THE CONTRIBUTION OF ARTS EDUCATION TO NATIONAL INCOME (page 2)

Design Technology

Just as the physical and social sciences are the source of physical and organizational technological change, art is the epistemologic source of improved product design (D). Unlike the sciences, however, advances in art do not generally take place in the university but rather emerge from the professional nonprofit fine arts where art for art's sake is the dominant motivation (Chartrand, 1987a).

The contribution that design brings to the marketplace can be called elegance. This term is also used in mathematics, the physical sciences, and economics where it expresses Occam's Razor a guiding principle of the scientific method: Fewest assumptions for the maximum explanation. Elegance can be defined as "ingeniously simple and effective" (Sykes, 1985, p. 311).  This also catches the sense of economy as frugality.

Aesthetic design is fundamentally different from technical or functional design such as a more fuel-efficient automobile engine. Its impact on consumer behavior involves what has been called "the best looking thing that works" (Cwi, 1985). If a consumer does not like the way a product looks, he or she may not try it. Similarly, a rich endowment of natural resources does not guarantee a nation will develop up-scale value-added products. For example, Canada is the largest timber producing country in the world and yet imports Swedish IKEA furniture. This is not because Swedish pine is better, but rather due to superior design.

The importance of art to international economic competitiveness was first recognized in the English-speaking world over 150 years ago in the United Kingdom with the establishment of the first school of design in 1836. Until 1814, the Statute of Artificers had regulated training and employment of artisans in the craft guild tradition. In that year, responding to deregulation or laissez-faire economic policies, Parliament abolished the statute. In short order, the guild system collapsed and the labor market became flooded with unskilled workers. By 1835 the quality of British production, particularly textiles, had declined to the point that the British Board of Trade appointed a select committee to investigate the problem and recommend remedies. The committee called for the direct application of art in manufacturing in order to maintain competitiveness with European rivals. The result was creation of schools of design (Savage, 1985, pp. 94-97).

Similarly, in 1870, the Commonwealth of Massachusetts became the first American state to make art education a requirement in the public schools with passage of the Drawing Act. The Act originated through pressure by Boston manufacturers who argued that European students were trained in design and drawing and therefore American manufacturers suffered a competitive disadvantage (Freedman, 1985, p. 21). Within two decades, the same argument served to introduce art education in Canadian schools (Chalmers, 1985, p. 108). During this period, the most eminent of contemporary economists, Alfred Lord Marshall, explicitly recognized the importance of art to economic life, even if he questioned the moral results of art education:

Education in art stands on a somewhat different footing from education in hard thinking: for while the latter nearly always strengthens the character, the former not infrequently fails to do this. Nevertheless the development of the artistic faculties of the people is in itself an aim of the very highest importance, and is becoming a chief factor of industrial efficiency . . .. Increasingly wealth is enabling people to buy things of all kinds to suit the fancy, with but a secondary regard to their powers of wearing; so that in all kinds of clothing and furniture it is every day more true that it is the pattern which sells the things. (Marshall, 1920, pp. 177-178)

Since the Great Depression of the 1930s, however, the economic importance of design, and therefore the contribution of art to national income, has, in effect, been forgotten. Partially this reflects the perceived dubious morality of the artist reflected in Marshall's words. It also reflects the pedagogic triumph of the Pestalozzian rational for art education, namely to develop creativity and expression, which displaced the economic rationale in the 1930s (Betenas, 1985, pp. 99-101). It also reflects the traditional dis-ease concerning art felt by political philosophers since the time of Plato:

We must remain firm in our conviction that hymns to the gods and praise of famous men are the only poetry which ought to be admitted into our State. For if you go beyond this and allow the honeyed muse to enter, either in epic or lyric verse, not law and the reason of mankind, which by common consent have ever been deemed best, but pleasure and pain will be the rulers in our State. (Plato, The Republic. Book X)

