An Analysis Of The World Film Industry Economics Essay

An Analysis Of The World Film Industry Economics EssayIn this research bulge, the target audience should to be the citizenry working in the bring application. The results top executive be better validated through reference point with his target group, however, obtaining this data, e.g. via a survey, is problematic, as it is hard to predict the re enlistment topical anaestheticises. For this reason, this elementary research could not be done.Nevertheless, secondary research leave behind be adapted in this give, and this chapter leave withal contain the data from near scholars in revision to provide some evidence in firmness of purpose to the research question. It go away overly contain some data and results from EcoWin. EcoWin is a web-based database that collates a wide variety of financial and economic clock serial from over 100 different countries.Moreover, the economic concepts used in this project leave behind be the multiplier issues. This is be take the m ultiplier effect is a regularity by which job opportunities and wealthiness argon created by attracting new-made exertion to an area. It is used to explain the bloods between an manufacture and the related creation of wealth in the area. It could increment the amount of industries in the area, which would create more jobs and therefore wealth and the over any image of an area.3.1 The Multiplier political sympathies issueThe multiplier effect screw be seen in approximately industries, and can illust measure the advantage and development of an assiduity. The multiplier go unwrap meet its greatest impact where unemployed resources exist. The following model (diagram 1) is an recitation of this theory. It records how the call for industriousness could act the miserliness. Although the blast perseverance has been established in a particular inelegant, it pass on ask to decide whether the cinema go away knock d aver locally or overseas. each step will lead to different consequences. For instance, where the accept constancy decides to shoot a get overseas, it whitethorn induce jobs to that boorish, which will help the country to improve their engineering science and cultural. Furthermore, this will help them to attract more companies from overseas to invest in their country. This may luckyly raise some of the countrys GDP. As seen in Appendix 1, information from the UK council, it was stated that the multiplier effect had helped the UK take a shit 425 million in assess tax and had contri plainlyed 1.6 billion to their GDP per stratum. This shows the substance of the multiplier effect to the economy.Diagram 1 Example of the Multiplier Effect in the Film Industry.Chapter 4. Data Analysis and ResultsThe factors that ability affect the economy are categorised as purpose, tourism, engine room and culture. Taking a motion picture festival or shooting a use up as an model, we can compare the unemployment count during the h osting of the festival and during any opposite time. This is because the employment rate energy however affect the countrys economy within a unawares period of time. In addition, the tourism, culture and technology elements spillover to the take up industry might too affect the local or national economy.India, Korea and Hong Kong are all examples of develop countries that are showing good performance in their guide industry. This chapter will compare the results from selected developing countries (India, Hong-Kong) and developed countries (UK, US), to see if there are any similarities and differences between them and why.This chapter will also try to investigate only(prenominal) one film Blood Diamond, ventingd at the end of 2006, because the ranges of the film industry are too big. This film was produced in the States but gibe in South Africa, so it is a good example for this project to investigate. Furthermore, we will compare the tourism rate before and after the rele ase of the film to see whether there were any affects to the economy. It might be promiscuous for people to find out whether are there any relationship between film industry and the economy. Also, by finding some data of labour income and referring to the multiplier effect (diagram 1), we will draw a timeline of the film industry to see the threshold and investigate and analyse all the turn the between developed and developing countries. The result may subject to show whether the development of a film industry will help to accession the LDCs economy.4.1 Developing countries (Hong Kong India) VS Developed Country (US)To find out whether the film industry could help and improve the LDCs economy, we will compare the recrudesceth of the film industry in developing countries and a developed country.4.1.1Hong-Kong IndiaHong-Kong and India are both developing countries that are performing well in their film industries.Hong-Kongs film intersection reached its highest levels during t he 50s and 60s. However, after the adult male war, the education of the new generations became more Occidentalising one of the reasons for this is because traditional Hong-Kong films were not able to meet the audiences taste. Bringing in US films, also bring in their culture and technology. For example, the performed of the new 3D technology from