into account, not necessarily in the moments of the transaction Boltanski and Esquerre focus on (trial) but in the making of prices, designing prices or price lists, thinking about opening a business or putting on a sales event—all of which tend to invoke justifications for action and taking diverse expression. Similarly, intermediaries can shape discursively price and value narratives that include moral justifications (Haugsevje, 2022; Wallendorf, 2017). This seems to be particularly relevant as culture—now a viable economic good—has become such moral asset (on film quota Yecies, 2007). This suggests that the future of the conventions school is in a synthesis of these two frameworks, with the four forms of valuation taking the lead among the analytic instruments to build a powerful political economy approach. The beauty of the value chain framework is that it can be applied to any level of geo-territorial and geopolitical kind and also be studied as division of labor, again at all levels. The enrichment-economy perspective facilitates the study of a wider range of objects, coping with the fact that the

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observable global media chain includes heterogeneous objects that can be measured as culture. Much of the contemporary ‘Metaverse’ discussion seems to involve moving existing cultural assets into a 3D Internet, and is ‘enriching’ online experience with cultural products in the way just described. The ‘Metaverse’ signals that a process is underway that will significantly expand the ‘remote experience’ element in value creation, and that GVCs will transform so that they will run in the future largely or entirely through electronic networks, delivering ‘experience’ of some sort as the thing that people pay a premium for and straight to the end-user. Most certainly this will go well beyond culture and entertainment industries. This supports our argument that film festivals in media value chains, including cinema as still delineable industry, must be studied with an expanded concept of a CVC. Many industrial areas (segments) of the global media value chain are linked up with different chains and their commodities and other elements, including tourism value chains and television as major examples. In the second part of this book, we turn to festival events in CVCs and the artistic rent, showing that eventization is the second big source of growth for artistic value-added and emphasizing immersive environments as missing ingredient in value chains.

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CHAPTER 5

Source of Cultural Value-Added: Eventization

Abstract  This chapter explains how and why ‘festivalization’ has become a feature of cultural value chains, as artists seek increasingly large and spectacular events to perform or exhibit their work. ‘Live’ exhibition and performance are an important source of artistic income as economic and technological change (and increasingly concentrated distribution networks) erode the income from recordings and transmissions of such work. But the rising relative cost of live performance, an inevitable consequence of productivity growth in other industries, requires artists to put on ‘more of a show’ in order to justify the rising attendance cost charged to audiences. Festivals attempt both to spread this cost over a larger number of performances and to amplify audience experience through synergies between them and creative energies unleashed around them. Their pursuit of added value through the interplay of assembled audiences and sequential performances reflects their standing in the ‘experience economy’ (Gilmore and Pine). The scope for adding value through aggregating and arranging cultural performances has enhanced the power of curators, who professionally select, structure, and sequence the individual performances that constitute an event. Keywords  Festivalization • Eventization • Curation • Cultural performance • Experience economy

© The Author(s), under exclusive license to Springer Nature Switzerland AG 2023 A. Vogel, A. Shipman, Film Festivals and the Enrichment Economy, https://doi.org/10.1007/978-3-031-33501-3_5

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The widening use of festivals to stimulate economic production and consumption beyond the ‘core cultural’ industries more widely, remains to be explained effectively and located in value chain analysis. Artistic output can be ‘packaged’ into events, combinations of performances and/or objects that mix the characteristics of both. Events have the appearance of an object, but consist of (or include) performances that take place, in series or in parallel, over a number of hours or even days. Festivalization (Vogel, 2023) denotes a social process that emerges in late-modern capitalism from a historically specific configuration of social processes like aestheticization, economization, mediatization, and rationalization (Reckwitz, 2017b, 2020). We begin by arguing that eventization shifts perspective on economic analysis as events become the value location of investment. Section “Performativity” concentrates on the cultural performance, the ‘live production’ that enters cultural value chains (CVCs). We use performativity theory to situate the cultural performance in the CVC framework. Festival events have mainly been studied as organizational-sociological phenomenon (Rüling & Strandgaard Pedersen, 2010). Here we consider them as cultural-sociological phenomena in interdisciplinary perspective to emphasize the performative dimensions of these ‘complex creative goods’ (Caves, 2000). We also recall the seminal literature on the experience economy that underlined the role of the event and show the impact of such goods in their socioeconomic environments. In the second part of this chapter we propose the ‘value network’ as a more efficient concept for the worlds of creative producers, distributors, and audiences interacting in a CVC. More than just ‘configuring’ cultural fields in ways initially suggested by institutional theory (Lampel & Meyer, 2008), the event promotes a reconfiguration that can (temporarily) change the power dynamics within the value chain, with connections that sustain the flow of cultural products and enable audiences to derive extra value from them.

When Consumption Becomes Investment: Enter Events We hypothesize that in CVCs the consumption is actually the investment because it is by displaying or performing cultural work that the stock of culture is maintained and the skills of the artist developed. Both

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performance and its maintenance necessitate audiences who—in the wake of widening cultural production and softening of high/low art boundaries—become cocreative (Reckwitz, 2017b). While (often) meeting demands for democratic participation in cultural domains, and especially when financed with public money, cocreativity also inserts more uncertainty into the processes of interactive value formation as performativity theory tells. This is the proposed effect of short-term immersive curations in spaces of media value chains. The investment dissolves into consumption because activities necessary to execute arts and cultural performances (e.g., building or renovating a concert hall) just maintain a place but put nothing ‘cultural’ in that space. The implication of that is that spending on culture, by governments and private sponsors, would be open to the same unusual economic interpretation—the ‘current spending’ on what flows through cultural venues, and the ‘capital spending’ on the venues themselves, have an inverted role compared to all other industries. The inverted relationship between flow and capital (for concepts see Chap. 3) can be seen in creating unique value propositions such as sports stadiums that need to be filled with teams and spectators, thereby intersecting the asset and trend forms in the enrichment-­ economic activities focused on physical capital and cultural performance. The Beijing National Stadium, called the Bird’s Nest, is an exemplary piece of embellishing architecture, not just a building. Filling 80,000 seats for experience-seekers, instead of marketing it to tourists marveling at the architecture, leads to different valuation scenarios. Asset and trend forms can be expanded by collection-form valuation when, for example, additional economic activity leads to a ‘collection’ of stadiums held by brand-­ name sports and entertainment firms, similarly to artistic brands ‘collected’ by today’s Condé Nast platform. The increased prevalence of events could be explained, from the demand side, as a result of festivals being a ‘superior’ good, one for which demand rises disproportionately as people’s income grows. But the growth of events is more likely a defensive reaction against both the commoditization of recorded art and the Baumol effect on live performance. (Shipman & Vogel, 2022). Cheap reproduction and transmission of recorded work, especially via streaming services from large platforms (Towse, 2020), reduces artists’ income stream from past work that has been captured in digital form, pushing in the direction of live performance so artists earn a living. Because of static productivity, live productions become steadily more expensive compared to recordings that threaten to substitute them,

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as seen with many events in the COVID-19 pandemic, other mass-­ produced goods that ‘experience-seekers’ (Schulze, 1992) can also spend their money on. Thus, unless they are non-substitutable, like the comedian’s ad-libbed riposte to a heckler, live performances must become ever more of an event to justify their rising ticket prices. This problem opens the door for the immersive curation, either in single ‘edition’ of events or as entire ‘eventscapes’, linking them into a larger event (or event series) that create the atmosphere of a bigger crowd and synergies between assembled performers (for case study, see Joo et al., 2017), leading to an additional source of added value. In this sense we propose curated events are ‘complex creative goods’ (Caves, 2000) permitting analysis of their behaviors and effects in CVCs. Returning to our initial distinction between creative art and cultural performance (performed in Chap. 3), we observe that with ‘live’ performance these two stages collapse into one. There is no first-stage cultural artifact because the artist’s human and physical capital are converted directly into a nonmaterial experience, in phenomenological theory an atmosphere (Böhme, 2016) that spectators enjoy in the moment of production and comprise the ‘fleeting moments’ that worried the aging Max Weber. From the viewpoint of CVC analysis, the cultural performance need not be the final point in a valuation process, as even a live event may generate audiovisual recordings, written commentaries, and memorabilia that take durable form, adding to the world’s stock of creative and cultural capital. Under certain conditions, this enhances event spaces’ potential to become ‘marketplaces’ or ‘platforms’ (for business model see Towse, 2020, p.  1464). Despite their typically rich offer of inalienable goods (experiences) in impermanent aesthetic-social form (de la Fuente, 2008) and production of ‘fleeting moments’ (atmospheres), events contribute steadily to culture as conventionally understood worlds of objects (in tangibles like a book or intangibles as an unrecorded sound output of music-­ makers). This is due largely to the work of what Reckwitz calls the ‘arranger’ in the ‘postmodern art field’ (Reckwitz, 2017b). The aim of the event curator—as arranger—is to amplify the directly experiential, one-off elements of a live performance (or combination of performers) in a way that exceeds any experience from audiovisual recordings or online simulations, and which these cannot replicate. The return of a famous singer or actor to the stage, the launch of a blockbuster film or a book by a bestselling author can become an event in itself. For less established artists there is safety in numbers, with a festival or exhibition giving

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the chance to join forces and share audiences for an event that, sometimes over several days and venues, creates an atmosphere that may generate experience transcending any of the individual shows. This trend toward the eventive creative expression comes at the cost of more permanent production not yet reflected in value chain analytics. Event curation and curators are no longer ‘idle art’ (Ventzislavov, 2014) but an occupational creative pursuit most closely associated with the museum (Harris, 2013). Research on the museum field also reveals the intersecting of objects and live performances as regular curatorial missions mixing surprise production with preservation and dedication toward making valuable pasts—identifiable as valuation terrain for both collection and trend forms of valuation to take a hold. Curation is not essential in the sense that the late-modern economy has become performative in character overall—observable in any ‘stationary’ or ‘motionless’ and 2D type of artworks being potentially an object of ‘aesthetic mobilization’ (Reckwitz, 2017b). Curation is a role legitimized by the collective belief that it enhances original sources of creativity—therefore a necessary ingredient to CVC analysis. Professional artists may struggle with curations but also depend on them, as they have in the past when impresarios helped organizing an audience for their works. Eventization denotes the trend of increasing economic dependence of art on intermittent forms of valuation. Curators today benefit from abundance in objects for ‘cultural manipulation’ as well as art and artist oversupply, aiming for valuation in collection form but being dependent in that on the trend form. As CVC inputs, curators emerge in key locations to produce the conditions for instantaneous experiences on both the production and consumption side. At the individual level, there are interesting crossover cases: For example, musicians or actors who improvise are performers who have absorbed the creative role, and singer-songwriters are creators who have absorbed the performer role (see also Reckwitz, 2017b), but for empirical and analytic purposes we observe this separation. Event curation and the immersive practices generated can be clarified further with performativity theory.

Performativity The cultural performance is separable from the creator but depends on performers for its full appreciation. In modern culture, it is associated with theaters and concert halls—the sites of art performances for the public and

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critics to interpret and appreciate. The term performativity (originating in semiotic anthropology) denotes the observed private and public ceremonies and live performances of art, underlining that any culture must be interpreted in terms of texts, artifacts as well as its performances (Singer, 1959). Slowly emerging from the ‘text model’, picked up by philosophers Jean-Jacques Derrida and Judith Butler, the notion of the cultural performance in contemporary theater studies has become incorporated in a practice-­theory approach known as performativity theory. Originating in J. L. Austin’s speech act theory, ‘performativity’ is an essential concept in theater and performance studies and the cultural performance is one of its key concepts (Fischer-Lichte, 2021), relevant in our context as copresence, an important dimension of performed spaces and performed selves (Goffman, 1952, 1963). Austin’s key insight was that performativity entails not just speech but that speaking is always acting, with speech being potentially transformative. The classical anthropological concepts of ‘liminality’ and ‘rites of passages’ (Turner, 1996 [1969]; Van Gennep, 1960 [1909]) are supportive of performativity theory and its notion of the cultural performance. Ritual research (in the social science domain) concentrates on the problem of social order (especially initiation and group-making through ritual process) but performativity theory goes beyond ritual theories, encompassing many more phenomena beyond the anthropological interest in group loyalty. Feminist philosopher Butler’s (1990) work—elaborating the active process of embodying and the ability to transcend dichotomies (hence creating ‘gender trouble’, the title of her book)—proved influential on the contemporary direction of culture studies that broadly addresses performance strategies in social and aesthetic drama, enacting oneself and in the presence of the other (identity being an outcome of social process). Fischer-Lichte (2010, pp. 64–81) identifies key aspects of ‘live productions’ which are mediality (bodily copresence which generates contingency), materiality (performance space as immersive), semiotics/aesthetics (production of meaning through the performance), and the eventive aspect (the performance as singularity whereas the underlying script—the corresponding organizational routine—can be repeatedly performed). The event character of a ‘performed performance’ is of importance here because performances are interaction-based and contingent, are realized in autopoietic process—therefore requiring the analytic distinction we make. Events are unpredictable and emergent because of performativity.

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As scholars seem to agree, performativity processes do not necessitate bodily copresence. This makes the theory applicable to a range of media and events online, and dialoguing with the field of integrating digital information with the social environment of the audience or user-­participant in real time (Augmented Reality). A further proposition from performativity useful for our purposes is that production of sociality can be accomplished without the (re-)production of permanent social structures and without a reference to institutions (cf. Fischer-Lichte, 2010). Chapter 6, however, shows that there is a real economic-institutional basis that can emerge, capturing value form atmospheres and making it available (alternatively, limit it) to others—as complex creative good. In our view, the festival events in the media value chain should be tentatively approached as weakly institutionalized structure that can be explored as ‘aesthetic-­ social formats’ (discussed in Vogel, 2023, pp. 69–73). A festival event, in reality, has a basis in formal organization (the nonprofit that puts it on), is ‘sanctified’ by a moral-legal framework (thus partly directed by a central agent, government in this case), and a basis in social connectivity among individuals and organizations in its external environment. Atmospheres that can be felt, such as in festival space or in the cinema, are immersive and in this sense also a bodily experience. Atmospheres can be crafted (as curators do) but can only create “moments of potentiality and promise” (Michels & Steyaert, 2017, p. 98)—semantically distilled in the notion of ‘buzz’ (see Chap. 7). Immersion can also be produced through an ‘interplay between perception and imagination’ (e.g., of a cinema-goer) (Fischer-Lichte, 2021, p.  151). This serves to emphasize that valuation analysis encounters a performative phenomenon incorporating in its processes cinema as an already performative phenomenon. In late modernity, events have gained extraordinary significance, as public events, ceremonies of the private life, and as ingredient in local and regional tourism. As such they have been classified sociologically as ‘the extramundane’ that provide through their regular return and efficacy structuring nonetheless the everyday lifeworld—while serving as sources of enchantment and re-enchantment (Jenkins, 2000). Events are what Reckwitz calls ‘cultural affect goods’ par excellence (2017a, p. 126). They have wide-ranging and deeply structural effects as they contribute to the erosion of class milieu-specific culture (as studied by Bourdieu), with their dynamics for short-term attention for aesthetic-social goods and moral values (Rojek, 2013), aiding ‘mobility-identities’ (D’Mello & Sahay, 2007), and providing narrow windows for bursts of valorization

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spectacles. These can promote, as further  simultaneous processes, the popularization of ‘high-brow’ culture and the intellectualization of ‘low-­ brow’ culture (see also van den Haak & Wilterdink, 2019). Arts festivals are immersive cultural performances, providing novelties (of the ‘infinite variety’, cf. Caves) and expert valorizations (of the A/B-type list through juried competitions and critic awards, etc.). Festivalization concerns a range of ‘valorization spectacles’ whereby the valorization becomes an event in its own right and where ‘attention capital is distributed’ (Reckwitz, 2017a, pp. 169–174). In their pioneering assessment of a new type of economy, Pine and Gilmore (2011) identified experience as a fourth major type of production after those based on agriculture, manufacturing and service provision. They identify ‘experiences’ as the next step in the progression of economic value, demanding a business strategy focused on designing experiences for which audiences pay. The chronological progression reflects a pattern of innovation that raises productivity in, and commodifies, agriculture, industry, and then marketable services—enabling their output to keep rising while their labor (and sometimes capital) requirements steadily decline. Their classification may also reflect a movement up consumers’ ‘hierarchy of needs’, starting with basic requirements for livelihood before providing more nonessential physical goods and services and finally expanding the availability of sensual, experiential provision. Pine and Gilmore’s classification of experience goods in Table 5.1 (below) is based on the extent to which buyers are active or passive in the way they receive them, and the extent to which receipt involves immersion or contemplation at a distance. It also reflects that choices in a developed economy are about comparative leisure goods (Scitovsky, 1962, p. 242). The upper row of Table 5.1 identifies immersive activities whose value lies in high sensory engagement with the cultural experience. The realm of escapism, through which consumers seek involvement in an alternative Table 5.1  Forms of commercialized experience based on Pine and Gilmore (2011)

Reception (high proximity) Reception (low proximity)

Active participation (high)

Passive participation (low)

Escapism Active immersion Education Active absorption

Aesthetic realm Passive immersion Entertainment Passive absorption

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world as if it were the one they were daily engaged in, expanding steadily since the late 1990 and including new forms of immersion in both home and public entertainment (Hern, 2022; Joyce & Navarro-Remesal, 2020). In what Pine and Gilmore refer to as the aesthetic realm, consumers renounce agency to be swept away by their experience (mostly of a creative art or a passively enjoyed art performance). This is the contemplative realm of ‘concentrated viewing’, which—like escapism—contrasts with the absorptive activities (see lower row of the table) where spectators remain separated from the performance or performers’ experiences flowing among them. This is typical in educational settings where the increased need for active engagement between recipient and producer denotes an ‘educational experience’, while entertainment refers to situations where the recipient consumes the experience more passively. The boundary can be intentionally blurred, with educators increasingly using games and other entertainment-derived practices to make learners participate more actively. Active participation (immersion and absorption presented in Table 5.1’s first column) are the spheres where event formats emerge. With digital technology advancing, passive absorption has been a transforming area and can be observed as encroaching on the two high-participation areas. But even passive immersion has been confronted with eventization of high-brow forms of art now performed as club goods (Hess & Ostrom, 2011) or celebrity competitions (McCormick, 2009). Pine and Gilmore’s distinction echoes McLuhan’s suggestion that degrees of participation depend on types of media that can therefore be identified as either ‘cool’ or ‘hot’ (McLuhan, 1964). Curated events would fit the ‘cool’ type because they require increased involvement due to decreased description, which curators aim to produce with strategies of immersion and other aesthetic heightening. Anthropological notions of ‘spectacles’ that people view from a distance and ‘rituals’ in which they are directly involved are useful to situate the event as cocreation opportunities, mixing in spectacle and ritual (curator’s choice explaining some of their variability) but always providing for within-group interaction and that between group and the differentiated performers. Festival events are a prime example of cultural performance because the artwork is pre-­ recorded, and those who produced it (on or behind the scenes) are not present (other than as invited audiences, in business-related roles, or conferencing professionals).