It also reflects, however, a general shortsightedness on the part of contemporary economists and other social scientists concerning the nature and implications of the Industrial Revolution. The Industrial Revolution not only transformed economic production, it also transformed the nature of consumptions making phenomena like advertising, the department store, fashion, and the mail order catalogue critical to the modern economy (McCracken, 1988, p. 4). This lack of study has resulted in little empirical evidence concerning the impact of art on economic competitiveness. But while the impact of improved design has not been quantified, its impact on competitiveness is again being recognized:

There is, then, another aspect to culture, namely good taste, good design and creative innovation, that should enable smaller industrial economies to compete effectively in the world economy .... In this endeavor, higher quality implies an organic relationship between business and engineering, on the one hand, and design and craftsmanship, on the other.... High quality products, technologies, plants, homes, cities and locales require the presence of creative artists of all kinds. To increase the long-run supply of artists ... governments must support the artists and the arts. The long-term return from investment in artists and the arts is real and substantial. In the absence of strong public support of this sector, Canada will not reap these benefits. Governments at all levels should increase their contribution to their respective arts councils. (Royal Commission, 1985, pp. 115-116)

Today the importance of design in international competitiveness can be seen in the United States and Canada where higher quality consumer products tend to come from abroad, particularly from Europe. Why? Given that capital plant and equipment in North America is as good as that in Europe, the answer is not superior European production technology. In fact, it results from a feedback between skilled consumption and production resulting in superior design. As noted by Tibor Scitovsky in his path-breaking book, The Joyless Economy:

The North American buyer of European imports benefits from the high standards which careful European shoppers' finicky demand imposes on their producers; he does not have to be a careful shopper himself. In other words, he can be what is known as a free rider, enjoying the benefits of other people's careful shopping without paying his share of the cost, in terms of time and effort, that careful and aggressive shopping involves. That explains why producers find it unprofitable to cater to his demand by trying to out-compete high quality imports, despite the often exorbitant ?price they fetch. Consumers seem willing to pay a high price, in terms of money, for the reputation of European imports; that is we pay cash to obtain high quality without having to pay for it in terms of careful shopping. (Scitovsky, 1976, p. 178)

When the design advantage of European producers, and increasingly that of Japanese producers of consumer electronics, is combined with the wage advantage of offshore or Third World producers, then the North American producer is left with a narrowing mid-range market. This combination of design and wage disadvantages may explain the apparent deindustrialization of North America. Improved productivity through robotics and other new technologies may lower costs of production, but only improved design will secure for North American producers part of the growing up-scale consumer market.

The importance of enhanced design is becoming apparent to some major North American corporations including SCM, Teledyne, Black & Decker, and J.C. Penny. This change reflects a bottom-line awareness that if a consumer does not like the way a product looks, then he or she may never get close enough to find out how well it performs, and therefore there is no chance for a sale. Growing awareness of this basic principle is resulting in increased recognition of the importance of industrial design and the role it plays in helping companies meet sales and marketing goals. More and more marketers are now enlisting the aid of design-consulting companies or setting up their own in-house design departments (Skolnik, October, 1985, p. 46). From where do design skills come? They come from the practice of art.

The Quaternary Sector

Changes in physical technology resulting from research in the physical sciences (T), improvements in organizational technology (O) resulting from social and management science research, and improvements in design (D) resulting from advances in the arts (Shapiro, 1970, p. 495) are now major sources of growth in national income, thus:
Y = f (K, L, T, O, D) ^g

Advances in physical, organizational, and design technology are legally protected by intellectual property rights legislation including: patents (emerging from the physical sciences); registered industrial design (emerging from the physical sciences and the arts); trademarks (emerging from the arts) and copyright (emerging from the physical and social sciences, humanities, and the arts). Managerial and industrial know-how also fall into this category of abstract goods and services. At present such abstract goods and services constitute what can be called the quaternary or fourth sector of the economy.

At any point in time, there exists a stock of capital and labor which embodies current and past technical and educational attainment. Advances in physical, organizational, and design technologies are flows that become embodied in new products, industrial processes and equipment, organizational methods, styles, and fashions.

