The Cultural Economy Moment?

Professor Terry Flew, Media and Communications, Creative Industries Faculty, Queensland University of Technology

Keynote

Presentation

to

Media

Technologies,

Community and Everyday Life, symposium hosted by the Centre for Everyday Life, Murdoch University, Perth, WA, 2 September 2009

My presentation today will focus upon the rise of the term cultural economy in the 2000s, and some matters arising about the relationship between both culture and economy as fields of research and study, and cultural studies and economics as academic disciplines that seek to understand and intervene in these fields. When I refer here to cultural studies, I am not seeking to engage in the long process of defining what cultural studies is (or is not), nor am I seeking to sharply differentiate cultural studies from media studies or communication studies. Rather, taking a broad definition of the field, I will argue that it has been constituted at least in part by an opposition to how it understands economics as a discipline to be constituted. This is seen most clearly in the current context in the way in which neoliberalism is invoked as a term to signify what thinking in terms of economic discourse entails, as well as a critique of its deleterious effects when applied to the field of public policy. One of the points I want to make is that economics as a discipline is in fact far more porous and pluralist than this one-dimensional interpretation of it would suggest, and this emerges in interesting ways when there is consideration of those parts of economics as a discipline that may bear upon an understanding of culture. In keeping with the theme of todays symposium, I will draw upon examples relating to digital media technologies and their everyday uses by people and communities where possible.

The Rise of Cultural Economy: Intellectual Precursors

Although the term cultural economy dies not gain widespread currency until the 2000s, there is considerable work undertaken since the 1970s that invokes a relationship between culture and economy. Herbert Schillers pioneering critique of international communications posited a relationship which Schillers work adhered to over a 30 year period between the rise of the media entertainment and informationbased industries (what he termed the Entertainment-CommunicationInformation (ECI) Complex) to the centre of the United States economy, and the extension of global media and communication industries, systems and ideologies as an instrument of cultural domination on non-Western societies and cultures. While the resulting cultural imperialism thesis has been widely critiqued, it retains considerable influence worldwide as seen, for example, in the statement of the World Commission on the Social Dimension of Globalization in 2004: The fear is that constant exposure to the images of Western lifestyles and role models could lead to tensions which would be both culturally and socially divisive (World Commission on the Social Dimension of Globalization, 2004: para. 222). There is also the small sub-branch of economic known as cultural economics. Cultural economics has operated to some extent at the margins of economic theory, largely unable to challenge the utilitarian assumptions of mainstream neo-classical economics nor able to build bridges to the arts and humanities, so it has frequently operated as an applied sub-discipline concerned with assessing the impact of public subsidy to the arts and cultural activities. It is interesting to consider how it seeks to clarify what distinguishes the cultural domain from other areas in terms of its goods and services, its criteria of value, and its delineation of industries and markets. In his overview of this filed, Throsby (2000: 4) proposes a definition of cultural activities as being those: involving some form of creativity in their production; concerned with the generation and communication of symbolic meaning; and whose output embodies, at least potentially, some form of intellectual property.

3 One notable feature of the cultural economics literature is that it is far less anxious bout whether the resulting industries are labeled cultural or creative industries than is the case in cultural studies and related fields. This is because industry analysis is, from the point of view of economics, is simply a convenient box of tools for representing and analyzing the way in which the processes of production, consumption and exchange occur for given commodities (Throsby, 2000: 111). At the same time, in his recent overview of the variety of competing models of what the cultural or creative industries are, Throsby has observed that one consequence of talking up the economic significance of cultural or creative industries has been to shift cultural policy thinking so that it is rescued from its primordial past and catapulted to the forefront of the modern forward-looking policy agenda, an essential component in any respectable economic policymakers development strategy. This is because the arts can [now] be seen as part of a wider and more dynamic sphere of economic activity, with links through to the information and knowledge economies, fostering creativity, embracing new technologies and feeding innovation (Throsby, 2008: 229). A third and less obvious inspiration for cultural economy discourse was postmodernism, particularly as it was developed in the early work of Jean Baudrillard (Poster, 1994). Baudrillard argued that a feature of contemporary capitalism was that the distinction between use-value and exchange value that Marx saw as defining the nature of the commodity form was less and less relevant to consumer society where both were subsumed under the more general category of sign-value. Rather than moralizing against the inauthentic nature of, say, entertainment at a theme park as a poor substitute for real culture or entertainment, Baudrillard instead proposed the negative strategy of celebrating the theme park as a simulacrum of the real, or the hyperreal of postmodern culture. While the impulse to link Baudrillard to political economy was one that in practice not many followed, a notable series of contributions that draw upon Baudrillards insight have been made by Scott Lash and John Urry (Lash and Urry, 1989; Lash and Urry, 1994; see also Lash, 2004). For Lash and Urry, Baudrillardswork hints at a series of developments - the semiotisation of everyday life, reflexive accumulation, niche consumption leading flexible production whereby it is not the case that culture is being increasingly industrialized, but rather that the whole economy is being increasingly culturalized:

4 Even in the heyday of Fordism, the culture industries were irretrievably more innovation intensive, more design intensive than other industries Our claim is that ordinary manufacturing industry is becoming more and more like the production of culture. It is not that commodity manufacture provides the template, and culture follows, but that the culture industries themselves have provided the template (Lash and Urry, 1994: 123).