the US in 2009, it had helped to subjoin the revenue for Hong Kongs film industry. From a reputation of US Commercial Service (2010), said that the new 3D technology has helped grow Hong-Kongs misfortune office, it had gain US$151.9 million in 2009 which had grown 6.5 share from 2008. It shows the affect of the USs film industry to the Hong-Kong economy.Moreover, from the Financial Express (2002), it had stated that the India film industry could contribute around RS 50000 crore to their GDP. Bhushan (2010) had also stated that the film industry had contributed $1.5 billion to the Indian economy from 2008-2009. The Website Indiancinema. com (2008) has stated that filmmaking in India may be the best among all developing countries because other countries are more civilize in their technologies. Moreover, it also provided evidence1that the development of the film industry will support the economy.4.1.2 US UKNowadays, the US film industry could be considered the most successful, as it has produced such a high event of famous films. Also, the US film industry might have a higher work out for shooting films, because their financial resources are much more abundant compared to others. However, the US film industry was not comparable this at the beginning, and has undergone a number of development processes.The following shows the impact from film industry to UKs GDP in 2009 it had reinforced the fact that the film industry could affect the economy. slacken 1 Summery of Economic contribution of UK film industry 2009.(Source Oxford Economics)4.3 tourismThe incentive of tourism is one of the outstanding factors that the establishment should pay attention to. Tourism might increase in other countries because of the publics attraction to the films or stars it will create an incentive for the local economy. For example, the rise of tourism will also cause a rise in production, which may in turn raise the local economy.4.3.1 South AfricaMany scholars have agreed that the film industry might affect the economy by drawing in tourists attracted by the film. anatomy 1 shows the total arrivals and departures of foreigners in South Africa. both(prenominal) the arrivals and departures range are increasing each year, showing successful development. In archaean 1986, both rates increased at a lento tempo until 1990, after which they both had a sharp increase. During 1995 and 1997, both rates are growing unstably, showing slight fluctuation. Mongabay (2009) stated that Africas economy had been wrought over many centuries, and started getting better in 1994 because of their new political relation poli cies, which also improved the health of their economy and saw a egress in their GDP2. stick out 1 South Africa Total Arrivals/Departures of Foreigners.(Source EcoWin)4.3.2 America4.4 Labor Market Employment/UnemploymentThe employment rate might only be significant in the developed world, with no reverent correlativity in the third world. Refer to the Multiplier effect (Diagram 2), the exits of film industry will provide jobs for the local, and will induced jobs overseas in nobble be active. The example of a US film Blood Diamond shows that, although the film industry will induce jobs to South Africa this will only enforce patch the film is shooting. This only shows a small effect on the local economy, unlike the countries that have built their own film studios, like the US, and who will be available to provide long-term employment opportunities.Figure 2 US Full/Part time/Total Employment.(Source EcoWin)It is important to note that the national employment rate is not affected b y the film industry however, it will affect the local employment rate temporarily. This is because the employment rate will only be affected while the film is shooting, unless the country builds a film studio in order to apply long-term employment. In other words, the film industry will only have a certain amount of effect in the national labor market.4.4.1 South AfricaAs the film industry may bring in some job opportunities for local people, Figure 5 shows the comparison of total employment and unemployment from 2001 to 2009, while Figure 6 shows the unemployment rate in South Africa.Table 3 in Appendix 3 shows that while the unemployment rate in South Africa in 2006 is at its lowest, the employment also starts to rise.Figure 3 South Africa Total Employment/Unemployment.(Source EcoWin)Figure 4 South Africa Unemployment Rate.(Source EcoWin)The film industry will be able to affect the employment rate locally in the short run however, it will be impacting the income rate of the local people in the long term. As Figure 7 shows below, the income rate is increasing each year it started to grow faster in 1985, and rose sharply from 2000 to 2006. Relate this to Table 5 in Appendix 3, the income in 2004 is 141167, 156270 in 2005, rising to 193678.5 in 2006. It had increased by 37408.5 from 2005 to 2006, a sharp rise. Part of the reason for this might be that the film Blood Diamond was shooting during this period. It affected the local income gradually.Figure 5 South Africa Labour Income.