In dollar terms, research, both scientific and artistic, involves a tiny amount of resources compared to the existing capital stock and labor force. However, its role in economic growth is that of a catalyst stimulating changes and improvements in the quality and efficiency of capital and labor (Shapiro, 1970, pp. 490-491). The information economy is based on the buying, selling, and licensing of abstract intellectual property rights which result from advances in physical, organizational, and design technologies.

The importance of such abstract goods and services can be demonstrated in two ways. First, in external trade a proxy for their importance is învisible exports. In the United States, for example, it was invisible exports that minimized the impact of enormous price increases in petroleum imports during the 1970s and 1980s:
These "invisible exports," preponderately the yield from human capacity, particularly organizational and managerial capabilities, nearly offset the increased expenditure for petroleum imports that put the foreign-exchange account $7 billion in the red. (Ginzberg, Vojta, 1981)

In the domestic economy, the importance of abstract goods and services, and more specifically the contribution of art to national income, can be demonstrated by the size and nature of the arts industries and the applied arts. There are four distinct segments of contemporary art, namely the fine arts, the commercial arts, the amateur arts and the applied arts. In each, the creative source is the individual artist. The fine arts are a professional activity which serves art for art's sake just as knowledge for knowledge's sake is the rationale for pure research in the sciences (Chartrand, 1980). The commercial arts are a profit-making activity which places profit before excellence. The amateur arts are a recreational activity that serves to re-create the ability of a worker to do his or her job, or a leisure activity that serves to self-actualize a citizen's creative potential, and thereby permits him or her to more fully appreciate life. The applied arts involve, as their name suggests, application of art in the day-to-day activities of all businesses and the public sector, for example, interior and product design, illustrating art, and copy writing and editing.

Each art activity is intimately interrelated. The amateur arts, in actualizing the talents and abilities of the individual citizen, provide an educated audience and initial training for the fine and the commercial arts. The fine arts, in the pursuit of artistic excellence as an end in and of itself, provide research and development for the commercial and the applied arts. The commercial arts, in the pursuit of profit, provide the means to market and distribute the best of the amateur and the fine arts to an audience large enough and in a form suited to earn a profit. The applied arts borrow talent and technique from the other three forms of artistic endeavor and apply the experiential knowledge in all non-arts industries.

Collectively the fine, commercial, and amateur arts make up the arts industries which include advertising, broadcasting, crafts, motion pictures, performing and visual arts, publishing, sound, and video recording. Compared to all manufacturing industries, the Canadian arts industry in 1985 was the largest with respect to employment, the 3rd largest with respect to salaries and wages of more than $3.8 billion and the 9th largest with revenues of $11.3 billion or 2.4% of G.N.P. (Research & Evaluation, November, 1988). It is important to note that between 1982 and 1985, the rank order of the arts industry's salaries and wages jumped from 7th to 3rd, indicating the growing employment importance of the arts in the postmodern economy.

Perhaps the most significant economic contribution of art to the economy is employment. Between 1971 and 1981 the Canadian labor force grew by 39%. The arts labor force, or individuals using arts- and crafts-related skills in their day-to-day jobs, increased by 74%. With respect to the applied arts, almost 65% of all artists, employed full-time as artists, were employed outside the arts industries in 1981 than were employed within them. The majority of artists in fact work in other industries as designers, illustrators and decorators. Their skills are used in all primary, secondary, and tertiary industries (Research & Evaluation, 1987a). Artistic skills and talent are like scientific skills, they pervade and permeate all sectors of the contemporary economy. Taken together the arts industries and the applied arts employed more than 414,000 workers in 1981, or nearly 4% of the total labor force, making artistic employment larger than the primary agricultural labor force and larger than total federal government employment in Canada.

THE DEMOGRAPHIC REVOLUTION

There are four fundamental demographic changes that are contributing to growth in arts participation and the emergence of the arts as a significant factor of economic production. These are: rapid urbanization, rising levels of education, increasing participation of women and the aging of the population.