More obviously connected to contemporary theories of cultural economy are those works that developed the sociology of culture in the 1970s and 1980s. Pierre Bourdieus work is highly significant here, particularly Distinction (Bourdieu, 1984). In positing a relationship between cultural consumption and the reproduction of social class relations, and in proposing that this occurred at least in part through the denial of material concepts such as that of class being relevant to the domains of art and culture, Bourdieu established a relationship between the distribution of economic capital and that of cultural capital which places socio-economic relations at the heart of considerations of culture. In championing Bourdieus work as a contribution to the sociology of culture, Raymond Williams and Nicholas Garnham observed: The cultural field serves as a marker and thus a reinforcer of class relations for two reasons. First, because a field occupied by objects and practices with minimal use-value, is a field in which par excellence the struggle is governed by a pure logic of difference or distinction, a pure logic of positionality. Secondly, because the creation of art as a special social object and practice, defined by its difference and distance from everyday material reality and indeed its superiority to it, objectively depends upon the distance from economic necessity provided by the possession of economic capital (Garnham and Williams, 1986: 124).

5 Finally, there is the work of Nicholas Garnham, whose contribution has been central to British traditions of thinking about cultural economy, but whose work has led in two quite distinct and possibly contradictory directions. In general, Garnhams approach to the political economy of media and culture has been one that insists that the development of capitalism has involved the industrialization of culture, so that it does not make sense to think in terms of culture as superstructural forms (as in theories of ideology, for example), but to instead consider the dynamics of cultural industries in terms of the general forms and practices of capitalist commodity production. This in turn shaped Garnhams famous critique of what he termed the left-pessimist approach to cultural policy, with its focus upon residual cultural practices and the state-subsidised arts, and influence that such work would have upon later developments in British cultural policy and the development of creative industries (OConnor, 2007). Garnham called for a shift in progressive cultural policy thinking towards the commercial cultural industries, arguing that:

Most peoples cultural needs and aspirations are being, for better or worse, supplied by the market as goods and services. If one turns ones back on an analysis of that dominant cultural process, one cannot understand either the culture of our time or the challenges and opportunities which that dominant culture offers to public policy makers (Garnham, 1990: 155).

At the same time, while Garnham was highly critical of non-market allocations of cultural resources which create dependency relations between cultural workers and cultural bureaucrats, and was applying techniques of conventional economic analysis to the British television industry (Collins et. al., 1987), he was also drawing upon Jurgen Habermass theory of the public sphere to establish a different way of

6 dichotomizing the market and non-market sectors of cultural production. This was seen in his normative distinction between public service broadcasting the BBC in the British case - and commercial media, on the basis of the former addressing the community as citizens, and the latter dealing with the audience as consumers. While Collins (2004) and Jacka (2004) have argued that this normative account of public service broadcasting has in practice provided a poor guide to what public broadcasters have done in practice, it nonetheless instituted a distinction between the citizen and the consumer, and the argument that addressing media audiences as consumers was somehow impoverished in comparison to addressing them as citizens, that developed a tenacious foothold in media policy debates over the 1990s and 2000s (Flew, 2006).

Contemporary Theories of Cultural Economy

There exist a range of antecedent approaches that point towards the rise of cultural economy as a concept in cultural studies and related fields. I now want to consider five ways in which the concept has been developed in the 2000s. The best known of these in Australia would be though the concept of the creative industries, which has been the subject of ongoing debate since the Queensland University of Technology established a Creative Industries Faculty in 2001, and the association of high profile cultural researchers such as John Hartley and Stuart Cunningham with the Australian Research Councils Centre of Excellence for Creative Industries and Innovation (Hartley, 2005; Flew, 2008: 168-192). Creative industries has also been associated with a range of policy initiatives worldwide, ranging from the creative industries mapping documents of Britains Department of Culture, Media and Sport in the late 1990s (DCMS, 1998), to the analyses developed through the United Nations Commission for Trade, Aid and Development (UNCTAD) and others on the opportunities presented by creative economy strategies for developing countries (UNCTAD, 2008; Barrowclough and Kozul-Wright, 2008; Cunningham, 2008). But its important to be aware that the concept of cultural economy has been in operation often when it has not been named as such. One of the best accounts of such developments worldwide is found in George Ydices The Expediency of Culture (Ydice, 2003). Ydice develops the concept of culture as resource, arguing that in early 21st century global capitalism culture is increasingly wielded as a resource for both sociopolitical and economic amelioration, that is, for increased political

7 participation in an era of waning political involvement, conflicts over citizenship, and the rise of cultural capitalism (Ydice, 2003: 9). This involves culture being increasingly viewed as a social resource, performing a variety of functions, ranging from redressing social marginalisation to promoting community behaviour more conducive to economic growth, from public investment in festivals and events that promote local tourism to energising otherwise dormant well-springs of creative energy, and with such demands impacting upon the conduct of contemporary cultural institutions at all levels. Manifestations of culture as a resource can be seen with: the need to develop economic rationales for arts and cultural funding; the growing recognition of social capital as a factor in economic development; the rise of the creative industries based upon wealth generation through new ideas and intangible assets; the uses of culture in urban promotional strategies; and growing demands on the part of minority groups for cultural rights and recognition of cultural citizenship. The growing interest on the part of governments and other institutional actors to deploy culture as a resource has coincided with a growing interest in the business literature in culture as a variable in economic performance. New management literature makes much of the need to diagnose the culture of organizations in order to shift the relationship between artifacts, values and deep cultures to initiate and manage change (Clegg et. al., 2005), while to work on competitive strategy associated with Michael Porter implicitly draws upon cultural variables in the rise of economically successful regional clusters (Porter, 2000). This work has been picked up on by social scientists in Britain associated with the Journal of Cultural Economy, which describes its aim as being to understand the role played by various forms of material cultural practice in the organisation of the economy and the social, and of the relations between them (Journal of Cultural Economy, Aims & Scope). In their founding text on cultural economy, du Gay and Pryke (2002) associated a growing culturalization of the economy with such factors as:

8 1. Arguments that the management of culture has become the key to improving organizational performance, particularly when there is an alignment between organizational goals and the values and attitudes if those working within them; 2. The rise of the service sector, where the relationship between economic transactions and their performative or cultural dimension through interpersonal relations and communicative practices are more overt and visible; 3. The rise of the cultural or creative industries, and the spread of practices throughout the economy that have their genesis in these industries, such as a premium being placed upon design, the role of cultural intermediaries in channeling consumer demand, and the role played by networks in time-based and project-based production activities. A question raised by this work is whether, as Don Slater has observed, we are conflating a greater conceptual awareness of the need to think about culture and economy in tandem rather than separately, with a different empirical claim that cultural factors have become more important in contemporary capitalist economies: There is the constant danger of confusing new movements within thought (the new understanding that culture and economy cannot be theorized separately) from new empirical developments. Is it the case that culture is actually more central to economic process than it was before? We need to develop more adequate theories of the sociology of economic life rather than proclaim epochal social revolutions that are merely the artefact of the inadequate theories and theoretical division of labour we have inherited (Slater, 2002: 76).

Amin and Thrift has historicized the concept of cultural economy, noting significant contributions going back to Adam Smith, Karl Marx

9 and ThorsteinVeblen. They argue that The production, distribution and accumulation of resources loosely the pursuit of prosperity has always been a cultural performance [but] with the rise of a separate profession of economics and a set of specifically economic knowledges, such performance has either been neglected or actively denigrated (Amin and Thrift, 2004: xii). They trace three stages in cultural economy debates. The first, associated with neo-Marxists such as Sayer (1997) proposes that while the cultural and the economy increasingly intersect, they need to remain analytically separate realms, based around the distinction between the interpretative and the instrumental, or, put differently, between abstract and calculable regimes of value. Second, there is the synthetic model associated with authors such as du Gay and Pryke, where culture and economy are increasingly overlapping realms, with each transforming the other as they become more intertwined. The third approach, which they associate with actor-network theory, questions this way of ordering the debate, noting that all of the key categories of economic theory markets, industries, goods and services are formed through processes that are simultaneously cultural and economic, as well as being shaped by law, politics, regulations and science. To give one example of how this works in practice, Callon et. al. (2004) have argued that one of the features of what is sometimes referred to as the new economy is that consumers are themselves increasingly invited to participate in the processes through which one type of product is differentiated from a seemingly similar one on the basis of its perceived qualities, but that the qualities do not exist independently of the judgments made by multiple agents, including consumers as well as producers, advertisers, marketers, regulators etc. 1 Many of these debates have played themselves out very actively in geography, particularly in the emergent field of cultural economic geography. Economic geography as a discipline has experienced two major turns since the 1970s: the Marxist turn of the 1970s which rejected positivism and sought to reconstruct the discipline as being about an understanding of spatial relations under capitalism (Harvey, 1982; Swyndegouw, 2003); and the cultural turn of the 1990s, where post-structuralist critiques of representation were brought to bear upon the field (Barnes, 2000; Gibson-Graham, 2003). James et. al. (2008) provide a very useful map of these developments, noting that I makes sense to distinguish five related but somewhat distinct factors in the rise of cultural economic geography: 1. The relationship between structuralist accounts of the spatial dimensions of global capitalism and post-structuralist challenges to what is perceived to be an implicit

10 hierarchy of thought by which particular conceptions of the economy are prioritized (e.g. is labour as a spatially grounded practice more real in its material effects than discourses surrounding labour markets?); 2. Particular ways in which culture and economy interlock, such as the relationship between markets and production as spatially grounded economic practices and the lived experience of people within such economic spaces; 3. The cultural constitution of economic practice, and the awareness that cultural factors can mark significant sources of regional differentiation, local entrepreneurship and competitive advantage in globalized economies, as seen in the debates surrounding clusters and learning regions (e.g. Cooke and Lazzeretti, 2008); 4. Uses of actor-network theory to analyse the performative dimensions of soft capitalism and the ways in which it is engaged in new business management practices (Thrift, 1999, 2002); 5. Debates surrounding the geographical location of cultural/creative industries, and their propensity for clustering (Scott, 2008), as well as the question of whether the provision of cultural and lifestyle amenities for the creative class generates innovation and entrepreneurship in these industries (Florida, 2008). Finally, I want to consider the contribution of creative industries debates, but in a particular way. In much of the extended commentary on creative industries, there has been a focus on the claims made about the creative side, and whether it is legitimate to claim creativity as a sui generis category that can provide a basis for distinguishing some industries and activities from others (Donald, 2004; Schlesinger, 2008), and whether the analytical coherence and critical edge associated with the term cultural industries is lost when the concept is broadened to include sectors such as software and information technologies in a loosely defined set of creative industries, made coherent by of all things the opportunities to exploit intellectual

11 property (Garnham, 2005; OConnor, 2007; Galloway and Dunlop, 2008). Less attention has been given to the choice of industries as an analytical category, possibly because reference to a set of industries provides its own set of policy markers, as well as allowing for the loose alignment of arts and media industries that has long been an aim of this discursive construction of the field. Recent work by Potts et. al. (2008) and Hartley (2009) has begun to rethink this focus upon industries as a starting point, as it derives from Standard Industrial Classifications that have always worked poorly for sectors outside of agriculture, mining and manufacturing, it claims a coherence to a set of outputs on the basis of their inputs that does not stand up to close scrutiny, and it can function too easily as an insider discourse promoting collusion between industry representatives and policy departments, as has happened historically in both the arts and media industries (see e.g. Streeter, 1995). Recent work has proposed an alternative definition based upon social network markets (Potts et. al., 2008). Ill return to this below, but two points which can be made about this are that it avoids privileging producer interests over those of consumers, and it has been developed through a dialogue between cultural studies and evolutionary economics.