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Impact Studies Enrichment, eventization, and performativity appear to govern today’s growth of economic value from creative activities. To quantify gains from festivalization, numerous empirical studies of ‘impact’ have been published in the past decade, calculating the economic contribution of cultural centers and events—often estimating the national and regional ‘multiplier effects’ of additional spending on cultural activity. To illustrate the main methods used, and a typical selection of results, we end this chapter on sources value-added with a non-exhaustive selection. Oxford Economics (2021) evaluates the direct contribution of the UK’s creative sectors to their gross value-added (GVA) in 2019, and their indirect contribution by analyzing their supply chain links to other sectors via input-output data. This shows a direct contribution of 2.1 million jobs adding £116bn to UK GDP, rising to 3.5 million jobs and £178bn toward GDP with the indirect effects. A GVA-contribution of libraries, museums, and other public collections is conventionally inferred, because none is shown in the data if their services are free of charge, but may still be underestimated because their revenue-generating activities (such as restaurants or room-hire) are ascribed to other industries. Using similar data and methodology, another UK study (Centre for Economics and Business Research, 2020) calculates that each additional £1 of cultural-industry turnover leads to an extra £1.23 in other industries, and each additional full-time cultural job supports 1.46 full-time jobs elsewhere in the economy. Multiplier effects for arts and culture—the ultimate additional contribution to the whole economy divided by the initial expansion within the cultural sector—rises to 2.1 for GVA, 2.2 for turnover, and 2.4 for employment, when the ‘induced effects’ on other sectors revealed by surveys are added to the ‘indirect effects’ shown in input–output data. Induced effects include the benefits of tourism drawn to cultural facilities and events that generate additional demand for other industries. The calculated size of such multipliers has been scrutinized closely, as they tend to be largest in countries whose cultural activity is strongly clustered—even though it would appear to restrict the likely spillover effects from growth in direct expenditure or employment. UK studies highlight the concentration of cultural employment and value-added in London and the South-East: While London records a disproportionate share of all industries’ GVA in the national statistics, cultural activities contribute almost 2% of non-financial GVA there compared to less than 1% for other regions (Table 6, p. 31 in the

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CEBR study). Where other regional clusters have recently outgrown the wider economy (e.g., Bristol and Brighton) this generally reflects local government stimulus (e.g., infrastructure and skills training) and from local universities and arts organizations securing grants-economic inflows of funds from national sponsorship budgets. A third study from the UK (Gutierrez-Posada et  al., 2023), probing UK multipliers further using panel data on UK cities from 1998 to 2018, found that each new creative job generated 1.96 or more new jobs in other sectors, with strong spillovers among the regional clusters contributing to this comparatively large effect. UK creative-sector growth over this period means that over 16% of all growth in non-tradable sectors’ employment could be traced to it. However, the multipliers were concentrated on service provision around the clusters, with smaller benefits to manufacturing and other businesses further away. To assess the impact of a large annual festival, Segre and Morelli (2022) analyze Italy’s 2017 Turin Book Fair and associated cultural festival, using regional input–output data along with financial and survey data gathered at the event. The expenditure multiplier of 3.27 (€ 41.7 m added to the Piedmont economy by € 12.7bn of direct spending on the event) reflects the focus on the region where this expenditure was concentrated. Cross-­ sectoral impact was largest on manufacturing, accommodation, and food, suggesting large spillovers to activities unrelated to the book trade but other value chains. Every € 1.00 of public money spent on subsidies for the event was shown to yield € 15 of additional spending in the regional economy, highlighting the ‘leverage’ achieved by public sponsors via the additional private spending that the festival induced. This additional activity meant that the festival had positive fiscal effects due to the public subsidies of € 1.18m being more than matched by an extra € 3.80m of tax revenue. Vecco and Srakar’s (2017) time-series data-based analysis on local incomes and tourism inflows estimate the impact of two Slovenian jazz festivals on the city and region that host them. In the period 2008–2015 when Slovenia was among countries worst-affected by the Global Financial Crisis and subsequent Eurozone crisis, the festivals attenuated the drop in  local expenditure and employment, contributing to economic resilience, as demonstrated. Indeed, festivals are often explicitly promoted by smaller cities and towns as a way to capture expenditure and employment (especially related to tourism) from the capital and other large cities (Salvador et  al., 2022). The displacement of activity between locations

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may be accompanied by deadweight losses if those larger cities respond by spending more on their own cultural sectors and events to stem any outflow. We add that it shows events as vulnerable to elite projects and, potentially, unintentionally involved in co-producing social polarization. These studies uniformly demonstrate a positive economic impact from cultural and creative industries, enhanced by ‘overspill’ expenditure and employment effects along their value chains that radiate into the wider economy. However, these gains are largely derived from ‘external economies’ and network effects, including the social or cultural capital that accumulates in networks (see Chap. 6). Empirical studies invariably demonstrate clusters of cultural activity, illuminating events as unique culturally ‘manufactured’ time–space compressing aesthetic-social forms are often associated with clustering, which we inspect in more detail in Chap. 6. Section “Film Festivals” briefly introduces the film festival and the research associated with it.

Film Festivals Over the past two decades or so, research on the festival culture of cinema—its history, its political significance, its relation to the mainstream film industry—has emerged together with a prolific publication culture, a space in academic discourse on culture, and a strong practice relationship with the events themselves (Taillibert & Wäfler, 2016; de Valck, 2007; De Valck et al., 2016). A typical case of a festival in this and our research frame is illustrated by the Göteborg Film Festival in Sweden that performs annually as the largest film festival of the five Nordic countries. Its 46th edition was staged as we were writing, providing audiences with 250 films in over 700 screenings during ten days. Its international network position is illuminated by the films being sourced from 80 countries, and its response to the COVID-19 pandemic in form of a curated ‘festival’s digital saloon’ for those attending online is also a typical response by today’s festival event culture. Film festivals have steadily expanded as an organizational population in the 1980s, totaling around 1500 festivals identified as active in a survey stopping at 2012–2013 (Vogel, 2023, p. 20). The total number of film festivals ever existing is not known but several thousands of them have been observed across the world and can still be found in archived traces. Many even dissolve before or after their first edition as they have not found their vital grants-economic base in public and sponsorship monies.

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Festivals of many other genres have seen similar population growth (see Boltanski & Esquerre, 2020, p. 100). Festivals are typically run by nonprofit entities (or as arms of government authorities like film policy bureaus), raising the question of their identity or nature of the good they represent (see Chap. 6’s discussion on toll goods). Festivals also serve the postmodern version of traditional conferences for professionals across the division of labor in cinema. Depending on the specialization of the festival, expanding industry classification (see Chap. 3) and digitization impacting the sector, film festivals have also opened to a wider set of media occupations and experts as well as their public and private stakeholders that attach to the festival event (Rhyne, 2009; Rüling, 2009), pointing to a strong role in the media value chain for a spectrum of festivals. Festivals are tasked as either showing films with little potential of distribution deals or films which they heuristically strategize as gaining ‘buzz’ from immersion by qualifying agents such as experts, audiences, and the media, which may help them into cinema exhibition and commercial exploitation further along the chain. Film festival researchers have tried to pinpoint this phenomenon with concepts such as a ‘festival network’, dynamics of a ‘circuit’, the events’ ‘circulation power’ and the claim that film festivals can be ‘industry nodes’ (Loist, 2016; Iordanova, 2015). In this way, the still mostly case-based ethnographic study of film festivals have increasingly absorbed organizational-studies concepts, facilitating more meso-level conceptions of a ‘festival ecosystem’ and study of industry relations, albeit in absence of a value chain approach. Festivals continuously diversify in genre as well as by creating sub-­ networks based on the characteristics they define as their respective mission’s goals. Measurements of their effects on film performance are rare and need further development, but first tangible results have produced results on the ‘film festival effect’ and a niche market impact as well as on the ‘virtuous cycle’ of festivals’ reputational accumulation (Mezias et al., 2011; see Chapter 6 in Vogel, 2023; Lampel et al., 2013).

Networks and Hierarchization The stakeholder hypothesis by Rhyne (2009) supports intergation  with cultural-economic conceptions available for the study of immersive events and their social worlds, and leads us to the crucial insight by enrichment sociologists that “the mission of cultural agencies – above all, the agencies that distribute the funding that cultural activities need – is to put people

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into circulation and bring them into contact, to organize encounters in order to promote the exchange of identities and differences” (Boltanski & Esquerre, 2020, p. 95). As shown elsewhere (Vogel, 2023), cultural work gets a short shrift in front-stage actor accounts of cultural events, with the little systematic research available  pointing to the need for research on workforce that makes events happen under pressures not normally encountered by those with more regular entertainment jobs, paid or unpaid. Event-staging demands more from cultural workers while further casualizing their role— especially when it is run by a temporary, project-based organization relying largely on volunteers with practically specified duties that will not congeal into an occupational form, and even less into a licensed professional field (Abbott, 1988). Festival work generates mainly intangible benefits, provided by opportunities to network with other attendees who are linked to the production and management parts of the value chain, as well as from sharing in the audience experience. We address cultural work with the concept of the artistic rent in Chap. 6, focusing in the following on the networking aspects of the event. Events are designed to give the audience a more extensive, immersive, and spontaneous experience than any sequential presentation of its separate parts and are a ritually organized temporary form of art worlds-merger (Becker, 1982) where spontaneous outcomes are an expectation. When gathered for a public event, personal approaches that might count as online harassment or ‘cybertrespass’ can be legitimately made in the festival’s shared spaces. This concentration and close connection of actors, as well as its transformative normative aspects, can turn festivals into a trans-­ organizational structure, often called ‘festival network’, which “shape field evolution by providing opportunities that induce various participants in a field to come together” (Anand & Watson, 2004, p. 60). A large festival can assemble, in microcosm, representatives of a cultural field that has been very broadly defined by institutional theorists, as extending to “key suppliers, resource and product consumers, regulatory agencies, and other organizations that produce similar service or product” (DiMaggio & Powell, 1983). Events can reconfigure such fields (Lampel & Meyer, 2008) changing the composition of actors and the power relationships between them, and so giving participants—especially newcomers to the field—the possibility of forging new, stronger, or more direct communication links within it. Scott Erickson and Kushner (1999) view the event as a new form of organization, involving an alliance of actors totally

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dependent on one another for success—thus a network of connections and dependencies. Those actors include direct participants in the chain such as artists, festival workers and suppliers, and ‘stakeholders’ with an indirect interest, extending to local governments and social enterprises in the event’s catchment area and through hybridization of public space (De Molli et al., 2019). But organizers’ need to deliver a tightly scheduled program with a diverse, briefly assembled workforce also leads to hierarchization of the event format. Constituents of the organizing coalition tend to be small and centralized, departing from the more usual pattern of smaller (especially nonprofit) enterprises having more diffused and decentralized authority structures (Kushner & Poole, 1996). Via internet-enabled ‘cloud work’ (Howson et al., 2022), organizers can now spin-out some tasks to freelance workers (and audiences), creating a new lower tier of people whose connections to the festival stay remote, excluding them from any on-site social networking with coworkers or other participants. To make hierarchy efficient, however, managers must ensure that subordinates are still sufficiently empowered to be able and willing to share ideas or initiate actions—a potential outcome we offer to explain with the artistic rent in Chap. 6. With respect to entrepreneurs, research by Gross and Zilber shows the curatorial power in professional conferences, as observed in “organizers’ choices in setting the stage (like location, décor, schedule)” that affect “the ability of other actors to act, allowing for only preferred experiences to circulate, be developed into stories, and consumed, while silencing and devaluing others’ perspectives” (2020, p. 13). But there is also room for authenticity, as events’ cocreative missions include the staging of multiple performances where the actors do the storytelling, which in turn restricts curators’ power to fully control their intended narrative, therefore countering ‘by design’ their imposed hierarchical form. While festivals mostly showcase finished work, much of their networking revolves around current and future production. Volunteers seek experience and contacts that will help them get involved in future projects; producers and directors look for new story ideas and people with the artistry to develop them, or pitch their worked-up proposals to sponsors and distributors. In creating a space for networked exchange of ideas and information, the event appears to solve the problem of innovation in form of a public good, costly to produce yet hard to monetise because it seems freely available. Through event-based network exchange, people with new

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ideas can communicate with others who might help realize and commercialize them, without their diffusing more widely—as they would in an open market—so that anyone can copy them free of charge. This highlights a type of problem shared between cultural and knowledge production, both requiring “the analysis of a public good beset by market failure” (Potts & Hartley, 2015, p. 268). Value Networks We approach events as essential to cultural industries’ formation of value networks, defined as “a collection of agents connected to one another via chains of transactions that, taken together, ultimately result in the production of economic value” (Gans & Ryall, 2017, p. 18), as “competition in markets means vying for transaction partners” (2017, p.  20). Within a value network, the power of ‘what you know’ is enhanced by ‘who you know’ in terms of the social connections available. This concept directs attention on the value-added of particular firms (or, organizations generally), individuals and sub-networks in the chain, calculating this as the value the whole network would lose if these specific components were removed. A participant concedes value if receiving less than this amount, and captures value if receiving more. Participants with few other trading partners or networks to turn to may find their transfer earnings to be some way below their value-added, so that others in their present network can capture value from them. Exchanges that might previously have looked altruistic or careless—giving valuable information away—appear more rational, involving reciprocal gain, in this perspective (Johnson & Knoke, 2004). In a relatively small network where members and their actions are visible to others, ostensibly generous acts may ensure a payback through the resulting sense of obligation, or to build status that leads to promotion and extra reward (Lampel & Bhalla, 2007). Looking back at Chap. 2’s introduction of governance, we propose— and depict in Table 5.2—that all five of the linkages between agents in a value chain, as identified by Gereffi et al. (2005), can be observed within most value networks. Audience-Side Networking Festivals enable socially embedded consumption, facilitating audience members’ connections to networks on the production side, which partly

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Table 5.2  Value chain linkages Type of exchange

What is exchanged

Governed by

Market Modular

Simple products Complex information to competent suppliers Tacit information Detailed information to less competent suppliers Instructions within organization

Price Standards and quality controls

Relational Captive Hierarchy

Trust and reputation Buyer power Organizational authority structure and rules

Adapted from Gereffi et al. (2005)

explains artists working in festivals, supervised by curators. But the typical ‘customers’ of an event are looking for an unmediated experience, immersion in the crowd rather than more formal, transaction-focused connection (see de Valck’s audience typology in Vogel, 2023, p. 149). ‘Network’ products have little value to sole users and gain value as more people acquire them. Examples include phones, online social network, and fan-­ club memberships. ‘Network economies of scale’ are also exhibited by products whose value depends on, or rises with, a surrounding ecosystem of applications and infrastructures: Tesla electric cars became more useful as rising ownership led to installation of more public charging stations, and Apple phones as more users led to more downloadable programs. This contrasts with another category exceptional to tradable goods and services captured with the ‘standard form’, the ‘positional’ product (Hirsch, 1977) which, by definition, gains additional value from inherent scarcity. Examples include secluded lakeside homes, doctoral degrees, golf-club memberships, and city center parking lots. Either positional-goods supply cannot be increased, so the price rises due to competitive bidding as more people try to acquire them, or an increase causes their price to fall sharply as the exclusivity value is lost. We observe that cultural events can gain value from both ‘positional’ and ‘network’ effects and can be objects in both the collection and trend forms of valuation. The nature of delivery, in different or sequential stages is important to this double valuation. Admission to the big event is a positional good as tickets are limited and prospective spectators compete for them. The extraordinary event is depletable in the sense that seats cannot be offered to everyone who wants them without devaluing the experience,

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by overstretching the performers or seating the audience too far away from them (see more in Chap. 6). Once through the gates of the event, if it is adequately rationed, attendance becomes a network good, its value heightened by the chance to mingle and marvel with like-minded viewers. Creative industries have been reconceptualized as ‘network markets’, in which “an individual’s payoff is an explicit function of the actions of others… [in which] decisions both to produce and to consume are determined by the choice of others in a social network” (Potts et  al., 2008, p.  169). In this perspective, value is created (and not just assigned) in social networks, centred on audiences, whose choices are guided by observation of other people’s actions as well as their own preferences. Creative industries are better identified by this market determination of value than by any classification of activities on the production side (presented in Chap. 3). Their creativity lies in their outputs being an emergent property of complex social networks, leading to an evolution of production, industry structure and audience behaviour and participation in the economy’s ‘innovation system’ (Potts et al., 2008, p. 174).