Urbanization

In the last century the world has changed from a predominantly rural to an urban society. Artistic activity has always concentrated in cities. The city provides the necessary threshold and concentration of population required to support an integrated network of cultural facilities, pools of artistic talent and a rich spectrum of audiences. These facilities, talent, and audiences are spread out across the country in a hierarchy of regional and national centers of excellence which collectively constitute national civilization (Litwick, 1970):

The polis is the place of art .... The magus, the poet who, like Orpheus and Arion is also a supreme sage, can make stones of music. One version of the myth has it that the walls of Thebes were built by songs, the poet's voice and harmonious learning summoning brute matter into stately civic forum. The implicit metaphors are far reaching: the "numbers" of music and of poetry are cognate with the proportionate use and division of matter and space; the poem and the built city are exemplars both of the outward, living shapes of reason. And only in the city can the poet, the dramatist, the architect find an audience sufficiently compact, sufficiently informed to yield him adequate echo. Etymology preserves this link between "public," in the sense of the literary or theatrical public and the "republic" meaning the assembly in the space and governance of the city. (Steiner, 1976)

Successful professional arts activity in a given city tends to be translated into national culture, that is, the city is the testing ground from which shared national artistic goods and services emerge. In turn, national culture tends to set the standards of excellence against which regional culture is judged. Thus an intimate linkage exists between regional and national culture which, in turn, links with multinational culture. The arts thereby transcend political and geographic boundaries of cities, provinces, and nations. The advent of the media arts has amplified, not inhibited, this tendency.

The arts also play a direct role in enhancing the economic viability of cities. They contribute, for example, to urban revitalization and industrial location. The arts assist in urban revitalization in two ways. First, the arts enhance one of the built-in advantages of the city, that of urbanity (Perloff, 1979). They increase excitement and variety and thereby draw large numbers of people from the suburbs as well as tourists who in turn support business development. An example is the Lincoln Center built in 1959 in a depressed neighborhood in New York. Some 14 years later the center was surrounded by $1 billion worth of new office buildings, apartment complexes and restaurants, thereby increasing the tax base of the city (Backerman, 1983).

Second, through "artists' colonies," the arts can revitalize run-down neighborhoods. In most cases the low income of artists forces them to live in cheaper areas of a community. When they concentrate in such areas, they change the ambiance and image of the neighborhood. By enhancing the district's image, an artists' colony causes "gentrification" by attracting young middle class professionals to share in the artistic ambiance.

Generally, an artists' colony is associated with improvement in housing and commercial building stock resulting in increased rents and taxes. Eventually artists can no longer afford to live in the neighborhood and move on. Examples include Yorkville in Toronto and the Soho area of New York City (Jeffri, 1982, p. 44).

Traditional industrial location theory suggests that companies locate plants in a particular community for reasons such as access to markets, raw materials, and energy supply. During the 1960s, however, many companies began to locate their operations according to the amenities available in a given community, such as good weather, easy access to cultural, educational, and recreational facilities, and so forth.

The tendency to make industrial location decisions according to a community's amenities has been amplified by the shift from traditional "smokestack" manufacturing to high-tech industries. Some observers suggest that jobs now follow people in high-technology industries rather than people following jobs. To attract and retain scarce, highly trained high-tech workers, companies and communities must offer an attractive quality of life including the fine arts (Sellner, 1982, p. 82).

Education

The average level of education has risen dramatically in the last generation. In 1961, approximately 11% of adult Canadians had some postsecondary education compared to almost one third in 1985. By the end of this century, it is projected to be almost 40%. Within the labor force, that is, the taxpayers, the average level of education is forecasted to grow even faster. Between 1977 and the year 2000, members of the labor force with at least some postsecondary education will double from 3.4 million, or 32% of the labor force, to 6.7 million, or 45% of the Canadian labor force (Research & Evaluation, December, 1987a, p. 2).