Observations on Economics
From the point of view of virtually all of the humanities, and most of the social sciences, the first striking feature of economics as a discipline is how abstruse and mathematical its dominant mode of argumentation seems to be. There seems little doubt that economics was the branch of social theory where the aspiration to scientificity was most openly embraced, and where claims towards greater precision of knowledge arising from its mathematical representation have been made most ardently. In Foundations of Economic Analysis, published in 1947, MIT Professor Paul Samuelson proclaimed that mathematics is a language, and mathematical language became a sine qua non of economics, tending to define who progressed in the discipline and who quietly disappeared. As David Warsh (2006) notes, this has tended to mean that a variety of important and suggestive topics, from moral philosophy to comparative histories of capitalism to the theory of monopolistic competition to the nature of power and its relevance to markets, have either tended to be shunted out of the economics mainstream or translated into mathematical formulae such as game theory that come to strip away much that was originally interesting about the concept. While this has tended to shunt out more critical views towards the capitalist economy, particularly when neoclassical economics was combined with positivist philosophy (see e.g.

12 Lipsey, 2008), it has also sidelined significant non-mathematicallybased defences of capitalism, most notably Joseph Schumpeters theory of creative destruction as the underlying dynamic of capitalism, and the catalytic relationship he foresaw between markets, innovation and entrepreneurship (Schumpeter, 1942). Another feature of economics as a discipline that can appear unusual from the perspective of cultural studies is the existence of openly partisan conservative economists, and the assumption that a plurality of intellectual positions can co-exist which align to political positions across the left-right continuum. This does sit unusually with the claim that one can undertake value free economics where the technical apparatus of analysis and explanation is deemed to be able to operate separately from the ethics and values of those applying it. To take one apparent example, the debates between Keynesians and Monetarists about the most appropriate tools for macroeconomic management are infused with differing positions about unemployment and government debt, that are recognisably in a continuum of arguments between social democrats and liberals on the one hand, and conservatives on the other. One avenue through which these competing tendencies are expressed is, somewhat curiously, the undergraduate textbook. Avowed Republicans such as Greg Mankiw and liberal democrats such as Paul Krugman produce undergraduate economic textbooks in order to shape the wider debate; interestingly, economists have also proved to be enthusiastic bloggers, with conservatives such as Mankiw and Gary Becker and liberals such as Krugman and Brad De Long being engaged bloggers. 2 Economists have also used television programs as a way of popularising their arguments, as seen with John Kenneth Galbraiths The Age of Uncertainty, produced by the BBC in 1977, and Milton and Rose Friedmans Free to Choose, produced by the U.S. PBS in 1980. What does stand out about economics, from the perspective of other disciplines, is how much access economists seem to have to public policy making. The first wave of objections to what we would today term neo-liberalism, which came in the guise of the critique of economic rationalism led by sociologist Michael Pusey (Pusey, 1991), were about the general influence of economists over public policy, as much as they were about types of economics and their relationship to types of policy. Pusey argued that the state apparatus is caught within projections

13 of reality that give primacy to the economy, so that the tail that is the economy wags the dog that is society (Pusey 1991: 10). The problem with the critique of economic rationalism in its first incarnation was that it required an a priori demand that protagonists are for or against markets, or for or against government intervention in a generic sense, assuming that the concern for social management and the development of economy in the practice of government have developed as alternative policy principles; Pusey counters economic rationalism to a bipartisan post-WWII concern for nation-building. There is, however, considerable historical evidence that, in practice, the ethical-normative and the calculative-technical dimensions of policy have typically been developed in tandem, as part of what Foucault refers to a liberal arts of government (Miller and Rose, 1990). Not surprisingly, then, we tend to find that government policies today typically combine a normative dimension with a practical and technical dimension that has been about constructing or problematising a social domain in order to render it governable and amenable to change through the application of policy, and that economics is one of the techniques which emerges through that practice of problem finding as well as problem solving in public policy. The correlate of this is that seemingly small differences among economists often have quite large policy implications. There are many examples of this, ranging from debates about the efficiency of information flows in financial markets, the role of altruism in economic behaviour, and the current interest in the multiplier effects of macroeconomic stimulus packages, but one consequence is that the political implications of a methodology are often less overt than is the case in disciplines such as cultural studies, where the a priori expectation of engagement with a particular political project have always been much stronger. It would be beyond the scope of this paper to develop this proposition in detail, but two points can be noted. First, there are a significant number of recent winners of the Nobel Prize in

14 Economics whose work would have to be seen as questioning claims about rational expectations and efficient market hypotheses George Akerlof, Paul Krugman, Amartya Sen and Joseph Stiglitz would be among the more obvious examples. Second, even as such avowedly establishment entities such as the American Economic Association proclaim that they take no partisan attitude, nor does it commit its members to any position on practical economic questions, they have been criticized by those who have drawn upon political fundraising data to identify a preponderance of Democratic Party supports among the U.S. membership over Republican Party supporters (McEachern, 2006).

