Dimiter Gantchev, Deputy Director, Culture an Creative Industries Sector, WIPO An Intellectual property Based Approach to Surveying the Economic Contribution of the Creative Sector: A Perspective from the World Intellectual Property Organization Medellin, Colombia 6 March 2013

Overview Conceptual framework Copyright, creativity and development Economic fundamentals of copyright The empirical evidence Underlying premises Direct relationships and industry analysis Challenges D. Gantchev

Creative Industries on the Policy Agenda Growing interest by policy makers, industry, civil society Creativity as a resource and growth factor Policy demand to quantify the intangible economy identify the role of creativity in knowledge society link creativity to development objectives Creative industries as a positive agenda D. Gantchev

Intellectual Property and Creativity IP is one of the tools to promote creativity IP is a new conceptual framework which allows to: transform creative outputs into economic goods monitor the supply and demand obtain evidence on impact IP is perceived today as an indicator of development Mr. D. Gantchev-WIPO

A Copyright Approach To Creative Industries Creativity is the subject matter of copyright protection, but poses definitional problems as such Copyright is a well defined concept a set of rights given to authors to control the use of their works a financial mechanism to reward creators a basis for the operation of huge industries Mr. D. Gantchev-WIPO

Economic Fundamentals Of Copyright Economic characteristics Economic consequences Conditions for economic efficiency Economic function An enabler A market framework A measurement tool Social Function balance and access Cultural function Contribute to cultural diversity and supply of content Mr. D. Gantchev - WIPO 7.

Source:Daryl Mann, Beijing,Sept 2010

Source: Daryl Man, Beijing, Sept.2010

Working on the Evidence - Major Features of the WIPO Model Methodology applied consistently since 2003 in over 40 countries with the support of interested partners Copyright - driven Policy - oriented Provides measures of size Internationally comparable Based on official data Production-based

Typical Uses General raise awareness project copyright as a growth factor project a positive image of the country Specific quantify the measurable characteristics of industries based on copyright evaluate and compare size, performance and competitiveness monitor trends and provide policy options, program development and practical measures assess the impact of policy or economic measures – FTAs, accessions, legislative amendments

Creation Formatting Production Production of equipment Distribution Distribution materials Marketing and promotion Consumption and use of the work Production of equipment for the consumption Identifying the Creative industries Mr. D. Gantchev - WIPO 12.

Measurement Indicators Indicators of size Value added Employment Foreign trade Dynamic indicators Productivity Multipliers Contribution to real GDP growth Constant search for new ones Mr. D. Gantchev-WIPO

% Share of GDP % Share of Empl oyment Measuring the Size of Copyright Industries

GDP contribution

Employment contribution

Country Positioning based on %GDP and % Employment

Creative Industries Labor Productivity Index

R 2 = 0.31 Relationships to Economic Indicators GDP per Capita Source: The World Bank Development Indicators

Relationships to Economic Indicators International Property Rights Index R 2 = 0.39 Source: WIPO and Property Rights Alliance

Relationships to Economic Indicators Index of Economic Freedom R2 = 0.31 Source: The Heritage Foundation

Source: The Heritage Foundation / Transparency International Relationships to Economic Indicators Freedom From Corruption R 2 = 0.39

Relationships to Economic Indicators Global Competitiveness Index GCI (2012) R2 = 0.23 Source: The World Economic Forum (WEF) R 2 = 0.44

24 Relationships to Economic Indicators Global Innovation Index (2012) R2=0.49 Source: INSEAD eLab

Summary of correlations Source: WIPO

Contribution of copyright industries to GDP and to Employment

GDP in the Core Copyright Industries

Employment in the Core Copyright Industries

29 Creative Diversity

30 Copyright Industries Compared with Other Key Industries in Selected Countries

Creative Industries in the Development Context

Core and Non-Core Creative Industries Contribution in the Development Context Core Creative Industries Non-Core Creative Industries

Findings An overall significant contribution Drivers – publishing, R/TV, software, music, advertizing, film Impressive dynamics Well interconnected with other industries Higher capital and labour productivity Output and employment multipliers Mr. D. Gantchev-WIPO

Problem areas Getting information Analyzing information Taking further action I/O tables Export statistics Royalties Involving the industries in the analysis Crosschecking information Parallel studies (EU, UK,UNCTAD…)

Creative Industries in the recession The US IP industries – engines of growth 27,7% of US jobs, 34,8% of GDP in 2010 growing faster then the rest of the economy 1,6% to 1% (copyright 2,4%, patents 2,3%, trademarks 1,1%) wages were 42% higher than other industries WIPO statistics points to increased use of the IP system in 2011 patent filings - 7,8% growth trademark applications - 13,3% growth Internation registration of designs – 16 % increase global copyright Industries – 5,26% of GDP and 5,49% of employmentPCT CISAC – 1% growth in total worldwide collections (7,6 bln Euro) - royalty collections outpace GDP growth Source: Intellectual Property and the US Economy, Industries in Focus, March 2012, US Department of Commerce and WIPO statistics, CISAC – On the lookout for growth, 2013.

Copyright Challenges to Creative Industries Policy Copyright - a national and global policy issue Empowerment of the prosumer Economic use and abuse – a state of shock piracy - threatens the model and requires new strategies Technology Convergence blurs boundaries between sectors and markets Mr. D. Gantchev

Final Words The creative industries are expanding and copyright is an important enabling factor Their performance is enhanced when stimulated by governments, the legal system and the businesses environment. Producing economic evidence on the creative industries facilitates policy making and raising public awareness Mr. D. Gantchev-WIPO

Thank You! 38. Mr. D. Gantchev - WIPO