Studies conducted around the world, and across Canada, indicate that the fine arts audience is characterized by high levels of education (McCaughey, 1984). A proxy for the size of the fine arts audience is the number of adult Canadians who have at least some postsecondary education. Accordingly, the fine arts audience no longer constitutes a small statistical elite. Rather it represents a significant plurality of the adult population at present, and by the year 2000 it will represent almost half of all taxpayers, taxpayers who are the most socially active, politically aware, and economically powerful members of society.

The impact of rising levels of education can also be seen in the growth rate in participation in alternative leisure-time activities. Between 1977 and 1985 the adult population grew at an average annual rate of 1.6%. Participation in arts-related activities grew significantly faster, in fact significantly faster than all other leisure-time activities. Attendance at museums and art galleries grew at an average annual rate of 2.6%; use of libraries at 2.4%; and attendance at live theater at an average annual rate of 2.1%. On the other hand, attendance at sports events increased at an average annual rate of 1.3%, and television viewing at 1.4% (Research & Evaluation, December, 1987a, p. 3). Through to the year 2000, growth in arts participation will exceed growth in both the adult population, and alternative leisure activities.

Women

The second significant demographic trend during the last generation has been the entry of women into the economic and political life of the community. This has had a dramatic impact on family structure and employment patterns. In 1971, 1 household in 3 was the traditional one in which the wife stayed home with the children; by 1981 only 1 household in 5 fit this description. By 1985, more than 70% of Canadians were employed in the service sector. This represented a 31% increase in service jobs in a decade. There was virtually no employment growth in manufacturing. Growth in service sector employment contributed to increasing participation of women in the work force. The participation rate of women rose from 42% in 1973 to 54% in 1985 and is forecasted to reach 57% by 1995 (Clarkson Gordon, Woods Gordon, 1986).

Women in North America have traditionally been considered the carriers or guardians of culture. In fact, next to level of education, sex is the best demographic indicator of arts participation in North America. Women tend to be more exposed to, and involved in arts and creative activity in childhood than men, thus forming an adult taste for the arts. In North America, women make up 60% of the audience. This sex bias, however, is not apparent in Europe where the arts audience is roughly 50% male (McCaughey, 1984, p. 4).

Another indication of the important role of women in the arts can be seen through three comparisons of women's employment in the labor force as a whole and in arts-related employment. First, according to the 1981 Canadian census, women represented 40% of the labor force but almost 50% of the arts industry labor force. Second, 48% of all women in the labor force had some postsecondary education compared to 65% of women employed in the arts industry.

Third, only 1% of women in the labor force had a Master's degree, while 11% of women employed in the arts-related occupations had at least a Master's degree. In fact, no sector is as dominated by women as the arts industry. No car company or major manufacturing firm has been founded by a woman. But many ballet and theater companies, galleries, and music festivals have been established by women.
Accordingly, domed sports stadiums appeal to a part of the population, young males, which, at least in relative terms, is of declining political and economic importance. Opera houses, galleries, and other cultural facilities, as well as other social institutions such as day-care centers, should form the basis of the political êdifice complex of future politicians if they wish to appeal to the increasingly important women's constituency. The increasing role of women in the economy and politics will, in and of itself, lead to increasing political and economic recognition of arts and culture.

Aging

It is widely known that the demographic structure of Western countries is being fundamentally altered by the aging of the baby boom generation. In fact, by 1996, nearly 8 million Canadians will be over 50 years of age, and this age bracket will represent 28% of the population, up from 22% in 1976. The over-65 age group will account for 13% of Canadians in 1996 compared to 9% in 1976. There will also be a 7% decline in the number of people under 35 (Clarkson Gordon, Woods Gordon, 1986).

It is not generally recognized, however, that after education and sex, age is the best demographic indicator of participation in most arts-related activities. The older one grows the more likely one is to participate in arts-related activities, at least up to retirement age (McCaughey, 1984, p. 6). Now that compulsory retirement at age 65 has been abolished and if the work week continues to decline, then older members of society will have more time and financial means to participate in arts-related activities. This trend will, of course, be reinforced as the highly educated baby-boom generation of the 1950s and 1960s becomes the Geriatric boom after the year 2000.