Economics as seen from Critical Cultural Studies

It is notable in considering critical literature from media and cultural studies that it tends to work with a quite limited conception of what constitutes economics. Hesmondhalgh (2007: 30) defined economics as being neo-classical economics, which is not concerned with determining human needs and rights, nor with intervening in questions of social justice, but rather with how human wants might be most efficiently satisfied, and which equates the well-being of people with their ability to maximize their satisfactions. Miller et. al. (2001) refer to the neo-classical vision of Hollywood as bourgeois economics which: asserts that the supposedly neutral mechanism of market competition exchanges materials at costs that ensure the most efficient people are producing, and their customers are content. This model may occasionally describe life in some fruit and vegetable markets today. But as a historical account, it is of no value: the rhythms of supply and demand, operating unfettered by states, religions, unions, superstition and fashion, have never existed as such (Miller et. al., 2001: 48). The dominant view of economics from the perspective of critical cultural studies is of a discipline with a singular dominant set of priorities, which are narrowly focused and lack realism. The next step, which emerges with the critique of neo-liberalism, is to argue that such economics effectively functions as an ideology, serving dominant economic interests through the mystification of social reality.

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The concern is that such authors are engaging with a straw figure, drawing upon the textbook representation of undergraduate economics as a stand-in for the economic discipline as a whole. To take one example, Hesmondhalgh identifies the work of Harvard economist Richard Caves (2000) as an instance where even economic analysis that recognizes the specificity of media and culture, and some of the limitations of traditional economic analysis, tends to downplay the severity of the problems of cultural markets (Hesmondhalgh, 2007: 31). Caves work marked an attempt to broaden the remit of economic analysis beyond the economics of the arts, using the creative industries rubric to analyse those activities associated with the supply of goods and services with cultural, artistic or entertainment value. Caves used such tools as industrial organisation theory, theories of transactions costs and information economics to understand, among other things, the relationship between contracts and institutional relationships as alternative means of managing uncertainty in industries characterised by high up-front costs, considerable demand uncertainty, and the resulting need to manage risk. It is not clear to me that such work downplays endemic uncertainty and its associated problems for both creative workers and firms in creative industries, although it uses a language associated with complexity theory rather than fundamental contradiction, which is more characteristic of the Marxist political economy tradition. Part of the issue about the alleged ideological biases of economics in fact concerns differences in methodology. It is not necessarily that different methodologies lead to fundamentally different conclusions. There are certainly pathways from mainstream economic theory, as much as there are from political economy or cultural studies, through which a case could be made for the value of public service media, for example. The risk is that economics has been defined in advance as a primarily ideological project, and its claims to be anything other than ideologically motivated are treated as the mystifications typical of a defence of bourgeois class power. As this approach to the sociology of knowledge has been questioned from so many angles in critical social theory over the last three decades, it is surprising to me that it has been so readily accepted in the critiques of neo-liberalism, and the association of economics tout court with this exnominated ideological project.

Neo-Liberalism

16 There has been a concern that cultural studies has become overly influenced by economic arguments and discourses, and in Australia this often makes reference to the rise of creative industries as a policyoriented academic discourse. At the core of the critical theorists dissent with creative industries is the claim that it promotes neoliberalism as a political ideology, and with that furthers the hegemony of multinational corporate capital over the cultural sphere. Miller finds that neoliberal creative industries discourse has been promoted by carpet-bagging consultants pushing a cybertarian mythology, while the cultural industries remain under the control of media conglomerates (Miller, 2009a: 188, 190, 194). He argues that it has been taken up in an ever-more frenzied search for relevance by those who have found cultural policy studies to be too dirigisme and statist, and counterposes the concerns of cultural studies with critical multiculturalism and the rights of the dispossessed with creative industries, which has at its core the hypocrisy of neo-liberalism (Miller, 2009b: 270,274). Des Friedman views the rise of creative industries discourse in the United Kingdom as part of a larger project of the neo-liberalization of media policy which is designed to transform the existing balance of power to assist the expansion of private accumulation and to undermine the legitimacy and existence of nonprofit and public service media provision (Freedman 2008: 224). Echoing earlier critiques by McQuire (2001) and Rossiter (2006), Hesmondhalgh (2007) argues that creative industries as an academic discourse has been overly complicit with Third Way ideologies that promote marketisation and the commodification of culture under the guise of neo-liberalism, while OConnor expresses similar concerns about the uncritical annexation of the creative industries to the innovation system of the knowledge economy (OConnor, 2009: forthcoming). So what is this neo-liberalism? The term has a shorter history than many would imagine, although the ways of thinking, conceptual frameworks and policy prescriptions that it refers to have a longer history, variously being referred to as monetarism, Thatcherism, Chicago School economics, the economics of the New Right, economic rationalism, and the Washington Consensus as critiqued by Stiglitz (2001). There are two strands of thought that are brought together around the concept of neo-liberalism, with one derived from neoMarxist arguments as developed by Harvey (2005) and Scholte (2005), among others, and a second strand which is derived from the later works of Michel Foucault on governmentality. The neo-Marxist account is the most straightforward to explain. Harvey (2005) Harvey defined neo-liberalism as [a] theory of political economic practices that proposes that human well being can best be

