Do we jeopardize state budgets when we entice the film industry to visit?

The creative economy as “big business”: evaluating state strategies to lure filmmakers

From Journal of Planning Education and Research

The “gold rush” in entertainment media continues whilst the worldwide taxpayer picks up the tab, supporting film and TV production costs through tax breaks. The creative economy is big business offering job creation, and may in addition help market the city or state encouraging tourism. This article examines how policy makers in the US have increased efforts to attract film makers with attractive tax incentives and have started an international trend. The industry can often inject millions of dollars into the state economy. Sceptics raise concerns regarding how the strategies impact on the use of public money.  Investment in the entertainment industry cannot be made without cuts to the state budget in other areas, leaving states to compete for inward investment.

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State policy makers across the United States have ramped up efforts to attract film and television production through tax-based subsidies that provide producers with money to finance productions. To better understand the role of tax-based financing, we examine evidence concerning the fiscal impacts of film and television subsidy programs, and the methods used to calculate job creation and tourism impacts. We also look at the potential for developing film and television industries outside Los Angeles and New York. Our findings illuminate why policy makers need to carefully evaluate the methods used to rationalize public expenditures on incentives for economic development.

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Article details:

Title: The creative economy as “big business”: evaluating state strategies to lure filmmakers

Authors: Ned Rightor

From: Journal of Planning Education and Research

DOI: 10.1177/0739456X09354453

First published: December 21, 2009

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