Conclusion In this chapter, we prepared our economic analysis of the relationship between event and rent, by providing a case summary of cinema’s festival network, underlining the performative aspect of event culture, focusing the reader on the hybridization potential that creates spillover and multiplier effects in events’ surroundings to highlight the cluster and network aspects of the festival event and associate that with existing literature on ‘creative commons’ and the ‘nature of goods’ as relevant to cultural production. Our review of impact studies gives some idea of the scale of rents but says nothing about how they’re allocated. In Chap. 6, we look further into the source of economic gains from clusters, and the networks and the artistic management they facilitate—and how their allocation can be understood as an outcome of the creation and capture of rents.

Bibliography Abbott, A. D. (1988). The system of professions: An essay on the division of expert labor. University of Chicago Press. Anand, N., & Watson, M. R. (2004). Tournament rituals in the evolution of fields: The case of the Grammy Awards. Academy of Management Journal, 47(1), 59–80.

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Loist, S. (2016). The film festival circuit: Networks, hierarchies, and circulation. In M. De Valck, B. Kredell, & S. Loist (Eds.), Film festivals: History, theory, method, practice (pp. 49–64). Routledge. McCormick, L. (2009). Higher, faster, louder: Representations of the international music competition. Cultural Sociology, 3(1), 5–30. https://doi.org/ 10.1177/1749975508100669 McLuhan, M. (1964). Understanding media: The extensions of man. Routledge & Kegan Paul. Mezias, S.  J., Strandgaard Pedersen, J., Kim, J.-H., Svejenova, S., & Mazza, C. (2011). Transforming film product identities: The status effects of European premier film festivals, 1996–2005. In B.  Moeran & J.  S. Pedersen (Eds.), Negotiating values in the creative industries: Fairs, festivals and competitive events (pp. 169–196). Cambridge University Press. Michels, C., & Steyaert, C. (2017). By accident and by design: Composing affective atmospheres in an urban art intervention. Organization, 24(1), 79–104. https://doi.org/10.1177/1350508416668190 Oxford Economics. (2021). The UK creative industries: Unleashing the power and potential of creativity. Pine, J., & Gilmore, J. (2011). The experience economy, updated edition, Cambridge MA: Harvard Business Review Press. Potts, J., & Hartley, J. (2015). How the social economy produces innovation. Review of Social Economy, 73(3), 263–282. https://doi.org/10.1080/ 00346764.2015.1067756 Potts, J., Cunningham, S., Hartley, J., & Ormerod, P. (2008). Social network markets: A new definition of the creative industries. Journal of Cultural Economics, 32(3), 167–185. Reckwitz, A. (2017a). Die Gesellschaft der Singularitäten: Zum Strukturwandel der Moderne. Suhrkamp. Reckwitz, A. (2017b). The invention of creativity: Modern society and the culture of the new. Polity Press. Reckwitz, A. (2020). Society of singularities. Polity Press. Rhyne, R. (2009). Film festival circuits and stakeholders. In D.  Iordanova & R.  Rhyne (Eds.), Film festival yearbook 1: The festival circuit (pp.  9–22). St. Andrews Film Studies. Rojek, C. (2013). Event power: How global events manage and manipulate. SAGE. Rüling, C.-C. (2009). Festivals as field-configuring events: The Annecy International Animated Film Festival and Market. In D. Iordanova & R. Rhyne (Eds.), Film festival yearbook 1: The festival circuit. St. Andrews Film Studies. Rüling, C.-C., & Strandgaard Pedersen, J. (2010). Film festival research from an organizational studies perspective. Scandinavian Journal of Management, 26(3), 318–323.

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CHAPTER 6

Rents and Redistribution in the Cultural Value Chain

Abstract  This chapter examines in detail the forms of economic rent that arise at various stages along a cultural value chain (CVC). In addition to the rents arising from natural or artificial scarcity of productive inputs, as seen in industrial value chains, we identify and explain the ‘artistic rent’ arising from cultural workers’ willingness to keep producing when not receiving the full value of what they produce. We argue that artistic rent is revealed as an important and neglected type of ‘social rent’ (Muennich), the type whose capture and transfer turns ‘free’ markets into a social redistribution device. The chapter explores the emergence of two social forms promoting the generation and redistribution of rent along CVCs: cultural clusters, which concentrate such activity in space, and festivals, which concentrate such activity in space and time. Economic impact studies have highlighted income generation via ‘multiplier effects’ from investment in such concentrations without always tracking the flow of that income to show who generates and who receives it. The chapter also examines the types of networking activity that take place within these concentrations, particularly the links between practicing artists and the administrators and entrepreneurs who help connect them to public audiences and public support. Keywords  Festival • Artistic rent • Social rent • Media chain • Nonprofit • Clusters

© The Author(s), under exclusive license to Springer Nature Switzerland AG 2023 A. Vogel, A. Shipman, Film Festivals and the Enrichment Economy, https://doi.org/10.1007/978-3-031-33501-3_6

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Cultural activity generates economic value in different ways from manufacturing and service industries, as outlined in Chaps. 4 and 5. A strong implication of the analysis of cultural value chains (CVCs), not always explicit in past examinations of enrichment and eventization, is that value sometimes goes unclaimed by those who directly produce it. While some creative and performing artists are intent on career-building, and choose their art as the profession likely to maximize their earnings, many others pursue artistic life despite sparse and sporadic payback. This may reflect the refusal of others to value what they do. But more often they are part of a profitable enterprise, and the lack of reward reflects an inability or unwillingness to claim it. When cultural producers go unrewarded for all they do, it is generally because other players in the chain are claiming more than the value they can fairly claim to have contributed. For nonprofit organizations in the chain this is not the case, as by definition they take only what revenue they need to cover costs and maintain any necessary assets. Cultural sectors, uniquely, contain many participants who concede economic rents—knowingly or accidentally earning less than the value they create. These include public-sector and charitable organizations that operate as nonprofits, and artistic individuals and collectives, and tend to prioritize the production and dissemination of their work over profitability and returns on investment (Powell & Steinberg, 2006). This leaves unusual scope in most CVCs for the creation of unclaimed rents, and their migration along the chain to where other players can capture them. This chapter examines the sources and destinations of these rents, and the way industrial structures like clusters enable their circulation.

Artistic Rent Almost every sector has individuals and firms that receive economic rent— income exceeding the minimum that would keep them in their current line of work. The familiar explanation is that rent is available to those with exclusive access to a scarce resource. Classic examples are agricultural rents, received by the owners of the best farmland, who can price their products as high as those from ‘marginal’ land while their unit costs are much lower; and monopoly rents, conferred temporarily as a reward and incentive for innovation. In arguing that “the origins and drivers of GVCs are understood through the lens of rent generation, rent protection and rent appropriation”, Kaplinsky (2021, p. 153) identifies four distinct categories of rent:

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Natural rent  – accruing to owners of higher-quality natural resources (including land, energy and mineral deposits), who charge the same price as higher-cost competitors while their production costs are lower. Endogenous rent  – a temporary excess profit received by producers who achieve a cost reduction via process innovation or have a market to themselves due to product innovation (also called producer-rent, innovation-­ rent, or quasi-rent), which will be eroded by competition as others adopt the innovation. Exogenous rent – additional profit conferred on all producers in an industry via external action that reduces their costs (e.g., arising from public infrastructure investment, creation of  an industry-wide training scheme, or financial sector innovation that reduces small firms’ finance costs. Clusters (see further below) can lead to such external rents. Market rent – an excess profit due to scarcity, conferred artificially on one or a few producers (e.g., monopoly position granted to first-mover firms or industry champions, trade protection for specific sectors like the film industry).

Among all rents, which describe different ways of conferral of a ‘monopolistic edge’ all except for the innovation rent are of long-term nature, well-residing in a “neo-liberal world where competitive markets are supposedly dominant” (Harvey, 2001, p.  397) and where political regime changes are relatively rare. They are of the kind for which would-be monopolists unproductively compete. Contradicting the competition narrative, market rent arises from the power to raise prices while barring entry to rival producers, rather than the achievement of lower costs that secures a profit while higher-cost rivals just break even. These four rents, identified in industrial global value chains (GVCs), can also be observed in CVCs, as we illustrate with the festival event as typical actor in such chains. The following table lists a fifth type of rent, which falls out of Kaplinsky’s classification (Table 6.1). We argue that artistic rents emerge from economists’ traditional distinction between transfer earnings and economic rent. Transfer earnings are the minimum that someone must be paid to keep them in their current job, while the notion of the economic rent refers to the amount that someone is actually paid, additional to their transfer earnings. Applied to the arts, artists and event-related volunteers work for less than their ‘notional transfer earnings’, which is the minimum they would have to be paid if responding to purely economic/financial incentives. If they continue to work when their pay falls below this, this allows someone else to

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Table 6.1  Kaplinsky’s rents and the artistic rent, illustrated with nonprofit-­ festival events (developed from Kaplinsky, 2021) Event Natural rent

The event format is a resource for organizers to create nonprofit value. The resource is not the film or objects/subjects attached to it, but the event itself that is, festivals’ essential capacity of concentrating attention around a pre-appropriated set of resources needed to deliver a performance to audiences in a way the cultural object producers cannot accomplish. That can only be captured as rent if it can exist as a singularity: every edition and session of an event being unique, and not fully predictable from its program. The most successful events can charge a premium for quality while reaping scale economies reflecting past growth, achieving a natural rent comparable to that from owning prime natural resources. Emerging eventization theory suggests a social-structural change which identifies the structure of the event as a unique asset, capable of producing ‘buzz’, or quality signal. While creativity is not a scarce resource (Becker, 2017) the ‘social regime of novelty’ (Reckwitz, 2017) shapes both scarcity and excess of creativity (cf. Ch. 5 in Abbott, 2016). Endogenous The festival can achieve innovation rents: Creative producers have been rent significant developers of new organizational forms and working practices (Lampel & Germain, 2016), and nonprofit festival organizations can retain and develop creations by localizing and identifying them as particular cultural heritage. Film festivals engage in high-intensity competition exhibiting mimetic isomorphism (Elsaesser, 2005), but their often temporary form equips them to capture innovation rents before their innovation is copied by other festivals and cultural producers. Partly, this results from the character of trend form production. ‘Collection form’ production (Boltanski & Esquerre, 2020): if accomplished as in film heritage building, this can prolong value capture from innovation rents. Previous research focuses on what others capture as value from the festival (e.g., Lampel, 2011). The rent hypothesis serves the facts better than the capital hypothesis to indicate the festival as a value-chain actor. Exogenous This type of rent is institutionalized through the grants economy rent (Boulding et al., 1972) realized in nonprofits. There may not be additional benefits to the festival organization while many actors can draw on the festival as a resource supported by public and private philanthropy (e.g., Falicov, 2016). The festival has been considered as a money-making machine, especially when it can be connected to the tourism industry and, for some, to the creative industries. Festivals channel the access to exogenous rents from cultural industrial policy, regional economic agencies and alike, though this can make them a contested terrain that strains their ability to act as neutral market-making and deal-brokering intermediaries. (continued)

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Table 6.1 (continued) Event Market rent

Artistic rent

Festivals do not have control over input and product markets in the way that for-profit firms do. But the leading events may obtain a degree of market power, in procuring items for display and performance (and associated services) and/or in securing external financial support. Statistical studies (Mezias et al., 2011; Vogel, 2023, pp. 159–180; Lampel et al., 2013) show that there is a tendency to gain relatively more in exhibition settings. The festival–firm relationship can be studied in terms of trade protection and subsidies measures delivered through the festival, as when festivals serve as instituted mechanisms to filter out profitable works from the vast amount of noncommercial art that can be turned into value along the chain (e.g., the case of the Sundance Institute’s Catalyst Forum). Negotiation with powerful industry players can develop into collusion, as has long been suggested in the case of film festivals and Hollywood (Elsaesser, 2005). Festivals act as brokers for cultural production, including performers’ services and labor time that is paid below the notional transfer earnings (or not paid at all). This allows a variety of stakeholders (Rhyne, 2009), especially those focused on profit from marketable content, to capture value from those more focused on the delivery of content than the extraction of its marketable value.

turn part (or all) of their transfer earnings into a rent, and to capture this rent. This implies that the Superstar hypothesis (Rosen, 1981) is only a partial explanation for the extreme inequality of incomes in the arts and of why an elite stratum of performers, directors, curators, etc. scoop almost all the income. The analysis of rent shows that the great diversity of cultural goods and services—against all sustained belief in the mythical artist—has a place in GVC analysis as adjusted by CVC specification. Cultural production is subject to the dynamics of value chains; in this sense they do not represent a demarcated ‘alternative realm’ of economic freedom and creativity from the ‘more industrial’ type of work. CVC analysis grafted on the GVC analysis illuminates ‘the industrialization of the artist’ in its particular contemporary condition of space–time compression, where events are manufactured by project organizations intended to create ‘emotional economies’ that feed the attention markets of consumer goods society while exploiting the current industrial processes set on aestheticization and rapid free-market digital technology developments. This fifth type of

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rent is what Bourdieu (1983) has aimed to capture for modern art as a space of social practices he called ‘the economic world reversed’, as artists are willing to work ‘for the art’, or for less pay than they might generate in the market. For Bourdieu this was still a narrow group of people, but today it concerns many employees and self-entrepreneurs along the many value chains for cultural supply and bridging fields with adversarial logics (Svejenova, 2005; Miller, 2006; Jones et  al., 2016; Patriotta & Hirsch, 2016; De Valck, 2014). The identification of artistic rent, produced for example, in festival nonprofits, reflects the observation that while much firm strategy in value chains is explainable by the need to find tactics to lower costs, there is a structure in place in which such tactics are pre-empted. At the same time, there are areas of activity in which that logic of cost-reduction is not suspended. The need—for attainment of maximum value—in performing arts for copresence (of performers and audience), and in other creative arts for suitable contexts and juxtapositions, places unique constraints on culturally infused GVCs, leading to different possibilities for outsourcing and value-capture than those observed in other industries. Table 6.1 suggests some of the ways of market and industry behavior to insulate from competition and control scarce resource (or innovate so they will be scarce while others will be flowing, presumably, as gifts). Positing the question of labor in CVCs allows us to identify further who takes advantage, what kind of barriers to entry are created for competitors in the event-related economic spaces. It creates an opening for GVC analysts to extend their research on labor as factor of production into the global media chain (Bair et al., 2016). Alongside the question of why nonprofits arise (Witesman, 2016), the reasons why festival workers volunteer or work in precarious contracts (Loist, 2011) must be clarified. While it is normally assumed they do so out of a sense of public service or because of ideals, recent research has found a variety of reasons (Throsby & Zednik, 2011). Motivations extend to the festival work being regarded as an investment in future artistic career and income-earning possibilities, after the experience gained by voluntary work is converted into skills and knowledge that may secure a (better) job in arts and culture. Another motivational basis is associated with cultural workers’ willingness to get paid below their market value—or unwillingness to identify and bargain for that value, conforming to the inspirational polis (Vogel, 2023, pp.  215–236; Boltanski & Thevenot, 2006). This does not automatically mean the production of a rent that is

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captured by others, as the rent could go uncollected, and be spread across the community as a nonfinancial benefit. Such spreading occurs when cultural performance happens in open public spaces, with art being delivered this way becoming a ‘public good’ from which members of the public are non-excludable (Hess & Ostrom, 2011). Whereas the producers’ inability to recover their costs leads to the under-provision of other types of public good, the pursuit of ‘art for art’s sake’ leads cultural producers to work at full capacity even when fully aware that they are giving their output away. This permits any agent that can find a way to make the spectacle excludable, and impose a charge, to capture the rent from producers that was previously dissipated by openness to community consumption. Power differences in CVCs arising from intra-industry variation in product success and profitability are often reinforced by labor market variations. In most industries, a majority of the workforce have employment contracts that balance the employer’s need for flexible assignment of tasks against the employee’s need for predictability in the type, intensity, and pay-rate of the tasks they are given. Employment systems differ by country but strong within-country incentives for employers to adopt the common model exist. This suggests a homology between offshoring by firms to less developed countries where labor rights are weak and compensation relatively low, therefore adding to profits from relocation in the GVC (Gereffi, 2006). In line with our Scowl Curve hypothesis (see Chap. 3), the pattern deviates only in direction of labor markets, as artistic labor markets in high-growth and knowledge-economic countries are concentrated there— as are media conglomerates and elite centers of learning. We propose this as ‘onshoring’, especially when we consider talent moving for high-skill work from Dhaka to London or Lagos to New York City. The digitization of CVCs, however, allows onshoring to be challenged again by offshoring, as the case of IT services offshore outsourcing to India has demonstrated (Gereffi, 2006, p.  21). The film industry is a major offshoring actor of creative work into emerging economies (e.g., post-production facility for East Asia), but doing so around a creativity culture where work tends to blend in with non-work enriched by doing things cultural. The industry can behave this way because of coproduction funding, legal supports for foreign firms (Conor, 2015) as well as subsidies from regional film commissions that attract the crews based on cultural assets as well as cultural performances in their locations (Imanda, 2022).