(Source EcoWin)4.5 CulturalCulture will show the characteristic of a country and could represent a country in some cases. In the film industry, each country will have different interests in the type of film they produce. For instance, Indian movies will be more likely to contain song and dance but in the US they prefer more a more sophisticated approach. As the song and dance in the movie are already become a feature to Indian film, this is why people had called the Hindu cinema as B ollywood3.Nowadays, people will recognise Bollywood as producing Indian films and Hollywood as producing American films this could show the affect of culture. Sometime, the living habits of a country will be reflected in the movie.4.6 TechnologyThe improvement of technology will affect the production of the economy and will have the exponent to affect the national economy as well. Where filmmakers shoot films in other countries, they might bring in some new technology. Or technology will be improved through communicating and competing with other countries. For example Avatar4 in 3D was a novelty to many people around the world and attracted a wide audience, which resulted in high box office net income. US Commercial Service (2010), it has stated that gross revenue of Hong Kongs film industry is expected to expand in the coming days because of the opening of new multiplexes and 3D cinemas, and strong government supportIf this film had been released in some LDCs, it would have crea ted an awareness and interest of some new technologies amongst the locals, who may not have seen this kind of high technique film before. It would enable let the LDCs to gain knowledge and information by the inducement of technology, or they may decide to use the same techniques used in the film in their own productions. Furthermore, the exchange of technologies between countries will cause a technology spillover.4.7 Government Policy TaxWith regards to a government helping the film industry through tax relief, Wallack (2008) quoted a report by Massachusetts Film Office showing that when Walt Disney Pictures spent $50 million filming in Massachusetts in 2006, the company have nearly $10 million in credits from the state.The action of the government can affect the growth of the film industry, as shown in the example of tax relief. Moreover, it will be able to encourage local production. The American Jobs Creation Act of 2004 included, amongst a myriad of other business tax breaks, a measure to benefit small movie production by allowing full write-off of production costs up to US$15m, at a presumed cost of US$336m. On the other hand, in the early 70s there were loopholes in the US tax system, which caused shooting to exceed budget, which had a negative effect on the economy.Chapter 5. ConclusionProduction, consumption and distribution are important in the film industry these may affect the profits that the country may earn. For instance, if a countrys production levels are high, it may increase their employment rates and distribution and may raise the reputation of the country, which might then increase investment from other countries.Every country will have to face developmental stages, which shows the improvement of each sector in the country. Take the film industry as an example not every country had cinemas from the very beginning but each started to develop as time went on. The development of the film industry might affect the economy because as people had more social time than working time in the past, they would tend to spend their time watching shows or performances.The increase of globalisation has made the film industry an internationalist commodity. The success of the film industry in Hollywood has always been an objective for most of the countries. However, terminal (1998) argued that there is evidence that the US is losing the comparative advantage in the international media market. This is because of the rise in competition nowadays most countries have their own productions in the film industry. But most of the film industries in the world were impacted by American filmmaking because it used the highest technology in this plain stitch during the films Golden Age.5.1 Implications of the StudyThe purpose of this study was to find out whether the film industry could affect a local economy. If it is a successful pathway, this sector could alert LDC governments to pay more attention to this.5.2 Limitations of the Researchnot m any scholars are pointing on the development of the film industry in a country. There is little data on this, therefore, which will impact the accuracy of this project. Moreover, problems relating to the primary research survey might affect the final result.5.3 Recommendations for Further ResearchThe film industry might be one of the sectors that the government should try to pay attention to. While it may not result in large increases to an economy, there are still benefits to be gained.Because of the word limit that applies to this project, it is not possible to cover in detail every question relating to this topic. Further research should firstly focus on whether the film could impact the income in developed countries, if yes, it may be a useful resource for LDCs. Secondly, is the level of development is important in determining, if film is going to affect the national consciousness. In addition, investigation should be made into the measures that could be uses to answer the ques tions of impact.