17 advanced by liberating individual entrepreneurial freedoms and skills within an institutional framework characterized by strong private property rights, free markets, and free trade (Harvey, 2005: 2). He proposes that it emerged in the 1970s as a conscious ideological strategy to reassert the class power of business and economic elites, in the face of declining belief in neo-Keynesianism and the policy consensus of post-WWII liberalism, and challenges to power and authority on the domestic and international fronts. It points to the relationship between influential think-tanks and the ideas and policies that shaped the Thatcher and Major governments in Britain from 1979 to 1997, and the Reagan administration in the United States in the 1980s. Harvey argues that neo-liberalism has dominated the policy landscape since the late 1970s, displacing earlier ideas associated with Keynesian economic and social democracy, and that its influence was extended globally during the 1980s and 1990s. Scholte (2005) explicitly links globalization and neo-liberalism, arguing that: From a neoliberal perspective, globalization is an economically driven process that should proceed on first principles of private property and uninhibited market forces. Regulation should have as its primaryif not solefunction to facilitate and protect private ownership and the free operation of supply and demand among producers and consumers. Other economic rules and institutions are political interferences that undermine market efficiency and should therefore be reduced to a minimum. With a combination of privatization, liberalization and deregulation, globalization should bring maximum prosperity, liberty, democracy and peace to the whole of humankind (Scholte, 2005: 1). Foucaults account of the emergence of neo-liberalism is quite different to the neo-Marxist one. In his lectures at the College de France in 197879, Foucault does not trace the origins of neo-liberal thinking about government to the 1970s, but to the late 18th century, noting that the question of frugal government has its origins in this period. He also does not present the question as one of an opposition between the state and the market, but rather observes the paradox that the epoch of frugal government is accompanied by the extensive and intensive development of government practice that has been constantly accompanied, outside and within government, by the question of the

18 too much and the too little (Foucault, 2008: 28). He emphasizes the need to historicize different forms of government, arguing both that an essential Capitalism with its logic, contradictions, and impasses does not exist (Foucault, 2008: 174), and that neo-liberalism is not Adam Smith not market society [and] is not the Gulag on the insidious scale of capitalism (Foucault, 2008: 131). I would extend this point to say that, for Foucault, neo-liberalism is not simply a doctrine that has understood people simply through the precepts of selfishness, as Miller (2009: 271) interprets Foucault as arguing. Foucault locates neo-liberalism in a general problematic of identifying what is too much government, and argues that in the modern world, or at least the world since the 19th century, a series of governmental rationalities overlap, lean on each other, challenge each other, and struggle with each other: art of government according to truth, art of government according to the rationality of the sovereign state, and art of government according to the rationality of the economic agents, and more generally, according to the rationality of the governed themselves (Foucault, 2008: 313). Rather than seeing arts of government as an evacuation of the political sphere, or in Puseys terms society being subordinated to the economy, Foucault argues that it is here that politics is born (Foucault, 2008: 313). Foucault specifically focuses on German neo-liberalism as it emerges in the aftermath of the Second World War, and American neo-liberalism as it is developed through the Chicago School of political economy and through theories of human capital. Of these, it is the American formulation which is the more radical and the more recognizable in the critiques of neo-liberalism, proposing the generalization of the form of the market, and particularly the application of market precepts to noneconomic domains. The German case of the Ordoliberals is more complex, as they took as their starting point the rise of Nazism, and the question of how to avoid the return to a totally planned economy and society in Germany, which they saw as having roots in more longstanding protectionist and statist impulses in 19th century German political and economic thought. The resulting concept of the social market economy, while explicitly developed as an alternative to state socialism, is not neo-liberalism as understood in the Chicago School approach. It envisages prices being set primarily through markets, but also a role for governments in promoting competition and restricting monopolies and unfair trading. It does point towards generalization of the enterprise form to the point where individuals can be seen as entrepreneurs of their own lives, but is also points towards comprehensive social insurance, as well as forms of collective consumption and the provision of social goods. It insists strongly upon the rule of law as a counterpoint to extending the realms of economic

19 planning, but does so with a view to the state being otherwise actively engaged in other forms of planning, such as urban planning or the development of infrastructure. One thing that Foucault is very clear upon is that there is no such thing as capitalism in the singular and that capitalism can only be understood through empirically grounded economic and institutional histories. It is often observed that social democracy has never developed a foothold in the United States, but it is also the case that countries such as Germany or France have not really had anything akin to the Reagan revolution and the associated retreat from the regulatory state. Why do I focus upon this? One point is that there is today a very clear example of a state where the influence of neoliberalism is minimal, and which is nonetheless moving quickly towards being one of the most influential states on the globe. That state is of course China. Contrary to Harveys assertion that China since the rise of Deng Xiaoping has exhibited neo-liberalism with Chinese characteristics, Nonini (2008) argues that the depth of official commitment to private property rights, free markets and free trade to take three baseline commitments of neo-liberalism is limited, contingent and reversible, particularly if enhancement of any of these was to challenge the power of the Chinese communist party-state. Moreover, he argues that popular support for a neo-liberal policy program in China is virtually non-existent, reflecting the historically weak position of liberalism as a political philosophy in Chinese society, and that while there may be some support for a weak variant of neoliberalism based around support for markets, entrepreneurship and consumerist values, the strong version of neo-liberalism does not exist in China as a hegemonic project (Nonini, 2008: 168). In tracing whether the rise of suzhi (quality) discourse in China can be seen as a proxy for popular thinking in neo-liberal terms, Kipnis has argued that to navely draw upon all types of analyses of neo-liberalism without noting their contradictions leads to a hodgepodge sort of analysis in which the world as a whole and everything in it appears to belong to a single theoretical category (Kipnis, 2007: 387). It could be argued that China is an exception, although if so, it is a big one, and one that is growing. In his debate with Will Hutton about whether China can sustain economic growth without adopting what he terms the Enlightenment trilogy of individualism, liberty and pluralism, economist Meghnad Desai makes the point that capitalism has accommodated a variety of institutional arrangements and only in the most recent phase of globalization have we thought that an Anglo-Saxon style liberal democracy is its sine qua non (Hutton and Desai, 2007). The ability to accommodate Leninism with capitalism is historically unique, but the experience of the Asian developmental