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Private, Public, and ‘Club’ Elements in Cultural Production In this section we introduce the view that nonprofits could be an institutional arrangement to deal with unemployment slowing down growth (see argument around Hansen in Scitovsky, 1987). If more people are seeking work on the production side, but demand isn’t rising (or audiences aren’t willing to pay more), the only way to offer more jobs is to make people work for less pay or no pay. Agricultural economists in the past called this ‘involution’—the tendency to squeeze more and more people into farm jobs, with falling pay and productivity, if the rural population wasn’t moving off the land and into cities to work in industry. Possibly nonprofits do both things (tackle the positional goods problem, and soak up excess labor) in relation to different types of cultural product. The expansion of festivals as a source of enrichment in CVCs makes a case for a change of perspective in nonprofit research, arguing that legalistic framing of nonprofits—the conventional approach—is an obstacle to research on the nonprofit phenomenon’s evolution (see Witesman, 2016, pp. 97S–98S). Also noted by Witesman there is observable mixed economy of nonprofits with for-profits or government agencies (rather than a welldemarcated sector) and business model convergence across the institutional divide (Bromley & Meyer, 2017; Maier et al., 2016; Haugsevje, 2022), as well as overlapping labor markets across the institutional divide (Part Three in Vogel, 2023). The mixed-economy suggests that rather than being substitutes for government or market failure (or both), nonprofits are in some form of inter-collaborative relationship with for-profits and government agencies (competitive or cooperative). Labor markets for artists are also ‘blending’ across nonprofit and for-profit divides, added by the fact of a striking cross-country similarity regarding cultural employment and selfemployment (Marsden, 1999; Estevez-Abe et al., 2001), with conditions found precarious, leading to inadequate old-age security regardless of whether arts subsidies are generous or rather absent. Nonprofits offer important cues in this regard with their disproportionate amount of women employment and, relatedly, ‘flexible’ contracts, adding calculable costs to old-age security by underfunding, which awaits more scrutiny (see also Archambault et al., 2014; Themudo, 2009). The implication is that artistic rents are extractable under a variety of employment systems, partly because each system allows for the persistence of the inter-­firm profit and power differences that permit the emergence of social rent more generally.

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The institutional approach to nonprofits (Witesman, 2016, p. 99S) permits the approach of the festival nonprofit as a chain integrator and functional role in creative labor markets, as it changes from emic sector definition (based on policy-based classification) to etic-based (research) approaches of observing similar activities to then identify conditions for nonprofits to “arise in response to distributional problems encountered in society” (Witesman, 2016, p. 99S). In the absence of institutional rules (as in the festival industry), it is not obvious that a festival must be nonprofit—thus absence of what Ostrom defines as institutions, that is, “prescriptions used to organize repetitive and structured interactions” (Witesman, 2016, p. 100S). The global media chain, as a growing digital infrastructure, has made the creation and capture of value a highly networked process. The dynamics have been further affected by changes in the nature and marketability of cultural products, which can be clarified by using economists’ traditional fourfold classification (Table 6.2). Public goods, ranging from roads and flood defenses to scientific knowledge and the rule of law, are difficult to provide through private markets because of their non-excludability. Once they exist, people can easily use them free of charge: So it is hard for providers to recover their costs, and these goods and services would be under-provided if they were reliant on getting users to pay. It is also argued that some public services such as healthcare and education are not only public goods (with benefits that go wider than the recipient) but also ‘merit goods’, which should be allocated according to what people need and deserve rather than their ability to pay. The common conclusion is that public goods are best provided by a public authority that spreads the cost across the whole community that uses them. Some resources—such as common river land or forests—are not only accessible to all, like public goods, but also depletable. They degrade as Table 6.2  Four-way typology of goods according to (Fig. 1.1. Hess & Ostrom, 2011, p. 9; Witesman, 2016)

Value sharing

Non-excludability Excludability

Value depletion Non-substractability Public good Club good Toll good

Substractability Common-resource pool Private good

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the number of users goes above a sustainable level, and there may be a rush to deplete them as users realize they are running-out. The only way that public goods can be privately provided, and common resource use kept sustainable in the private sector, is to find a method of exclusion that enables providers can charge the full market value of their use. For most of the goods and services traded via markets, this is made possible by depletability. A car, cake, or haircut sold to one person becomes unavailable to everyone else, making it relatively easy for the seller to charge a price that covers their costs and delivers a profit. Where a product is not depletable, and governments cannot or will not provide it to everyone as a public good, the other option for prospective users is to form a club that collectively finances its provision by charging a membership fee and restricting access to those who have paid it. Many sports and social facilities, along with libraries and other information sources, have traditionally been funded this way. Some depletable resources such as motorways, city-center roads, and on-street bicycles have recently been converted into such ‘club goods’, using new technology to identify and charge those who use them. The extent to which a cultural product can, or should, be depletable and excludable is often unclear, leading to debates over where they are located in Hess and Ostrom’s fourfold classification (see Table above) and whether policies are needed to shift their location. The debate has been intensified by recent technological developments that appear to shift the location of creative arts and artistic performances. Performances in entertainment venues, which in principle are depletable and excludable, shift toward the common resource category if forged tickets remove any controls on entry, and toward the public goods category if ‘bootleg’ recordings enter mass circulation. Some artists have entered the ‘club goods’ category, offering performances or exhibitions to small groups who pay a high subscription fee, triggering protests by fans excluded from the club who view this as denial of access to what should be a private or even a public good. As the traditional way of arts and cultural production in late-modern capitalism becomes more complicated by the analogue/digital divide that splits the art world with the help of new technology, audiences continue to pay a premium for the analogue experience, for which the live performance in a venue surrounded by a copresent audience is the standard case. With digitization spreading, such events are inherently scarce and command a premium price, or invite a market of markups from first ticket sales that are

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then sold for an exorbitant amount of money such as in the case of tickets at price of USD for a current Bruce Springsteen concert ticket (Bauder & Associated Press, 2023). This highlights the neglected role of nonprofit organizations in keeping culture public, by putting on events heavily subsidized for everyone in CVCs. In unsubsidized events, such as major popular music concerts, it also highlights the use of volunteered and low-paid labor to keep costs down and maintain public affordability. Where they are treated as private or club goods, events and their constituent performances have become increasingly expensive to attend, due to rising costs that may reflect the Baumol ‘cost disease’ (see Chap. 4). While festivals’ expansion may counteract this by spreading fixed costs and achieving other ‘economies of scale’, costs may also rise as the division of labor becomes more specialized—with impresarios or curators getting colleagues in event technology professions as well as event lawyers and private security occupations (Rankine & Giberti, 2021; Pfeffer et al., 2021). Nonprofit action in the value chain can create value-adding opportunities along the chain synchronically and in the long run, as when superstars begin their career in a low-cost nonprofit venture promoting them as alternative artists. Rising live performance costs promote coalition formation between policymakers and platform entrepreneurs pushing for digitization, which gives audiences an increasingly realistic substitute—the digitally simulated, transmitted, recorded, or restaged version of the analogue live event (Shipman & Vogel, 2022). As the digital re-creation continuously rises in ‘realistic’ quality and falls in relative price, the back-catalogue of recordings (collection form, see Chap. 4) now competes with artists’ new material. Unless there is something identifiable about the live (analogue and physical) performance that will never be digitally replicated, new versions of ‘real digital’ will emerge. All this puts the focus on the human actor rather than just human capital that is subsumed in roles in an observed division of labor characterized by highly specialized inputs (Becker, 1982). Conflicting pressures on event organizers, to cover costs that keep rising relative to mediated alternatives and while keeping entry affordable and minimizing subsidy requirements, are transmitted along the CVC and are felt especially by its nonprofit elements. Easily accessed by volunteering, the nonprofit event organization is an ideal mechanism to sort creatives into related industry structures (Quentin & Campling, 2018; Leete, 2010). This has made it a globally widespread instrument to help people enter work contexts, often framed as in the cause of ‘societally beneficial’

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goals. Nonprofits are, however, also the means by which artists turn into creatives ready to engage in an increasing variety of labor markets, product and services markets. The commercial elements in the chain, to which many volunteers aim to move by reaching the professional parts of the network, compete with the nonprofit elements on whose connection and cooperation they also depend. That they can be means by which artists turn into creatives ready to engage in an increasing variety of labor markets, product and services markets, makes them an object of artistic rent. Following Witesman (2016), we propose the arts nonprofit as an instance of the ‘voluntary redistribution regime’—thus different principally from a coercive regime, neither payers and consumers being coerced by a central authority, and featuring some or all redistributive arrangements, where the payer is never the sole beneficiary or not a beneficiary at all (2016, pp. 102S–103S). Festival stakeholders (Rhyne, 2009)’ relations to the event can be conceptualized here. As an instance of the voluntary redistribution regime, the nonprofit can distribute toll goods (or club goods). Not all toll goods are distributed by nonprofits and nonprofits do not exclusively distribute toll goods. In Chap. 7, the relationship between the event and the nonprofit will be elaborated in the argument on chain integration. The Artistic Rent as a ‘Social Rent’ Artistic rent can be considered a form of what Sascha Muennich labels ‘social’ rent, which gives the holder of a scarce resource (of which land is only one example) “the chance to exploit value from institutional position and social rules”. Social rents arise from social relations set up around markets, and serve as a redistributive device, even though they “emerge from a mutual effort to overcome the uncertainty of economic action” (Muennich, 2019, p. 163). Upgrading of value chains aims at “altering production systems to effect the distribution of profits and rents across time and space in the value chain” (Havice & Pickles, 2021, p. 171). We hypothesize that festivals and other nonprofit structures are important as a redistributive device, detaching income from those who generate it and channeling it to those participants who are more alert to (keener to exploit) additional profit opportunities. With other forms of rent, the scarcity premium flows directly to the controller of the resource in an easily observable fashion. But artistic rents are generally less visible, because the revenue resulting from an art worker’s efforts may be displaced from their

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activity in time and space. The extraction of rent from such displacement occurs even if artists have formed, or gained employment with, an organization (such as a profitmaking firm, cooperative or nonprofit organization) as a form of protection from individual competition. Profit rates differ among firms, with only a weak tendency toward equalization through the transfer of resources from less- to more-­profitable ones (Konz, 1996; Nell & Thirlwall, 2018). This reflects imperfect competition, which enables firms to stay in operation without minimizing cost or maximizing revenue (Leibenstein, 1966), and the inherent variability of profits over time, which often leads firms to target a stable or slow-­changing output through time while allowing profits to fluctuate within a broad range (Coutts et al., 1978). Enduring differences among firms (even when supplying similar products), in terms of prices charged, wages paid, and profitability, allow the market to be viewed as a device that keeps a social system stable by coordinating activities and redistributing value (Beckert, 2009). But inter-firm differences in power can allow this redistribution to widen inequalities, as well as narrowing them (Muennich, 2019), with gaps likely to be exacerbated when some players (such as nonprofit or public enterprises) do not follow strictly commercial objectives. Imperfect or ‘monopolistic’ competition, allowing inter-enterprise differences in profitability to emerge even in what seems a precisely defined market crowded with suppliers, is especially evident in cultural products. Offerings that may look homogeneous in an industrial classification (publishing, music, television, software, etc.) are evaluated heterogeneously by consumers. These segment into many different audiences, which vary greatly in their willingness to pay for particular performers or performances, resulting in some artists attracting a mass market that afford them high prices and others serving a small niche for marginal profits. Since artists’ output is often a team production, and even their solo work is distributed mainly by companies they work for and art-world intermediaries, there is extensive flexibility in the way these different audience evaluations can be translated into earnings at the individual or arts-enterprise level. Adjustments can be made in an equalizing direction—for example, a film or music distributor cross-subsidizing lower-selling production from the higher-selling—or in a way that widens earnings differentials, as commercial success encourages the creation of a profit-making unit around particular artists and expands their bargaining power. The idea of prices, set in markets for particular goods and services, affecting the social distribution is unfamiliar in mainstream

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microeconomics but well-developed in other macroeconomic approaches. Until modern ‘neoclassical’ economics separated the micro-level price setting for particular types of product (and labor) from the macro-level setting of a general price level and income distribution, the two were analytically conjoined. ‘Classical’ approaches showed how “in a system capable of producing a surplus, relative prices are determined on the basis of the conditions of production and the manner in which the surplus is determined between wages and profits” (Roncaglia, 1978, p. 4). In the neoclassical scheme, prices can still affect income distribution by generating rent for the lower-cost (intra-marginal) producers, which it prefers to call quasi-rent, yet is equivalent to Ricardian rent on prime-­ quality land. As noted, the “stock of existing capital goods is comparable to land, and forms the rational for Marshall’s dictum that thee earnings of existing capital goods are quasi-rents. From this standpoint, the co-­ existence of plants with different techniques and costs is consistent with competition” (Salter, 1960, pp.  60–61) Structural inequality can then result from the scope for individuals and firms with the highest current income to acquire resources that yield additional rent (Sørensen, 1996). A competitive price system, which free-market theorists have usually described as eliminating ‘excess’ profit and ensuring that rewards stay proportionate to individuals’ productivity and effort, actually contains ongoing sources of rent that can affect the distribution of individual income as well as the social division between wage and profit income. The persistence of rent even under ‘perfect’ competition means that prices allow some participants to receive marginal revenues or rewards above their marginal costs, and thus effect redistribution under the guise of being neutral market outcome.

Exogenous Rents in the Global Media Value Chain Innovators who achieve lower costs by finding a more efficient process, or price-setting power by launching a new product, tend to secure the resultant rents for themselves by receiving higher profits (until others successfully copy their innovation). This is captured in the concept of the ‘endogenous rent’ (Kaplinsky, 2021). Natural and market rents, although separately identified in Kaplinsky’s and other typologies, share the feature of being captured by the same firm or individual whose activity gives rise to them. This contrasts to artistic rent, which is taken from—or voluntarily conceded by—the people or nonprofit firms from whose activity it is

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generated. Exogenous rents, generated by actions external to individuals and firms (such as governments’ infrastructure investment or industries’ collective training schemes), are also open to capture by different agencies within the value chain. Since, by definition, they do not arise through exchanges between specific parties, either as buyer and seller in a market or participants in a nonmarket transaction, they may flow to the participants who benefit most from the external action, or who invest most in seeking this type of rent. Cultural Clusters Cultural clusters are a globally recognized phenomenon. Creative activity tends to be concentrated in major cities, often in precisely located ‘cultural’ quarters or districts within those cities, with artists from various genres locating close together (Scott, 2010). Clustering has been traced to a similar set of economic and social factors that have been used to explain clusters in other industries—notably finance, digital technology, and vehicle and aerospace production. These include, first, lower transaction costs among producers (exchanges of ideas, materials, and products between parts of the value chain are easier, faster, and cheaper); second, lower transaction costs for customers (better services for buyers of the final product from suppliers near each other); third, shared markets for labor and specialist supplies (encouraging the necessary workers and suppliers to cluster around them); and  fourth, more effective industry coordination (cross-industry initiatives, e.g., such as training schemes, shared facilities, and lobbying benefit from geographically concentrated industry organization); and finally, general benefits of aggregation. The last refers to clustering of workplaces and linked residential areas that can deliver general benefits to all who locate there, via the concentration of buyers and suppliers, which enables public transport systems, mass gatherings, cultural events, and other amenities that are not economically viable in more dispersed locations (Graham & Gibbons, 2019). These benefits are generally summarized as ‘external economies of scale’, highlighting the way that resultant cost reductions and revenue gains arise within the cluster but outside any particular constituent firm. Alfred Marshall emphasized the importance of firms of the same type colocating to yield these economies, and assumed that ‘industrial districts’ could cluster anywhere (Belussi & Caldari, 2008), whereas the geographer Jane Jacobs highlighted the importance of heterogeneous activities within

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the cluster and of urban locations in sustaining them (Beaudry & Schiffauerova, 2009). However they arise, ‘external economies’ comprise significant sources of exogenous rent, while a cluster might also yield other types including artistic rents. Jacobs’ characterization is especially appropriate for cultural clusters, as recognized explicitly in her assessment of the value they produce in themselves and the contribution they make to other sectors’ value-added. Indeed, Jacobs stressed the importance of letting cultural activity intermix with other commercial activities, to exploit complementarity between their products and draw people to public places all through the day (Jacobs, 1993 [1961], p. 220). But a mix of creative and other more commercial activities is difficult to maintain, and may need public subsidy or planning support, because of the tendency for profit-driven industries to bid up real-estate prices and drive out nonprofits to more affordable areas. Clusters tend to form around lower-cost sources of finance and knowledge (Koepp, 2010, pp. 29–65) and can disperse again if their formation pushes accommodation costs too high, as London found when it tried to seed a digital creative hub in its East End (Volpicelli, 2020), and US cities rediscovered when the closure of studios by the COVID-19 pandemic was followed by sharp rent rises as the economy recovered (Goren & coUrbanize, 2020). Festivals and events—the source of cultural value-added examined in the preceding chapter—can be viewed as a spatially and temporally compressed form of clustering. Participants from all parts of the value chain, and audiences for their work, are brought together in close proximity, over a short period that intensifies the individual showings or live performances and participants interactions between the acts (Harbord, 2016) that are the elements associated with the trend form (Boltanski & Esquerre, 2020). A festival relies on the public space around it as it has very little space of its own, thus extending festival-space curation to other spaces, including cinema venues and other parts of the city (cf. De Molli et al., 2019, p. 1501). This is reflected in the economic impact studies discussed in Chap. 5. As fragile entities, their event-canceling or closure altogether affects more than just the organization (cf. Boltanski & Esquerre, 2020, pp. 95, 100). The festival can complement a permanent cultural cluster by bringing together artists who are not usually located in it, and by creating a concentration of activity in time as well as space. Where a cluster has dispersed into suburbs, as with film in Los Angeles, festivals can temporarily reconnect formerly colocated players that now work some distance apart.

