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January 15, 2015

A Truer Value of Art and Culture


According to a new Bureau of Economic Analysis report, arts and culture contributed nearly $700 billion to the U.S. economy, or 4.32 percent of gross domestic product in 2012. This total was higher than other core American industries such as agriculture, construction and transportation.

In other words, the impact of the arts and culture industry on the U.S., measured in economic and financial terms, is huge.

Theft of arts and culture is also correspondingly large. In 2007 IPI examined the cost of piracy to our economy in “The True Cost of Copyright Industry Piracy to the U.S. Economy” and found that piracy has a harmful impact on U.S.-produced copyright products and generally on the U.S. economy. In 2005, piracy conservatively cost motion pictures, sound recordings, business software and entertainment software/video collectively at least $25.6 billion in lost revenue. 

But the harm of piracy goes deeper. The U.S. economy loses $58 billion in total GDP annually, 373,375 jobs, and $16.3 billion in earnings; and federal, state and local governments lose at least $2.6 billion in tax revenues annually. In addition, the arts and culture industry generates approximately $25 billion in trade surplus, an uncommon feat amongst American industry. No matter how you look at it copyrights, the innovations and art they protect, are critical to the U.S. economy. 

The industry also provides benefits beyond the economic as the aesthetic value of creation can enhance our lives, broaden our thinking, and challenge our imagination—and sometimes even sheds light on truth.  

It is easy to argue and demonstrate that copyright incentivizes greater creativity because it benefits artists. But the truth is that the benefit is much broader and deeper—we all benefit when artists and creators invent, write, film and imagine. And that benefit isn’t exclusively domestic, because the U.S. exports so much of our creativity. 

And that means it’s also true that we all lose when piracy, whether via hacking or other means, is left to run rampant. 

Some suggest that technology somehow stands apart from creativity; that there is a natural tension between the copy-protected industries and technology. But that sort of thinking is myopic. As John Lasseter, Pixar’s co-founder and chief creative officer, has said, “Art challenges technology, and technology inspires art.”  Encouraging the Internet ecosystem to grow, and making sure that government policies do not stand in the way of (or indeed harm) that growth, should be an attractive goal we can all share.


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