20 states makes it clear that capitalism can co-exist with a diverse range of institutional forms and modes of intellectual justification. Cunningham (2008) has made a similar point about creative industries outside of the British case, where it has a diverse range of policy and institutional inflections and is not simply the local adaptation of a Cool Britannia template, complete with Prime Ministers posing with the brothers Gallagher. Kong et. al. (2005) have also undertaken detailed work on why creative industries policy discourse has found receptive environments in some Asian contexts (Singapore, Hong Kong SAR and, in a more complicated way, China), but not in others, such as Japan or India. More generally, there is the danger that neo-liberalism may become a junk term, akin to the junk bonds and toxic assets that almost brought down the global financial infrastructure of capitalism in late 2008. Observing the ballooning number of references to neo-liberalism found in the field of anthropology in the 2000s, Nonini expresses the concern that: The term neo-liberal has recently appeared so frequently, and been applied with such abandon, that it risks being used to refer to almost any political, economic, social or cultural process associated with contemporary capitalism A term with so many meanings obviously has great utility, because most progressive scholars can agree that whatever neo-liberalism is, they dont like it, and the ambiguity of the term allows discursive coalitions of the like-minded to form without the troublesome bother of having to clarify exactly what it is they oppose or are critical of (Nonini, 2008: 149). There is the more general risk that universalizing claims about neoliberalism may in fact rest upon a kind of Marxist functionalism, whereby an all-encompassing dominant ideology is developed to serve capital in its latest phase, which is deemed to be global and flexible. Nonini proposes downsizing our claims about neo-liberalism and giving them historical, geographical and cultural specificity. Otherwise, the real risk exists of assuming that flexible capitalism brings about the very political conditions within nation-states of deregulation and privatisation etc., which it needs for maximum capital accumulation, and that flexible capital has a universal global

21 capacity to do so, and that to do so is somehow neo-liberal governance, restructuring, domination etc., wherever it occurs in the world (Nonini, 2008: 151).

Where Economics May Help Cultural Analysis

The growing literature on cultural economy, I have argued, faces a significant limitation in that, with some exceptions, it has avoided direct engagement with economics and economists. While this emerges in some ways from limits of economics in dealing with culture and intangibles generally, some of this impulse also arises from a perception that economics as a whole is based around the limited picture that emerges from undergraduate textbooks associating the science of economics with the allocation of resources between unlimited wants and scarce means. Actual empirical work on cultural economy suggests that the gap between economics and cultural studies may not be as great as is sometime assumed, particularly if it is acknowledged that the language of complexity and uncertainty may be used by economists whereas cultural theorists use concepts such as conflict and contradiction to refer to similar phenomena. My own view would be that interdisciplinary and collaborative work between economists and cultural theorists offers a considerably more fruitful path to better understanding cultural economy that the alternative proposed, for example, by Larry Grossberg of cultural studies theorists aiming to do economics better than the economists (Grossberg, 2006: 21). One major obstacle to such collaborative work, however, is the way in which neo-liberalism has been constructed as an all-purpose bogey man, and economists are represented as the ideological handmaidens of this avowedly pro-corporate mode of policy-related academic discourse. I have indicated in this paper that the neo-Marxist version of this argument radically understates the degree of policy diversity and institutional forms of capitalism that we see worldwide, and mistakenly attributes a right-wing leaning to the economics discipline rather than intellectual pluralism, but that it rests upon a view of policy as the unmediated reflection of the ideological interests of the most economically powerful players. It has licensed the use of neo-liberal as a seemingly limitless scare word that can be used to denounce anything that the speaker chooses to disagree with, in a line of apparent solidarity with anyone deemed to be notionally progressive, against anyone deemed to be presenting reactionary or bourgeois thought. The term has some quite distinct genealogies, with the work

22 of Michel Foucault pointing to a complex set of mediations on questions of setting limits to government that have been preoccupations within societies governed on liberal principles for over two centuries, whose institutional manifestations are many and varied. It would be by going further down this path, rather than using the term neo-liberalism where once there may have been reference to bourgeois ideology, that will be more fruitful in understanding where economics as a discipline ahs historically been able to insert itself into policy processes, and the contributions and limitations of such interventions. I will conclude by identifying four areas where there I can identify scope for useful collaboration around the concept of cultural economy between economic and cultural researchers. The first concerns the value of information. Because markets are, by one account, a vast signaling mechanism to various agents that inform decisions, economists have done a lot of thinking about information who has it, how it is distributed, how it is produced, and how it is used (e.g. Shapiro and Varian, 1999). The growth of the Internet and the rise of the digital economy has meant an exponential growth in amounts of available information and capacities to access them, leading to a proliferation of forms of information-driven behaviour, such as online auctions on eBay and other related sites (David and Fopray, 2002). The question of the value of information is also emerging sharply in the present period in debates about the future of news, and plans by commercial media proprietors to shift to user-pays forms of access to their online news sites. It also arises in considering the contemporary roles and purposes of the university, but noting this draws our attention to the important distinctions between information and knowledge, which cannot be resolved within an economic framework that takes as its starting point undifferentiated data. More in-depth and interdisciplinary work on the value of information is emerging as a priority. Second, I would note discussions about the value of networks. Networks are one of the three primary forms of co-ordination of behaviour among agents alongside hierarchies and markets, and there is a general view that their significance has increased over the 1990s and 2000s for reasons related to the rise of the Internet and digital media technologies (Castells, 1996; Thompson, 2003; Benkler, 2006). Social network analysis has its origins in sociology, but it constitutes a major potential field for collaborative research related to the cultural economy. One recent example of such work is by Potts et. al. (2008) which has brought together cultural studies with evolutionary and behavioural economics to propose a redefinition of creative industries around the concept of social network markets. This work aims to avoid