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Festivals can also achieve cluster effects for a short time in locations outside cities that have no ‘arts quarter’ and cannot achieve a year-round clustering (Odabasi, 2016). The 1984 Liverpool Garden Festival and 1992 Seville Expo have served as attempted launchpads for respective clusters. While festivals often take place within an existing arts cluster, many also extend into other locations, combating the danger of the ‘culture monoculture’ identified by Jacobs’ US American study. Networks Many of the economic benefits from clustering are attributed to networks: social ties and communication channels between individuals and companies that can develop more easily when they are colocated and frequently in direct contact. Social capital (e.g., Putnam, 2000; Somers, 2005) has been identified as a distinct factor of production that materially improves the productivity of labor and other forms of capital. It exists outside of individuals, in the connections between them and the public spaces in which they confer and communicate. The advantages derived from social capital may be explained by reduction in transaction cost, from easier communication and higher trust among individuals, or by improvement in the outcomes of communication and exchange because of the greater frequency, quality, and synergy of knowledge exchange. For the production of singularities, Karpik (2010) makes an important analytic distinction, that is, the ‘reticular network’, the ‘trade network’, and the ‘practitioners’ network’ where types of social ties are employed in qualification, such as (in the same order) closest friends and family, trade and industry actors, and professionals. While, intuitively, the strongest ties might contain the biggest stock of social capital, Granovetter (1973) famously pointed out the strength of weaker ties, since it is people who are more distant from the center of one network who tend to be more directly connected to others, and who can therefore form the bridge that gives rise to especially productive exchanges of goods, ideas, and information. Burt (2004) also identified the importance of individuals filling roles as ‘structural holes’ in a network, who may establish particularly important connections despite, again, being some distance from its center. While some people may stay strategically placed at the center of a network, or at a connection-point between two networks, many move around and between networks carrying ideas and information. So in practice, the wielders of power within a network will likely be a

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combination of those with the numerous strong ties associated with network centrality, those with weak ties that bridge complementary networks, and those who achieve the same bridging by acting as intermediaries who travel across different networks. Interorganizational networks have also been identified as a source of added value. These shade into interpersonal connections at the small-­ business and micro-business levels. Between larger organizations, they take a more impersonal form in which network intermediaries may play an important role. Collaborative networks have long been observed as potentially generating gains for all members, and therefore allowed to operate by competition regulators. Alliances along the value chain, between firms and their upstream suppliers or downstream distributors, can reduce transaction cost and beneficially spread risks and rewards. Alliances across the value chain, between firms that would otherwise be rivals, can serve the public interest (as well as that of alliance members) if they permit the joint development of new products or of shared infrastructures that improve the existing products’ quality and affordability. The idea of public gains from interpersonal or inter-firm networking runs counter to earlier economic analysis that tended to view networking as imposing social costs, which were best reduced by counteracting them with free markets. This view was distilled by Adam Smith’s (1979 [1776]) famous observation that communication among people in the same trade quickly leads to collusion for the raising of prices and excess profit. The bilateral, personal, private exchanges permitted by networks subvert the market meant to be an arena of publicly viewable, impersonal, and momentary exchange, agreeing on little more than price and mode of delivery. But the potential gains to firms revealed by formal studies of networked competition (Lavie, 2021; e.g., Bochet et  al., 2020) can translate into benefits at the industry and whole-economy level, if they bring advantage in the competition among national networks. Current capitalism encourages the ‘networked market’ (Boltanski & Chiapello, 2005). Arts Brokering and Management as Exogenous Rent Many creative artists have difficulty channeling their inventiveness into final products for distribution. At the extreme, some writers, painters, musicians, and film-makers generate only a few finished works in their lifetime; even the more prolific often hold much of their output back from release, until entirely satisfied with its quality. Often performing artists are

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so dedicated to maintaining and improving their performance that, when affordable, they rely on managers, agents, and other assistants for much of the practical arrangement around their work. The business world discovered long ago that ‘creativity is not enough’ (Levitt, 2002), as for its value to be realized economically most creativity requires careful and continuous management. As with GVC analysis, management processes in the CVCs are not merely technical but involve political process as well as control of knowledge by powerful entrepreneurs (Baglioni et  al., 2020, pp.  904, 913–914). The organization of artistic creativity by arts-related managers is probably the simplest form of exogenous rent, often overlooked in studies that move straight to analyzing clusters and networks as its main source. External management by an individual or specialist agency (e.g., Mark MacCormack’s International Management Group as the archetype, and more recently Condé Nast) cuts the cost of bringing cultural work to public attention, or adds to the market value of this attention. This creates an addition to revenue that, when it exceeds the agency’s costs, can flow as rent to the cultural worker or to the manager (or be shared between the two). Larger agencies tend to be better at capturing this rent for themselves. But there are also instances of individual managers capturing much of the additional revenue from marshalling and marketing artists’ creative work, and of individual artists striking back against the agencies that initially manage them by negotiating a larger royalty share, or re-acquiring their intellectual property rights. Arts administrators or impresarios are in the path of a long tradition of tradeshows and market organizers (Aspers & Darr, 2011; Ahrne et al., 2015) but under current conditions of high uncertainty surrounding cultural production across all value-chain stages, adopting management techniques and business models under commercial pressure and exposure to ‘corporate philanthropy’ (Galaskiewicz & Bielefeld, 2001; Tuckman, 1998; Hwang & Powell, 2009) helped nonprofit-­ seeking activities survive while moving them closer to market actors.

Summary This chapter started with the argument that the artistic rent is a necessary concept for CVC analysis because it identifies the creative talent or the time and effort to support its creative exertion as scarce resource. A premium arises because cultural workers accept an income below the level they could receive from alternative employment outside the arts. They do

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not automatically claim, or even recognize, the flow of income that arises from their efforts, which is up for capture by whoever controls their activities. This is usually an agency that manages and directs them, or that owns and manages their intellectual property, unless they have asserted their own agency in the way that some ‘superstars’ do. We then conceptualized this form of rent by drawing on the ‘commons literature’, addressing private, public, and club/toll goods characteristics in cultural production. We further substantiated our arguments about a fifth type of rent with Muennich’s concept of the social rent. We then identified ‘support structure’ in clusters, which may create ‘external economies’, a source of exogenous rent, and networking (among individuals and organizations), which appears here as one of the sources of value that clusters are assumed to promote. The discussion suggests that film festivals can be viewed as a nonprofit platform because it connects up the people and companies that produce new content. Relying heavily on voluntary labor and grants, the bigger and more successful ones may maximize in grants from public and private sources, so becoming more resource-dependent. That leaves for-­ profit firms (big content producers or digital platforms) able to extract rent from the festivals that volunteers work for, as well as directly from underpaid cultural workers. The growing casualization and precariousness of artistic labor (as exposed by Banks, 2017, pp. 121–144 and Brook et al., 2020) reflects the Baumol effect—creative people’s drive to produce‚ art for art’s sake ‘is now exploited as a way to combat rising relative costs. For ‘arts related’ firms and professionals (i.e., those in the art world who are not creative artists), the escape from Baumol’s cost disease continues to be via exploitation (keep costs down by using free/low-paid labor) or commodification (mass-produce recordings and transmissions, as cheap substitutes for the live event).

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CHAPTER 7

Artistic Value, Ricardian Rent, and Power

Abstract  With the sources of artistic/cultural value and typical configuration of cultural value chains identified in previous chapters, this chapter provides an analytic account of value capture by powerful chain participants. Festivals, while mostly operating as nonprofits or with marginal profitability, are found to be key sites for the creation of fields and connections through which value can be extracted and transferred. This is largely achieved via the capture of rents—especially artistic rent, defined as income from artistic performance which exceeds what is needed to keep the artists performing. Festivals perform a chain-integrating role which in other industries leads to private profit generation, but in creative industries more usually sets up profit-making opportunities for others. The power that enables non-artistic capture of artistic rents can be enhanced by ownership of tangible capital, such as concert venues and broadcasting technologies, but is more usually exerted through intangible assets embedded in social networks. Festivals assemble and activate these networks on the production side while also creating added value on the consumption side, most visibly through the promotion of audience and performer interactions and the construction of physically and temporally concentrated ‘buzz’. Keywords  Value • Value capture • Rent • Intangible assets • Chain integrators • Buzz

© The Author(s), under exclusive license to Springer Nature Switzerland AG 2023 A. Vogel, A. Shipman, Film Festivals and the Enrichment Economy, https://doi.org/10.1007/978-3-031-33501-3_7

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Questions of whether and how some participants exert power over others have often been left unaddressed in global value chain (GVC) studies (Lang et al., 2022), and even more so in cultural value studies. The production of rent within those chains, including social rents that are open to redistribution, requires an analysis of who holds power within the chain and who can exercise it to shape the distribution of income and profit in their favor. Based on Chap. 5 & 6, we now look further at who actually generates, transfers, and receives cultural value, especially the ‘unclaimed’ value that flows as rent. We begin with examining the process of value capture by which some firms in a production chain can secure (as additional income) value created or stored elsewhere. We then discuss the tendency of ‘culture’ to grow even when consumed, and note on heritage studies, whose accounting approach helps identify how forms of valuation interlink in cultural value capture. The middle part returns to the neglected role of power in networks and clusters, followed by our hypothesis that chain integration is not exclusive to proprietary entities, but can also involve nonprofit organization that supports Witesman’s argument on ‘sectorial research’ bias presented in Chap. 6. The final section offers ideas on value derived from cultural performance through ‘buzz’, the key intangible asset of the festival, adding to explaining how eventization adds value with immersive environments.

Cultural Value Capture When examining sources of ‘cultural’ value across the previous chapters we identified two forms of rent that do not flow automatically to the owners of the resources that generate them. These were, first, the artistic rent, generated by individuals or firms that cannot or will not claim all the income their activities generate, and second, exogenous rents that arise at industry level—often amplified within clusters and networks. Adding the growth in size and number of festivals and events raises the specter of a third displacement of rent recipients from rent generators—these being Ricardian rents that may be flowing to a firm or event containing multiple networked constituents and/or external stakeholders, capable of competing over shares of the rent flow. The capture of unclaimed rent is part of the process of value extraction, defined elsewhere as value capture from other stakeholders “either outside or inside the corporation, by manipulating the competitive market process

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to the company’s advantage” (Strebel & Cantale, 2014). The crudest form of such capture is exploitation—paying workers or suppliers less than the value of their production, and charging customers more than the worth of the goods they receive. Capturing rent, that part of income that exceeds the minimum the recipient needs to keep working, is a fundamentally more sustainable form of value capture, as it ensures that participants will continue to perform as normal and not disrupt the production process even if they know that others are capturing the rents they produce. The appropriation of generosity—demonstrated across the literature on cultural employment (Vogel, 2023, pp.  256–273; Brook et  al., 2020, pp.  136–164)—includes a host of ‘offerings’ such as freebies and other small awards, t-shirts for volunteers, managers being charitable, allowing for flexible time schedules to help cultural workers accomplish multiple-­ jobholding, as well as free picks from the cultural product shelf in return for creative inputs from artistic entrepreneurs. This extends all the way to an expanding similar ‘suite of gifts’ in the knowledge economy, incentivizing valorization, such as when scientists receive them for delivering unpaid peer-review work to cultural firms who hold the power of distribution (Szreder, 2021, pp. 112–117; see also Elder-Vass, 2016). Growth of Cultural Stocks and Intangible Assets Cultural products tend not to be used up in consumption and do not automatically become obsolete as time passes, even if artistic styles move on. Where artifacts such as fine buildings, water colors, and constructivist sculptures do physically deteriorate, the growing scarcity drives up the value of those that survive. Where digitization of past recordings gives an opportunity to add value, the analog original (and reproductions) may lose value, but may still command a premium from some enthusiasts who regard them as more authentic and atmospheric. Digitization and improved techniques of conservation have further stemmed the loss of past artwork, meaning that the flow of new production leads to an ever-increasing stock—even in accelerated fashion through the interlock of communication, computing, and content known as ‘media convergence’ (Jenkins, 2006). Cultural sectors therefore engage in a double accumulation of fixed assets—maintaining and expanding the stock of artistic skills and equipment, and simultaneously expanding the stock of finished products, ensuring a rising supply whether or not there is a matching growth of demand. This has generated cultural value chain (CVC)

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platforms, fiercely competing with other firms in artistic rent capture— such as Condé Nast, originally a publishing company, that now interlaces arts, design, fashion, cinema, and retail activities, essentially viewing its competitive strength as arising from acts of curation  going beyond the range in which it holds intellectual property rights. The complexity of value capture locations in CVCs can be illustrated with a castle that now works as a cultural asset in the same way as original works of art and literature, and ‘living national treasures’ like great artists or film producers. Intangible assets can be built up by flows of intangible production, in the same way that flows of fixed investment build up the fixed capital stock (or prevent its depreciation). The castle becomes an even bigger tourist attraction when it turns into the setting for a popular film or play. Similarly, theme parks and film studios, for example, the giant site of China’s Hengdian Film Studios established in 1996, are assets that serve flow of cultural products like film and entertainment tourism (Cheung, 2020). The appearances and advertisements of such objects, as the enrichment theorists write, are presented “seamlessly, as inextricable components of the same world” (Boltanski & Esquerre, 2016, p. 33) but so are the various activities and objects relative to each other. A sudden rise in the value of an intangible asset tends to create what is, in effect, a new flow of cultural product; just as (in accounting terms) the appreciation of a physical asset is matched to a flow of income as if there had been more physical production. That happens, for example, when great artists die, triggering a public outpouring about how great they were and a rush to buy originals or copies of their work. Being given UNESCO status also boosts the value of a site as a cultural asset, raising the amount of cultural product it will now yield. The same occurs in Europe with the competition for the Cultural Capital appellation (Burksiene et  al., 2018; Lorincz et al., 2023), which routinely triggers hope for subsequent urban economic development but also potential for flow of ‘intangible’ cultural heritage that leads to more flow of tourism (Lopez-Guzman & Gonzalez Santa-Cruz, 2016; Kádár & Klaniczay, 2022). Value extraction from intangibles does not stop at  nature, as the heritage approach to the historical trade of Frankincense on the Arabian Peninsula illuminates. Tourism—created where it has no antecedent (Thesiger, 1959)—is mobilized to encourage cultural value flow from natural stock of ancient trees and from its surroundings of natural beauty. Rather than the historical trade route being the intangible asset (as narratives), the narratives of the ‘mystical incense road’ may be the intangible product that leads to an

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experience-economic cluster in the desert such as, for example, Oman’s archaeological parks. These in turn provide flow for national ‘imaginative value’ (for concept see Beckert, 2011) asserting Oman as ‘Land of Frankincense’ (UNESCO, 2023) from which further value-added can flow. Older artwork often commands a higher price than new works by current artists, whose value has yet to be agreed by audiences and critics, making it riskier to spend money to buy them or time to view them. Even if their prices are the same, older work can usually sell for greater profit because past production costs and (once out of copyright) licensing costs are fully defrayed. As the rising stock of marketable art, and price premium on past works, depresses the income most artists can derive from new production, they become more dependent on live (eventized) performance to generate a living wage. So the incentive to invest in performance skills also rises over time, as a direct result of the growth in material art stocks. Expenditure on the knowledge, skills, and software that go into cultural production has been recognized as ‘intangible’ investment, which is often excluded from conventional accounting because it has not been conceptually acknowledged or is difficult to measure (Haskel & Westlake, 2017). This leads to such expenditures being treated as cost of current production, rather than investments in durable assets that contribute to production over time. Reclassification of intangibles as investment can improve the statistical picture (explaining what appears to be a recent underinvestment compared to earlier times), and may have the practical benefit of enabling firms to benefit from tax breaks that were previously confined to tangible investments. In cultural industries, as well as the omission of intangibles, a second accounting problem arises, this time on the demand side. Audiences’ purchase of cultural products is assumed to be followed by their consumption—immediately in the case of live performance, or through private use in the case of artifacts such as paintings or recordings. But the value to consumers of most cultural products arises from contemplation or possession rather than consumption. The owner of a book, film, or other recording can retain it and use it repeatedly, for example, it can be as much a household investment as the electrical equipment that plays back a recording, especially if the owner can resell it and recover some of the cost once it has been heard or viewed enough. Electronic versions of cultural output become even more like durable investment goods, because they can be distributed to many users simultaneously without diminution of quality. They also can be distributed by temporary hiring-out rather than sale (the creator or distributor retaining

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ownership), and a consumer who wants to experience them again must purchase again. However, what might work against it—and for the case of events (‘cultural performances’) but not ‘creative art’—is that this advantage in durability adds more to consumer electronics in our basements (Gabrys, 2013) than to actual repeated consumption. This can be interpreted with the ‘social regime of the novel’ (Reckwitz, 2017) that nudges our appetite for cultural consumption toward the ever new or re-invented, using the durable investment in a way that is novel, eventful, and surprising. This underlines the way that the ‘enrichment economy’ thesis (Boltanski & Esquerre, 2020) may focus too strongly on the collection form, as the trend form drives much of cultural consumers’ willingness to pay in excess of production cost. Balancing Value-Capture and Value-Chain Sustainability A value-chain participant’s capacity to capture value from other co-­ participants in exchange is usually related to its degree of market power. Monopolists can raise their prices above costs, and allow their costs to exceed the minimum attainable because their customers have nowhere else to turn. Monopsonists can push the price they pay for inputs (including labor) down to the level of suppliers’ costs or even below this, since no-one else is competing for what those suppliers offer. Even in a market with many buyers and sellers, some will have a degree of monopoly or monopsony power because no-one else is selling exactly the same output or buying exactly the same input. However, even for participants with high market power, the scope to extract value is constrained by the need to enable its creation to continue, if the aim is to enjoy enhanced income over a period of time rather than grab a one-off gain that permanently damages the value chain. Extractors must ensure that those from whom they capture value still have enough resources, and incentives, to start the next round of production and invest in maintaining and enhancing their physical and human capital. This necessitates a view at the question of commitment in capitalism (Boltanski & Chiapello, 2005) and the wider economy to investigate how the different forms of power and rent play out in value chains. A value chain, especially when its participants are extensively networked, can be likened to an “ecosystem comprising a community of economic agents (firms and individuals) that undertake costly effort to co-create value” (John & Ross, 2022, p. 646). The challenge of those with power in this ecosystem is to maximize their extraction of value through time, by getting the best

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balance between the rate at which they extract it and the rate at which other stakeholders create more of it. This leads us to the proposed functional role of events as chain-integrating phenomena.

Chain Integrator The GVC represents a move away from ‘vertical integration’, in which successive stages of production take place within one organizational structure. Vertical integration need not entail all stages being concentrated on one site, as even the most integrated manufacturers tend to mine their raw materials and locate their distribution centers some distance from their assembly plant, with subcomponent plants scattered around this. But many multiplant and multinational firms adopted a vertical-integration structure in their early years bringing product design, component production, distribution, and marketing ‘in-house’. GVCs in the modern era began to develop when large corporations began to outsource and subcontract the operations that they regarded as non-core, buying-in goods and services they previously made internally. The best-known CVCs have shown a similar shift from vertical integration toward external sourcing from widening geographical areas. The industrial story of Hollywood and other successful national industries is one of first investing in and then divesting from directly owned stables of actors and distribution channels, separating production from exhibition (Vogel, 2007). Functions of national filmmaking and consumption have been incorporated in various ways in the digitizing media value chain. Once synonymous with studio production and vertical integration, the industry is now characterized by flexible production networks linking big firms with smaller businesses and project firms, including temporary one-­ project organizations in the production segment (Kehoe & Mateer, 2015; Christopherson & Storper, 1986; Hadida et al., 2020). While vertical integration has given way to more arms-length transaction between CVC stages, these transactions rarely occur via open markets, contradicting the view that ‘externalized’ value chains can be integrated without an identifiable integrator. Instead they involve bilateral exchanges within networks between representatives of powerful buyers and suppliers, whose size and leverage has grown as vertical disintegration promotes greater specialization. Self-employed or freelance individuals within the chain (such as actors and writers) rely on labor unions or agents

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to ensure enough bargaining power in negotiation with corporate representatives (Christopherson, 2002; Gray & Seeber, 1996). Events as Chain Integration Sites: A Research Proposition Festivals add value to cultural production, inducing audiences to pay more for direct and extended exposure to it. Part of this value emerges from unique interactions among assembled audiences and performers. But another part arises from temporary concentration of clustering and networking effects among those involved in production behind-the-scenes, which city-based ‘cultural centers’ achieve on a more permanent basis (as reviewed in Chap. 6). As vertical disintegration leads to a lengthening of CVCs, with more numerous participants dispersed at greater distance, it becomes more unusual for representatives of all production stages—along with audiences, their final customer—to gather in one place. The event emerges as an opportunity to coordinate and congregate. A value chain approach reveals that it is not the ritual (e.g., de Valck, 2007) but the reorganization of the economics underlying culture value extraction that creates the extramundane space. The festival becomes not only a production site, but also a forum for independent buyers and sellers of production components to exchange their wares and ideas. It typically fulfills all the criteria qualification scholars have ascribed to the market (Callon & Muniesa, 2005). That is, it turns outputs into discrete ‘calculable goods’, assembles the people who can collectively judge and price the output and ‘cocreate’ its value, assembles various ‘calculative agencies’ of differing power, which contribute to the calculation, and sets up ‘calculative encounters’ through which deals can be done. But festivals avoid the appearance of a marketplace. Tickets for the main events are prepaid and, once through the gates, legal transactions are confined to food, drink, and merchandise purchases. In the market as depicted (and advocated) by most economists, buyers compete against one another and are wary of the single dominant supplier. Festivals revolve around buyers who form a cohesive audience, united in appreciation for what is on stage. Hosting both ‘retail’ and ‘wholesale’ transactions, the festival is functionally very similar to the online platforms that now compete with it as a channel for cultural consumption. It brings audiences completed products (first deliveries of new work, revivals and collections of past classics) while also sowing the ideas and connections on the production side that begin to shape the next.

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By doing this ‘in the room’, the festival re-humanizes exchanges that other platforms have moved to impersonal phone and email exchanges, or even automated (in algorithmic markets). Unsurprisingly, several film festival researchers have made plausible claims of the festival being a distribution platform, including stressing its potential to dry up attention on independent or art-house cinema (e.g., Carroll Harris, 2017). Film festivals are just one way to highlight the role intermediaries play in aesthetic economies and where creative and cultural labor is vital to smooth operation, or even to operation at all. Examination of event productions’ broader intermediation capacities and competencies (Vogel, 2023) leads us to relate our chain integration hypothesis directly to enrichment processes, placing it in the discussion of market organization (Hamilton et al., 2011; Spulber, 1996) while expanding insights to the nonprofit form and the event format in cultural value chains. Festival Fragility Hypothesis In becoming a nexus of exchanges among value-chain members and their representatives, leading to the setting of valuations and sealings of deals from which income is realized, the festival necessarily also becomes a forum for the sharing-out of rents that a value-chain has generated. This is a delicate task, because the festival is also a source of added value from which rents arise. Festivals, like digital platforms, must persuade those trading through them that they are neutral intermediaries, not profiting from the connections and transactions they facilitate. In a formal network analysis, John and Ross (2022) show that when there are complementarities—which we interpret as rent-generating—in a chain, any attempt by one member to play the chain-integrating role risks making others suspect that they are seeking value capture, so that they reduce or even withdraw their value-creating efforts. John and Ross show how this deterrent effect can be overcome if the chain-integrating role is transferred to a cooperative enterprise, which shares the rents across participants in proportion to their value-creating efforts. Perhaps supporting this is the acquisition of the Withoutabox website-company for ‘indie’ filmmakers to submit through a centralized mechanism their films to festivals worldwide, saving bureaucracy against submission fee. After eight years, Amazon’s subsidiary IMDb, itself a database firm, bought up the site and started streaming through IMDb while extending into DVD (digital versatile disk) and VOD (video on demand)

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(Failory). Closed in 2019, the submission service worked for some festivals, but many, including the resource-richer ones, did not join. This may have been an early attempt, by Amazon, to gain profit from festivals, by extracting money and/or free data from them, making clear that festival film could be transformed into product data sold on for profit. The nonprofit status, often adopted by festivals, could be understood as a similar strategy, to ensure the uninhibited transaction among all users of the forum. But it leaves the festival treading a narrow path between making sufficient revenue to recover its costs and invest sufficiently in its future resourcing, and seeking additional revenue that other stakeholders might regard as value capture. It also exposes festivals to the risk of other, more powerful and profit-driven players using the festival to displace and disguise their own value-capturing actions. Peranson (2009), who as a film festival manager observed these tensions, explains how they are made inescapable by the festival’s need to balance two incompatible models. Festivals are almost always launched by enthusiasts following an ‘audience model’, focused on screening unviable films in a communal atmosphere. As they succeed in this and grow, they become a major propagator and distribution channel for such films, which increasingly rely on them as the revenue source that the Internet has not (yet) provided and that art-house cinemas struggle to remain (Carroll Harris, 2017). But festivals cannot continue delivering this service without moving toward a ‘business model’, securing additional income streams to cover their costs (including the rising cost of competing with other festivals in an increasingly crowded calendar). Whether this is done by charging more for admission, adding commercial-fee based catering and hospitality services, accepting more sponsorship or lining up more ‘blockbuster’ showings to attract mainstream cinema-goers, commercialization blurs the focus on the preferences of the audience and risks driving it away (De Valck, 2014). Moving to the business model can lose the ‘lively interplay’ between artists and audiences or among professional peers (Cousins, 2012; Peranson, 2009). The observations by film festival advocates, practitioners, and scholars can be formalized with the notion of brokerage relations (Stovel & Shaw, 2012; Stovel et al., 2011). The fragility of festivals’ efforts to act as a neutral ‘broker’ for dealings among value-chain partners is illustrated more formally by network analysts, who highlight brokers’ need to reassure all parties that they will not act opportunistically in future. Brokers are defined as agents that bring no new resources to the chain but intermediate between its actors, enabling

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knowledge and resources to flow between their networks. They must continually allay those actors’ suspicions that they will be co-opted by one of the networks to promote its interest, or use their privileged access to others’ information to act in their own interest. As argued by Katherine Stovel and colleagues, brokers can draw on three institutional arrangements that overcome tensions: isolation, broker capture, and organizational grafting (Stovel et al., 2011, p. 21328). Brokers can demonstrate their ongoing neutrality through strategies of social isolation (thus keeping visible distance between all parties), or ‘organizational grafting’ with an element visibly outside the chain, with no interests that would bias it toward one member. Paradoxically, brokers can also survive by being visibly captured by one of the value-chain members, acting as its gatekeeper, because this makes its interests transparent and allows other parties to seek countervailing power in bargaining with it. But all these stabilizing roles keep the broker precarious, with trust breaking down unless there is continuous investment in reaffirming broker neutrality—and a completely neutral broker will lack the independent income source to finance that investment (Stovel et al., 2011). The event space is a networked phenomenon (Boltanski & Chiapello, 2005; Scott Erickson & Kushner, 1999). Festivals don’t just allow new networks to form, they come into existence by capturing and aggregating existing networks, sometimes by linking networks together and connecting them to local government, commercial sponsors, etc., perhaps exploiting weak ties or filling structural holes (Granovetter, 1973; Burt, 2004). During the Danish festival CPH:DOX 2023, for example, selected projects are presented to over “200 established film financiers, representatives of streaming platforms, broadcasters, film studios, and philanthropic foundations” (Economou, 2023). As a communication tool, the event’s basic logic is to reassemble, like an ‘arranger’, in a way that leads to new situations and meanings (Martinez-Ruiz et  al., 2011; Reckwitz, 2017). Different people and organizations struggle to get their hands on the tool (Van Hemert, 2016; see, e.g., Leca et al., 2015). Festivals are always battling to obtain external (for-profit and nonprofit) supporters who will keep it financially viable, without letting powerful supporters exert control in a way that weakens others’ trust in the festival’s independence and undermines its status as a neutral forum (Rhyne, 2009; Gamson, 1996; cf. Falicov, 2016). While conventional thinking would seek the integrator role in an agent (a firm), we maintain that the event (‘cultural performance’) is the

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integrator. Festivals are often organized by several nonprofits and charismatic individuals who are semi-detached from them, and membership of this organizing ‘coalition’ changes year-to-year. Arguably, it is the festival itself that does the integration, with the festival space being analytically explorable as a field (Lampel, 2011). It is a format that alongside other formats incorporates in the CVC (e.g., for TV see Chalaby, 2016), which during the global COVID-19 pandemic has led to extension by ‘hybrid’ formats for festivals, to be partly online (for a Europe survey see Smits, 2021), as already before, where online festivals were a small minority used mainly for marketing toward independent film-entrepreneurial projects. Platform companies, which have emerged as media chain integrators, differ from festival event spaces in business models, but are homologous in that they provide a surface on which to assemble, quite like a facilitator that provides venue—investing in measures to enhance ‘pro-consumption’ by users (Vasudevan, 2022; Li & Qi, 2022; Zuboff, 2019; Staab, 2019). Under specifiable conditions, festivals can expand power geographically, taking a regional role in only few years of time, demonstrated, for example, by South Korea’s largest film festival in the port city of Busan (Shackleton, 2007)—just like platform business. This comparison underlines why film festivals owe their relative power in the CVC to the nonprofit status. For-profit platforms like Amazon have become notorious for mistreating the small traders who operate through them, for example, by charging them more or competing against them when they’re seen to have a high-profit product. Festivals maintain a better image because they seem to be creating and safeguarding public spaces and creating socioeconomic impact, or co-enhancing cultural heritage. The festival is a valorizing agency, creating symbolic value through its curation and audience-building activities. Their entry costs were initially low, so many ‘competing’ festivals appeared in the calendar (Vogel, 2023, pp. 18–32). Yet, examples like Toronto’s TIFF Bell Lightbox illuminates that the ‘prime’ festival sites, and those that got a prime place in the calendar, may be gaining Ricardian rent like owners of prime farmland; whereas if marginal festivals are generating any rent, it is of the exogenous or artistic type that others can capture from them. The hierarchy in the ‘festival network’ also demonstrates the confluence of valuation forms, especially the asset, collection, and trend forms. While the trend form is pervasive in cultural production and especially in the global media value chain, it is also the valuation form underlying the ‘buzz’; which effectively builds the chain.

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A Broker’s Solution: Organizational Grafting To act (and be perceived) as neutral brokers for the swapping of ideas and sealing of deals, festivals must remain self-financing through their own activities or externally financed by a balanced array of external stakeholders. Financial viability is lost if they cannot afford the resources needed for the brokerage role, and credibility is lost if they rely on just one partner in the value chain for most of those resources. One or more participants in potential deals will lose trust in the festival’s brokerage capacity if it shifts from a neutral coordination or liaison role to acting on behalf to one particular party, as its representative or gatekeeper (Gould & Fernandez, 1989). This problem is commonly solved by financing the brokerage role through the festival’s audience-facing activities. Sales of tickets, merchandise, and advertising relating to programmed events, plus payments from a variety of sponsors, can raise enough revenue to cover the cost of acting as a broker on the production side, in addition to the cost of staging the events. In economic terms, the ‘retail’ presentation of artwork and performances at the event can cross-subsidize the ‘wholesale’ networking activities occurring behind the scenes and between the acts. This cross-subsidy can, in principle, be generated while still charging audiences less than they would pay for an equivalent experience outside the event, or justifying a higher charge through the festival supplying a richer experience. As argued in Chap. 6, nonprofit festivals’ added value emerges largely in the form of exogenous and artistic rents that neither participating artists nor organizers can fully capture. To add to the problem, cross-subsidizing brokerage out of audience-related activities runs counter to festivals’ mission of bringing art to a new and expanding audience. The festival acts as a ‘club good’ provider in the sense that it collects subscriptions from those who join it so as to form them into a cohesive group that can collectively consume the assembled acts. This shields cultural products from the problems encountered by public goods (underprovided because access cannot be charged for) and common resources (degraded or depleted because access cannot be restricted). But festivals’ ability to ‘graft’ (Stovel et al., 2011) on the nonprofit form reflects their mission to extend beyond the confines of the ‘club’, and extend benefits to nonmembers wherever possible (cf. Witesman, 2016, p. 103S). This means an increasing tendency to cross-subsidize nonmembers’ participation out of the revenue raised from members—with initiatives such as free performances and screenings in public places, educational programs (for schools and by universities), and cut-price tickets for disadvantaged groups.

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Pressure on nonprofits to extend provision of benefits beyond their subscriber base, moving from ‘club good’ toward more general ‘public good’ provision keeps raising the influence of grants-economic actors (Vogel, 2023). This pressure has grown as public agencies move in the other direction—imposing additional access fees on goods and services that were once given free to all users and financed entirely via taxation. Governments themselves apply this pressure when they have financially assisted nonprofit provision via subsidies, tax concessions, or promotional help. But funds assigned to this audience-broadening cannot also be used to cross-subsidize the brokerage function. A radical alternative solution is to extend the festival’s revenue-raising activity into the ‘wholesale’, production-focused side, so that brokerage is financed separately from audience-related activities. This can be done if the festival enters some deal-making on its own account, for example, agreeing to sponsor some new production or directly acquiring the distribution rights for material to be shown. But this move from brokerage (linking buyers and sellers) to market-making (offering to buy and re-sell) carries significantly higher risks, because the market-maker can end up buying material that no-one else wants or selling valuable material at a loss because no-one is buying at that time (cf. Stovel & Shaw, 2012, p. 144). The deals arising from ideas-exchange in cultural production tend to be especially high because the creative arts rely on high-risk, high-reward innovation. Genre-shifting, mold-breaking ideas tend to emerge when ideas cross between different and distant networks, via weak ties (Granovetter, 1973). But weak ties can break down, due to differences of understanding or intention between parties to the exchange, much more easily than the strong ties between closer and more similar network participants. For each innovative success from successful exchange via weak ties (as when film-makers adopted new forms of special effects and animation, brought ‘method acting’ to the screen, or joined forces with computer games makers), there are many failures caused by the fusion of ideas breaking down or having bad results.