23 the problems associated with industry-driven definitions of the creative industries, such as boundary dilemmas and the implicit privileging of producer interests over those of consumers, by identifiying the creative industries as a field characterised by recurring interactions between learning agents, social networks and market-based enterprises, organisations and coordinating institutions. This presents the creative industries as being engaged in the representation and coordination of new ideas (Potts et. al., 2008: 176) whose definitional boundaries can be expected to shift over time as a result of interactions between learning agents and enterprises in social network markets. A third area of interest is that of motivations for participation and collaboration in online social networks. Economics has long been taken to task for routinely underestimating and downplaying the significance of non-market activities and those undertaken with non-pecuniary motivations. It is now being argued, most notably by Benkler (2006) that an information-driven economy with digital technologies at its core places a premium upon non-market activities with non-pecuniary motivations, as it values a non-proprietorial approach to information as a metapublic good, with many implications for intellectual property, labour markets, the formation and maintenance of networks etc. This debate has been picked up on by Australian economists John Quiggan and Jason Potts in what can bet termed the altruism/signaling debate (Quiggan and Potts, 2008). Quiggan follows Benkler in arguing that the Internet and innovation through it is fundamentally driven by nonmarket activities with non-commercial motivations (altruism), that this has been the Internets history and its future, and that this has wider ramifications for the wider economy and for economics. Potts counters with the proposition that much non-pecuniary online behaviour can be seen as proto-market rather than non-market in its motivations, as it involves a range of signaling behaviours that may have economic payoffs over a longer-term time horizon. As we are often talking here about publicly viewable online activities, such as Facebook profiling and personal blogging, these are activities that clearly concern representation as well as information, and should be amenable to cultural economy analytical frameworks. Finally, there is the relationship of culture to the wider economy, and the particular question of what happens to cultural activities and creative industries in periods of economic downturn and recession. It has been a common observation that the art boom in countries such as Britain co-evolved with what proved to be an unsustainable hyperinflation of financial assets and bonus cultures in the City of London, rewading, as Alice OKeefe argued in her last arts column in the New Statesman, to a contemporary visual art scene [that] has been the most slavishly money-serving, catering as it has done

24 exclusively to the rich (OKeefe, 2009). For OKeefe, this was encouraged by New Labour with its promotion of the creative industries as a growth segment of British industry: I remember, in March 2007, going to see Tony Blair make a speech on the arts at Tate Modern, in which he boldly claimed to have presided over a cultural "golden age". The arts, he told the gathered great and good, were a vital component of Britain's continued economic success: "A nation that cares about art will not just be a better nation. In the early 21st century, it will be a more successful one. In new Labour parlance, the arts had become the "creative industries". Like bankers and stockbrokers, artists were expected to prop up the wobbly edifice of consumer capitalism, to generate profit, attract tourists, help Britain market itself as a cultural - and therefore financial - "hub". Placing culture firmly at the service of finance had its advantages for the arts administrators in the audience, too, as it gave them a clear claim on their slice of the government pie (OKeefe, 2009).

If this has been the case, then one would expect much of the arts and the creative industries to sink into recessionary gloom alongside the financial sector that promoted their unsustainable growth. At its base, this is a claim that these are not real industries, and that culture remains a residual outcome of developments in the real economy. But Andy Pratt, in a recent review of possible developments (Pratt, 2009), proposes that this is only one of four possibilities for cultural sectors in a recession. Another possibility is that the public sector picks up much of the slack arising from a private sector downturn, and that cultural activities flourish, albeit with quite different and most likely more socially oriented priorities. A third possibility is that we are in a phase of creative destruction, as Joseph Schumpeter referred to business cycles under capitalism, and that

25 there will be green shoots of new forms of culture driven by new ideas and possibilities, as others wither as they prove to be unsustainable. The final possibility that Pratt raises is that as many economists and policy makers have not only failed to adequately register the rise and growth of the creative industries, but have failed to understand their changing relationship to economy and society. The resilience of the cultural sectors, in this account, arises from a wider shift in the relationship between symbolic and material production, so that:

The ways in which economic transactions include, or depend upon, the cultural dimension of their activities to not only add value; but to encourage consumers to make the buy/not buy decision. So, culture is not simply an added extra, or candy floss, it is the main action, and as such cannot be removed from the product easily (Pratt, 2009: 496). Such questions are very much the stuff of cultural economy research. My argument today is that we are going to need to draw upon at least some economic analysis to begin to answer them.

1How the Internet was defined as being like print in the U.S. (striking down of Communciations Decency Act in 1996), and like television in Australia (extension of Broadcasting Services Act to online content). 2John Quiggan in Australian context.