Buzz: ‘Performing Art’ in Global Media Value Chain GVC analysis has focused on the measurement of value in objects, goods, or services whose movements along the chain and changes in value can be easily observed. A broader perspective on the spectrum of novelty production (the core of the trend form of valuation) is needed to make sense of

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the phenomenon of ‘buzz’, participants’ own term for the experiential element that draws them into festivals, adding value to what they see there by enriching the context in which they see it. The extent to which cultural productions rely on network interconnections in production, and shared experience in consumption, requires a sociological approach that measures culture in people, objects, and social relationships as provided in a recent systematic research overview (Mohr et al., 2020). Cultural significance depends on the way objects are measured and interpreted, and what people do with them (cf. White & White, 1993). Objects can become ‘repositories of culture’—where culture is both an environment enabling ‘meaning-making as well as more specific forms like schema, scripts, or embodied practices’—and can also be repurposed and reinterpreted regardless of originators and be comprehended differently. Given today’s welter of goods, the significance of possessions has intensified but also shifted weight from collective to individual identity (on the ‘extended self’ see Belk, 1988). Enrichment with the collection form (see Chap. 4) adds—through curatorial and related work—to the expansion of measurements, and more objects as archival records and ‘traces of the past’ attain technical and valorizing agency. Later audiences make irreversible choices over which objects to retain and restore, leading to a bias in institutionally preserved culture that they identify—clearly, valuable for enrichment arguments. What remains, influences posthumous reputation (Lang & Lang, 1990). Mohr and colleagues usefully differentiate between emic (people’s) and etic (social researchers’) classification, allowing us to recall the lack of legal approaches in value chains (IGLP, 2016) that cultural objects and meanings attached to them, such as film styles, can also become subject of legal interpretation and media-copyright development (Joubert, 2023). Objects ‘in action’ (Mohr et al., 2020) can create resonance that can be measured by change in status, so becoming part of social relations. Patterned connections and exchanges make up networks, and dynamics in fields can be studied as relations. Preserved objects can complement newly produced ones by enabling purchasing at lower price points, and also compete with new ones in resale markets. The opportunity to resell objects second-hand raises the incentive to buy them (Scitovsky, 1994); unpopular products can also sell at lower ranks, in back markets—all this shifts economic activity to lower entrepreneurial risk-taking and the focus on market research, so slowing down innovation and shifting value creation toward consumption, with the possibility of the ‘imposition of a mythical majority taste’ and taste

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formation in the hand of business (Scitovsky, 1962, p. 248). Digital preservation, available in the twenty-first century, is a competitive challenge to the makers and performers of new artwork, countered by them with finding ways to keep preserved objects out of the market for new work, devalue the preservations (as out-of-fashion or just old) so that new work commands a premium, reinterpret the preservations negatively (e.g., as coming from a bad time), or invest new work with special elements—in itself, or in the ways it is experienced and ‘consumed’—that past work can no longer possess. Cultural Measurement Buzz has been posited as one of the structural elements of event production and commonly highlights what is productive in the excitement of being in a crowd and sharing in collective emotions (von Scheve & Salmelo, 2014; Collins, 2004). Its contribution to economic value goes beyond this. Following Shaw, we understand buzz as a case of emergent dynamics of socially constructed valuation, where individual valuation is posited as a process of learning under conditions of initial uncertainty (Shaw, 2020, p. 69). Mohr and colleagues’ synopsis on cultural measurement (Mohr et al., 2020) helps to briefly address some of the problems that arise from measuring buzz, related to consumer choice, consumer sovereignty, and atmospherically charged quality signals. The construct of buzz assumes that individuals alter their attitudes, behaviors, and subjective values in response to external social processes. Measurement of festival-goers’ attitudes that could be aggregated into buzz at some higher level is, however, fraught with problems and missing solutions (Burgess, 2020; Vogel, 2021), revealing weakness in terms of delivering on nonprofit mission for democratic film culture (cf. Elsaesser, 2005). As borne out by research and also relevant to information-­rendering market processes, people, for example, tend to misrepresent their own thoughts and intentions, often subconsciously, and their reports tend not to be stable over time (Mohr et al., 2020, pp. 23–24). Furthermore, externally driven alterations to attitudes and values may not always be positive, as shown by numerous negative studies of crowds and peer pressure (Mohr et al., 2020, pp. 23–24). Srivastava and Banaji (2011) demonstrate that people react faster, by automatic cognition, in sorting stimuli into categories when the associations are consistent with the implicitly held stereotypes. This applies, for example, also to situations relevant here such as

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when trying to absorb new knowledge about a new cinematic work and having to rate it. People’s interaction capabilities, based on this and similar research, are significant in value-adding processes as this implies that stereotype can be (and has been) used in valuation and value-adding processes of the media value chain, where both powerful and minor players in the CVC may (re-) produce stereotyping behavior, even in alternative ‘festival film’ production (Daldal, 2023; Falicov, 2016). Hu and coauthors (2023) demonstrate how stereotypes can be undone, attesting to the insight that culture is ‘appropriated’ and unpredictably remade. Gkritzali and coauthors (2016, p. 2331) discuss Paris as product location anchored in stereotypes, also illustrating the power of atmospheres and ‘place’. Not just place but even scent, as shown by Cerulo’s (2018) study of brand perfume associations, turns out to be a socially significant and emotionally powerful stimulus, related to class and race/ethnicity. Psychologists Luan et al. (2020) show that cues to judge quality (in this case of diamonds) taken in a sequence leads to better parameter estimation. These findings are applicable to the cinematic experiences and formal and informal judgments resonating with Karpik’s work on ‘unique value’ (Karpik, 2010). In a festival setting, people are confronted with much information during short periods of time (as well as over the short course of the festival). This may overload their cognitive processing and lead them to less accurate judgments of film and artist qualities. If the goal were being accurate, people like film critics and executives should find ways to digest relevant information more slowly and piecemeal. But this runs counter to the ‘logic’ of the curation which creates the conditions for buzz and subtly manipulates people’s experiences, being opened up to influences like critics, juries, curators, artists, press, and gossip. This underscores that people’s judgments can be easily swayed—and that to produce good judgments and to reduce the effect of manipulation, not just cognitive limits but also affecting practices (aesthetic heightening in goods, services, and communication) need more exploration (on recent color’s market positioning power see Sgourev et al., 2023). Emergent Dynamics of Socially Constructed Valuation One of the most sophisticated modeling projects potentially  informing future buzz studies—in application, providing rich insight into valuation processes of the enrichment economy—comes from Lynette Shaw (2020).

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She argues that even the most recent economic remodeling attempts, which acknowledge external influences on choice and understanding, still see value as not being intrinsically social—as market actors are just in the process of ‘finding out’. Individuals valuing the object begin in a state of uncertainty but with information coming in, overcome this initial state and approach better determinations of value. Information can be divided into nonsocial source of learning, even when transmitted through social channels with varying levels of fidelity (trusted source of knowledge), and information about other individuals’ valuations (regarding the object). The individual’s valuation typically includes both information as dependent and independent regarding others. This approach has immediate relevance for ‘valuation arenas’ such as festival events as both nonsocial and social learning sources are included in public event networks. These have been grasped qualitatively by Karpik as typology of personal and impersonal devices and the within-network market typology (applied to events see Vogel, 2023, pp. 133–158). Karpik’s merit is a heuristic that shows the breadth of valuation devices as related to conventions (Karpik, 2010). Continuing with Shaw, the learning mode can be of different pathways and also automatic associative processing (see above Srivastava & Banaji, 2011). This insight is relevant to ‘affective spaces’ such as festival sites, as a festival-goer, for example, can consciously or subconsciously develop a taste for a particular ‘fashion’ (the point of non-/declarative pathways of learning) and as automatic associative processing concerns the interdisciplinary debate on emotion on par with cognition, and ways of learning with immersion (Scheve, 2017). In Shaw’s Bayesian model (updating behaviors or decisions with further information being revealed at each turn), ‘fixed agents’ co-exist with ‘learning agents’ who arrive at valuation based on preexisting knowledge and, as the process continues, current signals (‘valuable’/‘not valuable’). They also act as social sources of learning, while the fixed agents are set up as operationalizing the realist perspective of inherent value, translating the idea of non-socially dependent value source (constant value for all fixed agents) on each simulation run. The learning agent bases her behavior on the current estimated value of the unseen parameter. This modeling approach appears to reflect well processes in cultural consumption and production, with trend being the dominant form of valuation, consistent with the highlighting of fashion in enrichment theory. Shaw’s experiment effectively simulates how a value emerges as stable from rounds of valuation with updated information.

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There are limitations to learning agents being modeled as ‘honest and non-strategic’. Learners may not tackle problems with real-world roles; for example commercial marketers in value chains may be unconcerned about the ways in which buzz works, judging it entirely by whether it drives up sales and profits. We also cannot assume that the taste-making roles from the ‘authenticity regime’ (Karpik, 2010) have such attributes, especially when external resource environments such as sponsors, governments, and philanthropists demand that audiences must be moved in a socially constructive direction that converges on the interests of the curators. This concern resonates with Shaw’s note on future modeling work where behavioral attempts to influence other ‘agents’ estimates’ are brought into the model. Interestingly, her study design also includes a proxy for real-­world intermediaries intervening in taste formation, built on Zuckerman’s ‘value entrepreneur’ (see in Sgourev, 2021, p. 1240), as she considers ‘highly confident though not necessarily correct actors on systems of collective valuation’ (Shaw, 2020, p. 73). Translating the intermediary as a change agent with a strongly held conviction into a strong prior, as she does, captures the idea of an agent providing spillover, such as sharing past experiences from a different group (exposure to curatorial ideas, for example, collected elsewhere, such as on festival travel, and highly typical for such ‘advisor’ occupations) and forming firm ideas of what the collective valuation of the underlying object should be. This would also work to proxy an agent that holds strong personal beliefs or commitments to steer others toward particular valuation, incorporating theoretically the idea of speech, stories, and narrative as cultural measurement in an emergent framework. Returning to more general questions of cultural measurement, this approach hints at the proposed ‘two types of culture in individuals’ (Mohr, 1998, p. 36). For buzz, the first is significant and actively encouraged by curatorial instruments such as daily festival gossip and press (see also Harrington & Bielby, 1995). Pragmatists claim that action not just carries culture (as asserted by sociological functionalism) but can carry meaning in its own right not traceable to existing meaning schemes. Being the equivalent to ‘producing meaning’ (as it is pragmatist), this potentially applies to event spaces precisely where even short-time action spaces can produce meaning that is conventionally counted toward socialization or habituation. Extending this pragmatist proposition, people then draw meaning from events just as they do from permanent artworks. In the enrichment economy, this would imply that with more trend available or accessible than collection, a structure of trend (eventization) is set in place.

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Michael Polanyi (2009 [1966]) related tacit knowledge to ‘practices as encoded in format’—so applicable to aesthetic-social formats the many cultural events represent. In this way, a praxeological perspective (Reckwitz, 2012; Schatzki et al., 2001) illuminates the power of events to contribute to chain integration, as discussed in the previous section (Rojek, 2013). It is also supported by cultural sociology, revealing with the concept of ‘schema’ that people seldom think via single beliefs and attitudes (Mohr et  al., 2020, pp.  25, 32–34). CVC practices (curation, brand-building, etc.) basically involve schemata as basic approach to building immersive environments, establishing networks of associations that can be dynamized by trend formation, propagated by eventization and intensified with digital infrastructure. Research on schemata as higher-order abstraction (than attitude, belief, and value—key concepts of culture research) is also relevant to understanding CVCs, as it shows that people with opposite attitudes or beliefs can still share a domain (seeing a relation between an X and a Y without necessarily agreeing on some vector of this relation). This recalls a long neglected research concept,  the ‘arena’ {Staruss, 1993). ‘Social worlds’ identify around a common core and agreement, or otherwise split and form new social worlds. Arenas form from social worlds, being stalemate-­ like structures, identifiable by a ‘going concern’ (Hughes, 1993) but never resolving conflicts. (The concept of the ‘multipolar value chain’ applied to the biofuel value chain (see in Ponte & Sturgeon, 2014, p.  215) is the economic representation of such an arena.) Applying Shaw’s results more broadly to festival buzz, it could mean that what happens early in an imagined process of buzz formation and is basically noise (in absence of a stable inherent value of an object, which is mostly the case regarding novelties and talked up uncertainty through ‘surprise rhetoric’) may matter more than whatever else has been said about buzz or value-added from festivals (Burgess, 2020). So, in extension, buzz can be studied as to how ‘influencers’ serve as early signals that in the end do not turn out the sources of the right guesses once the emerging system has converged. Shaw’s results resonate with cultural measurement ideas of ‘microactions’ that can become a micro-order component of CVC buzz. Microaction research concerning buzz is a fruitful additional research direction to the study of the ‘big’ collective emotions of mega events, festivals, and angry protest, mostly jotted down in social movement research, adding the more subtle emotions (von Scheve & Salmelo, 2014).

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Microactions are “lines of activities that occur at very restricted temporal scales”, or ‘micro versions of behavioral patterns’ (Mohr et al., 2020, p. 52). If deeply ingrained in habits, the observed person may not notice them, and they also may be hard to capture externally, but they can aggregate up to larger social patterns (such as ‘collective effervescence’). Not surprisingly, microactions are the area of Big Data based research that shares a ‘research interest’ with cultural sociology on evaluation, boundary-­ drawing, categorization, decision-making, and affiliation. Sociologists try to understand “how the accumulation of many small microinteractional moments shapes highly uncertain situations. Shaw’s results also underscore the significance of buzz as it appears to show that socially originating information will not be disappearing even where nonsocial information (Karpik’s impersonal devices) can be utilized in reducing uncertainty about an object’s value or quality. Social information’s presence ‘can fundamentally alter the dynamics of collective valuation’ (Shaw, 2020).

Conclusion This chapter examined the process of value capture by which some firms in a production chain can secure (as additional income) value created or stored elsewhere. We provided insight into a third form of rent—Ricardian rent—sighted in CVCs. Discussing extraction and capture, intangibles, value capture, and sustainability returned us to the neglected role of power in networks and clusters, which moved us to the hypothesis that events can concentrate and facilitate chain integration. Using network theory of brokerage, we asserted that the much observed fragility of cultural events, such as film festivals, is associated with a process of stabilization by grafting onto the nonprofit form. Our hypothesis and the tentative explanatory set of arguments via brokerage theory indirectly support Witesman’s argument on ‘sectorial research’ bias (see Chap. 6). The final section offers ideas on the measurement of culture as broader approach to valuation as well as specific to buzz, the key intangible asset of the festival event.

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CHAPTER 8

Conclusion and Future Research Direction

Abstract  This book presents an analysis of cultural value chains (CVCs), the connected processes generating value in ‘creative’ industries that command an increasing share of national output and employment. It combines relevant knowledge from more extensively researched global value chains (GVCs) with new economic and sociological insights into valuation, enrichment, nonprofit chain-integration, the capture of rent via social networks, festivalization as a defence against the rising relative cost of artistic performance, and the co-realization of cultural value through producerconsumer interaction. Empirical evidence from film festivals is used, alongside a critical analysis of cultural-cluster impact studies, to assess competing theories and develop a framework for future CVC analysis. Keywords  Smile Curve • Scowl Curve • Eventization • Rentierism • Digitization • Globalization In this book we have argued for the need to rethink, for the twenty-first century, a global value chain (GVC) analysis that relies heavily on observations of the standard form, the Smile Curve, and global manufacturing processes. While these are key to the way economic development operates across the world, it has also been shown that knowledge and cultural production behave quite differently, converging toward each other based on commonalities and the dogma of creativity (Reckwitz). We therefore put © The Author(s), under exclusive license to Springer Nature Switzerland AG 2023 A. Vogel, A. Shipman, Film Festivals and the Enrichment Economy, https://doi.org/10.1007/978-3-031-33501-3_8

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ourselves on the path of critical GVC scholarship, sociology of valuation, and the theory of the enrichment economy to provide an analytic framework for the study of cultural value chains (CVCs). Our analysis of cultural supply chains and integrated consumption spaces—such as events—has affirmed the characteristics of cultural value that enmesh its determination in networks (among organizations and individuals, including audiences), and dispose cultural products toward network-based trade. It has noted the scale on which creative activity can generate rents, some of a type familiar in other industries’ GVCs and some specific to the arts. And it has recognized the imbalances of power within the chain, especially between its unusually large nonprofit elements and the more profit-driven, which enable the capture and redistribution of these rents. This book provides new claims that we hope will encourage lively debate, as it points away from platforms as the major source of chain integration, and toward the event as a curated immersive environment coupled with, or as we prefer in adoption of brokerage terminology, organizationally grafted on a voluntary redistributive exchange device, which we uniquely identify as the nonprofit entity. Experience-based culture, we have argued, defies commoditization by creating a spectacle that requires ‘being there’, ‘in the moment’, not replicable by broadcasts or recordings. In principle, immersion overcomes the problem of rising cultural performance cost (part of the ‘Baumol effect’) by ensuring a proportional rise in audiences’ willingness to pay at least in line with rising cost. To maintain this advantage in attracting audiences, alongside their unique role linking creative producers in value networks, events must continually innovate to offer immersivity of a kind that  recording, broadcasts, and simulations cannot match. In particular, we highlight the role of festivals as sources of added value, contributing to the enrichment of audience experience (in and beyond creative and cultural sectors), and in connecting key players on the production side. We have advanced the case that the festival event is a nonproprietary type of a chain integrator, based on constitutive power, working as a club or toll good, and being enabled in its current form by the grants economy that funds the operational base of the arts nonprofit in public and private means as well as creates depends on grants and sponsorship competitions. When under private-sector or nonprofit management, and staged in a commercial venue, the festival constitutes a ‘consumption club’ that takes over from fully public entertainment space. This can help it to

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overcome the problems that arise from replicable artwork becoming a public good (impossible to charge for because of non-excludability), and artistic performance becoming a scarce resource that degrades when too many try to access it. But it limits the extent to which festivals can provide the forum for communication and free expression that public broadcasters, public squares, maybe even state-funded schools and universities, under financial pressure, now struggle to provide. This further tension on the festival, pitching public purpose against private profit, rises in importance as the public realm becomes further restricted. In cultural industries, audiences cocreate value with creative artists and artistic performers. Analysts of GVCs have long recognized that they exist in an ‘ecosystem’ that includes customers, so buyers combine with suppliers in the co-realization of value (Collins & Murphy, 2010). But in cultural chains, audiences are involved in the cocreation of value, conferring it on objects and performances that have no inherent value until they are recognized as art. This leads to the central role of festivals in artistic performance presentation, and of exhibitions and other collections that play a functionally similar role in the presentation of creative artifacts. Festivals are centered on audiences, as the target of their programs and their most numerous participants, in contract to multilateral gatherings in other industries that are typically confined to production-side representatives. The one exception—high-technology sectors’ ‘trade fairs’ where expert buyers and customers are a big presence—reflects the rising creative component in tech-based industries, where—as in the arts—user reactions can make or break a product regardless of its inherent technical merits. We have argued that the eventization of the cultural value chain provides important inputs into the more global media value chain that is especially stretching and expanding as digital technologies reform classical media, innovate new ones, and build on protective intellectual property (IP) regimes and company and commercial law so the big platforms reap the benefits. This does not exclude in our view that events have become the value location of investment and are drivers of cultural excess and that indeed they are fragile brokers in the complexity of the creative value complex. We have also provided arguments as to why the event as a chain integrating platform is homologous to proprietary platform companies in the global media value chain. Events are not the minor cause in a system that produces highly unequal outcomes, a few winners relative to many losers. The way they are built and the way cocreativity has been valued and prescribed today, its specific

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forms replacing old forms of cocreativity (just as theorized by Reckwitz with the creativity dispositif) are observable phenomena that, as they sort and classify, stimulate creativity, discover novelties, also create more uncertainty, which does not lead to more equality and more security for the many artists. Events survive partly by taking steps to contain the rise in cost (especially via economies-of-scale from inclusion in festivals, and using volunteers to keep down festival labor costs), and partly by enhancing the experience to justify higher costs when these are passed on in higher prices. We have demonstrated that widely increased and dispersed immersive curations insert more uncertainty in the process that is not just of economic kind but has social consequences for the livelihood of artists. Apart from suggesting artist exploitation with the concept of the artistic rent, we proposed two further important ways of rent-seeking and value capture in the cultural value chain: exogenous and Ricardian rent. Festivalization, the widely observed reorganization of artistic performance into aggregated and curated events, and clustering, the equally common spatial concentration of physical artwork production, both harness cost-reducing ‘scale economies’ on the production side as well as creating additional value for audiences that induces them to pay a higher price. But our analysis has also emphasized the defensive nature of festivalization, as a consequence of live performances becoming increasingly important for artists’ income generation while also being increasingly expensive to stage. The ‘Baumol effect’ of differential productivity growth creates a widening gap within the industry between creative artifacts that can be archived and digitized (which can be replicated, like mass-produced goods), and artistic performances that are singularities (delivering an experience for an audience) that cannot be stored or directly reproduced for people who are not ‘where it happens’ at the time. Artistic performances—at live events—rise in cost compared to digitally recorded and transmitted performances, which can be replicated with increasing productivity. The modern pervasiveness of big and small screens, giving increasingly ‘authentic’ audiovisual replication and augmentation in two or even three dimensions, has fueled a ‘cinematization’ of other art forms—measurable in the way that books, plays, music, visual art, and even computer games can jump in economic value when adapted for or featured on screen. A question still arises over how far our conclusions on film festivals are generalizable to other sectors. Regular film screenings are sold at a standard

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price, giving a possible baseline for measuring the value added when a showing is ‘eventized’. But cinemas and theaters have reacted by turning each ‘regular’ program slot into more of an event, by upgrading their venues to embellish the experience around the screen, and interrupting the regular cycle to host festivals of their own. Is that a pattern that other public arts spaces have tended to follow, especially as they face post-­ pandemic audiences, is a fruitful question for a comparative research direction we think is dearly needed. Finally, we want to emphasize that we hope to bring closer together GVC and cultural economic analysis, not trying to compartmentalize cultural from other production. The teasing out of similarities and differences surrounding enrichment and manufacturing areas of the global economy has led us also to more insights into structural processes like globalization. Looking at clustering versus spatial expansion, we have established that time–space compression—the driving  principle of globalization—has many forms. The conventional view is that GVCs, especially now with digital value networks maximize spatial flexibility, including upgrading, offshoring, and disarticulation mechanisms as GVC analysts have revealed. In our view, the CVC includes two rounds of time–space compression, first through eventization—the contraction of cultural valuation time through the event and its suspension of slower processes bound by cognition and judgment being overlayered by ‘valorization spectacle’ as immersive environments triggering affect and emotion more than judgment—delivering the buzz. Second, the buzz is a time–space compression in that it is channeled through digital pathways (critics, reviewers, influencers all incorporated into the chain). Following Baglioni and coauthors (2021), this is a double process of Schumpeterian ‘creative destruction’ and momentary interruption of the production process, but also Veblen’s standardization—a combination of business and machine process. This returns us to take a look at our Scowl Curve proposition and how further digitization plays out for the global economy. There is a relationship between identifiable sites of the middle of the curve, such as relations between events and places that they hybridize by their atmospheric cocreativity (De Molli et al., 2019). Rather than thinking of enrichment as a separate economic space, it makes sense to see Scowl and Smile Curves interlaced. For the first, clusters, the spatial fix, creative contagion and valuation forms like collection and trend are the major concepts to perform value chain analysis, keeping in view that cultural performance is a

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chain-integrating phenomenon currently shaped as events and resourced on nonprofits. For the second, the media value chain, the spatial flexibility—where manufacturing, non-digital, and digital are involved, and especially data work as shown by Howson et  al. (2022). Taking socio-legal reality into account, we add key concepts such as standard and asset form to this type of chain. There are the nonprofits or marginally profitable companies for which the workers and volunteers do their work, including any live performances and venue-based exhibitions. The platforms are the digital channels that record and transmit these products to consumers. Consumers pay the platforms and the companies. The companies underpay the workers, and the platforms collect rent from the workers and/or the companies they work for. This rent is received directly, by fees that the companies pay to the platform (or that the worker pays to the platform if it transmits their home-produced material, as with Youtube and Tiktok). Platforms also extract rent indirectly—when they receive payment from customers (e.g., a Netflix subscription) and don’t pass all of that through to the workers or the companies they work for; or when they receive free content from workers and take fees from the customers who receive it, along with revenue from the advertisers who put their ads on it. These are just some of the more obvious ways in which network configurations allow rents produced in the value chain to be redistributed and captured. The companies named in our examples might rise and fall as technologies move forward, but the flow of artistic rents will continue, enabled by nonprofit intermediaries in their inherently fragile brokerage role. More work is needed to distinguish the types of curves applying theoretical concepts like asset, collection, standard, and trend form to valuation dynamics, understanding where rentierism emerges in competing or coexisting scenarios. The flow of rents from global South to global  North in globalized manufacturing and services, enabled by the hierarchical division of labor that follows from Smile Curve outsourcing (Aguiar de Medeiros & Trebat, 2017) has raised justifiable concerns over the distributional consequences of GVCs. In CVCs, the hierarchical division keeps most ‘creative’ work in the global North, but still allows extraction of social rents that squeezes the pay of most cultural workers. If taken too far, this value capture also endangers the survival of nonprofit organizations that are vital connectors for new creative projects. The conversion of self-employed artists into ‘cloudworkers’, competing globally on terms now set by centralized

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platforms (Howson et  al., 2022), spreads the potential for exploitation across both hemispheres. It heightens the challenge of keeping culture affordable to the broadest audience, without starving the workforce that creates and sustains it.

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Index

A Aesthetic mobilization, 52, 83 Affordance, 27 A-list/B-list, 70 Archive, 9, 48, 51, 64, 69 Arranger, 67, 82, 137 Artistic rent, 2, 7, 10–12, 74, 92, 93, 102–108, 112–114, 116, 119, 128, 130, 139, 158, 160 Arts administration, 3 Asset, 8, 20, 24, 25, 50, 51, 62, 64, 65, 68–74, 81, 102, 107, 128–132, 138, 147, 160 Atmosphere, 11, 82, 83, 85, 136, 143 B Baumol effect, 4, 5, 81, 120, 156, 158 Brokerage, 136, 139, 140, 147, 156, 160 C Class, 20, 42, 59, 67, 71, 85, 143

Cloud work, 93 Club good, 87, 110–112, 139, 140 Cluster, 12, 21, 22, 31, 32, 44, 45, 89, 90, 96, 102, 103, 115–117, 119, 120, 128, 131, 147, 159 Cocreation, 87, 157 Collection, 8, 12, 48, 51, 52, 58, 62, 65–73, 81, 83, 88, 94, 95, 111, 132, 134, 138, 141, 145, 157, 159, 160 Common resource, 110, 139 Co-production, 45, 107 Creative art, 11, 40, 47–49, 66, 82, 87, 106, 110, 132, 140 Cultural heritage, 64, 130, 138 Cultural value, 5–8, 10, 12, 27, 40, 61, 128–133, 156 Cultural value chain (CVCs), v, vi, 2, 4, 7, 9–12, 18, 22–29, 31, 40–54, 58–60, 66, 68, 71, 72, 74, 80, 82, 83, 129, 130, 133–135, 138, 143, 146, 147, 156–160 Cultural work, 7, 80, 92, 119

© The Author(s), under exclusive license to Springer Nature Switzerland AG 2023 A. Vogel, A. Shipman, Film Festivals and the Enrichment Economy, https://doi.org/10.1007/978-3-031-33501-3

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188 

INDEX

D Depletability, 110 Digitization, 4, 8, 59, 64, 70, 91, 107, 110, 111, 129, 159 Disarticulation, 159 Driver, v, 20, 30, 32, 52, 102, 157 Dyad, 25–28 E Enrichment, vi, 8–10, 12, 19, 22, 57–74, 88, 91, 102, 130, 132, 135, 141, 143, 145, 156, 159 Eventization, vi, 4, 7, 8, 67, 74, 80–96, 102, 128, 145, 157, 159 Excludability, 107 Experience, v, vi, 2, 4–6, 12, 46, 49–53, 59, 64, 66, 68, 74, 80, 82, 83, 85–87, 92, 93, 95, 106, 110, 132, 139, 141, 143, 145, 156, 158, 159 Experience goods, 4, 86 Experience-seeker, 81, 82 Experience value, 52 F Fan, 110 Festival, 8–10, 12, 58, 59, 64, 67–72, 74, 80–82, 85–87, 89–96, 103, 106, 108, 109, 111, 112, 116, 117, 120, 128, 134–141, 143–147, 156–159 Festivalization, 80, 86, 88, 158 Field-configuring event, 92 Film, 2, 6, 9, 10, 12, 31, 43, 45, 48, 50, 58–60, 62, 68, 69, 71, 73, 74, 82, 90–91, 103, 107, 113, 116, 120, 130, 131, 135–138, 141–143, 147, 158 Format, 33, 49, 58, 59, 67, 70, 85, 87, 93, 135, 138, 146

G Globalization, 45, 159 Global North, 44, 61, 160 Global South, 41, 44, 61, 64, 160 Global value chain (GVC), vi, 5, 10, 11, 18–33, 40, 41, 44–46, 52, 53, 60, 65, 72–74, 102, 103, 105–107, 119, 128, 133, 140, 155–157, 159, 160 Grants economy, 156 H High/low culture, 81 I IMDb, 135 Immersive environment, 4, 8, 11, 74, 128, 135, 146, 156, 159 Impresario, 6, 83, 111, 119 Independent cinema, 135 Indie, 135 Industrialization, 61, 105 Industry classification, 40, 91 Infinite variety, 70, 71, 86 Innovation, 19, 24, 30–32, 43, 49, 63, 86, 93, 96, 102, 103, 114, 140, 141 Intangible, 20, 21, 24, 25, 29, 50, 61, 62, 82, 92, 128–132, 147 Intellectual property (IP, regime), 3, 4, 6, 8, 41, 43, 64, 65, 68, 119, 120, 157 Intermediary, 6, 9, 50, 53, 60, 61, 70, 73, 113, 118, 135, 145, 160 Isomorphism, 26, 27 J Jury, 143 Justification, 28, 62, 73

 INDEX 

K Karpik, Lucien, 5, 27, 45, 58, 60, 64, 65, 117, 143–145, 147 L Labor market, 22, 107–109, 112 Law, 19, 20, 33, 51, 67, 109, 157 Leisure, v, 67, 86 Luxury, vi, 62–64, 66, 70, 73 M Mainstream production, 20 Management (arts), 12, 67, 118–119 Market-maker, 20, 140 Market-organizing, 9 Media, v, 7–9, 12, 18, 31, 46, 50, 52, 58–60, 64, 66–69, 71, 74, 81, 85, 87, 91, 106, 107, 109, 114–119, 129, 133, 138, 140–147, 157, 160 Mega events, 146 Monopoly, 20, 22, 30, 31, 60, 102, 103, 132 Monopsony, 20, 22, 41, 132 Multiplier effect, 88, 96 Museum, vi, 43, 64, 69, 83, 88 N Network good, 96 Network market (Karpik), 27, 96, 144 Nonprofit, 3, 7, 9–12, 29, 33, 43, 51, 58, 60, 64, 68, 71, 85, 91, 93, 102, 106, 108, 109, 111–114, 116, 119, 120, 128, 135–140, 142, 147, 156, 160

189

O Object, 2, 6–9, 12, 18, 19, 25, 27, 42, 46–50, 60–65, 67, 69–74, 80, 82, 83, 95, 112, 130, 140–142, 144–147, 157 Organizational grafting, 137, 139–140 P Patronage, 51, 60, 72 Personal network, 94 Philanthropy, 3, 119 Platform, v, 59, 81, 82, 111, 120, 130, 134, 135, 137, 138, 156, 157, 160, 161 Positional good, 71, 95, 108 Postmodern art field, 82 Power, v, 2, 3, 6, 7, 9, 11, 12, 18–33, 40–42, 53, 54, 67, 69, 80, 91–94, 103, 107, 108, 113, 114, 117, 128–147, 156 Praxeology, 146 Precarity, 106 Producer-driven commodity chain (PDCC), 20 Programming (in festivals), 68 Public good, 51, 93, 94, 107, 109, 110, 139, 140, 157 Q Qualification, 11, 28, 29, 32, 60, 117, 134 R Rent artistic, 2, 7, 10–12, 52, 74, 93, 102–108, 112–114, 116, 119, 128, 130, 139, 160 endogenous, 30–32, 103, 114

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INDEX

Rent (cont.) exogenous, 12, 31, 32, 64, 103, 114–120, 128, 139, 158 market, 31, 103, 114 natural, 30, 103, 114 social, 108, 112–114, 120, 128, 160 Rent-seeking, 30, 32, 72, 158 Reputation, 28, 50, 68, 141 S Scale economies, 69, 158 Scowl Curve, 10, 12, 40–42, 45, 52–54, 107, 159 Securitization, 69 Singularity, 27, 45, 47, 53, 64, 70, 71, 84, 117, 158 Singularization, 45, 70, 71, 84 Smile Curve, 10, 12, 40–42, 46, 53, 155, 159, 160 Social capital, 12, 25, 27, 42, 50, 117 Spectacle, 72, 86, 87, 107, 156 Superstar effect, 5, 7 T Tech-giants, 63 Television, 2, 6, 43, 60, 68, 74, 113, 138 Theatrical exhibition, 58 Theme park, 130 Tiers in festival network, 10, 91, 92, 96, 138 Toll good, 72, 91, 112, 120, 156 Trade fair, 157 Training, 3, 31, 50, 89, 103, 115 Trend, 4, 7, 8, 12, 48, 51, 58, 59, 62, 65–67, 70–73, 81, 83, 95, 116, 132, 138, 140, 144–146, 159, 160 T-shirt as reward, 129

U Uncertainty, 27, 112, 119, 142, 144, 146, 147, 158 UNESCO, 64, 130, 131 Unique value, 81, 143 Upgrading, vi, 19, 20, 32, 159 V Valorization, 40, 58, 71, 85, 86, 129, 159 Valuation, 2, 4, 5, 8, 9, 11, 12, 18, 19, 28–29, 32, 40, 42, 51, 58, 60–62, 64–66, 68–73, 81–83, 85, 95, 128, 135, 138, 140, 142–147, 156, 159, 160 Value-added, 2–7, 9, 12, 18, 19, 40, 41, 43, 45, 52, 54, 59, 62, 64, 74, 80–96, 116, 131, 146, 159 Value capture, 12, 33, 51, 106, 128–133, 135, 136, 147, 158, 160 Value chain, vi, 2, 3, 8, 9, 11, 12, 18–20, 23, 24, 26, 27, 29, 31–33, 40–43, 45, 52, 53, 58–60, 63, 66, 68, 71–74, 80, 81, 83, 85, 89–92, 94, 95, 105, 106, 111, 112, 114–119, 132–137, 139, 141, 143, 145, 146, 157, 159, 160 Value network, 12, 45, 80, 94, 156, 159 Vertical integration, 20, 24, 133 Volunteering, 111 W Weak ties, 118, 137, 140 Welter, 67, 70, 141 Withoutabox.com, 135