The economic and employment impact of the arts and music industry : hearing before the Committee on Education and Labor, U.S. House of Representatives, One Hundred Eleventh Congress, first session, hearing held in Washington, DC, March 26, 2009.

Chris Anderson's initial `Long Tail' analysis was released in 2004 just as the wave of mergers and acquisitions was sweeping the music publishing and radio industries. Music industry executives began looking for Anderson’s ‘Long Tail’ effect and with it the implied redistribution of royalty income from popular songs to long dormant and forgotten works in their catalogs. These music publishers had hoped to further maximize the value of their copyright assets (lyrics and melody) in their existing music catalogs as the sale of compact disks diminished, and consumers switched their purchasing and listening habits to new digital formats in music technology such as the iPod. This book deals with the measurement of skewness, heavy tails and asymmetry in performance royalty income data in the music industry, an area that has received very little academic attention for various reasons. For example, the pay packages, including signing bonuses, of some `superstars' in the sports world are often announced when they join a team. In the art world, the value of an artist's work is sometimes revealed when the work is sold at auction. The main reason it is difficult to study art and culture from a royalty income perspective is that most of the income data at the individual level is often proprietary, and generally not made publicly available for economic analysis. As a Senior Economist for the American Society of Composers, Authors, and Publishers (ASCAP) using both internal and licensed external proprietary data, the author found that the so-called `superstar effects' are still present in performance royalty income. Success is still concentrated on a relatively few copyright holders or members who can be grouped into `heavy tails' of the empirical income distribution in a departure from Anderson's `long tail' analysis. This book is divided into two parts. The first part is a general introduction to the many supply and demand economic factors that are related to music performance royalty payments. The second part is an applied econometrics section that provides modeling and in-depth analysis of income data from a songwriter, music publisher and blanket licensing perspective. In an era of declining income from CD album sales, data collection, mining and analysis are becoming increasingly important in terms of understanding the listening, buying and music use habits of consumers. The economic impact on songwriters, publishers, music listeners, and Performance Rights Organizations (PROs) is discussed and future business models are evaluated. The book will appeal to researchers and students in cultural economics, media and statistics as well as general readers and professionals in the music publishing industry.

This book represents a collection of 7 works by authors arguing for the support of public spending on the arts: (1) "Introduction: The Value of Economic Reasoning and the Arts" (Harry Hillman-Chartrand), examines the changing social perception of the arts over time, and describes the interaction among the sectors of the arts; (2) "Arts Impact Studies: A Fashionable Excess" (Bruce A. Seaman), questions the theory underlying studies that measure primary spending associated with art activities for the arts are seen as having an important role in local economic development by improving the social infrastructure of communities and by enhancing the quality of human capitol within a region, a role which is not quantitatively measurable; (3) "Economic Impact Studies of the Arts as Effective Advocacy" (Anthony J. Radich and Sonja K. Foss), explores the ways in which five illustrative economic impact studies were tools of effective advocacy for the arts by achieving communication between arts advocates and representatives of business and government; (4) "Improving the Design and Policy Relevance of Art Impact Studies: A Review of the Literature" (David Cwi), reviews impact studies in 16 states, discussing the terms of reference and content of those studies faulting the typical study as doing less to assist its sponsors in arts policymaking than such studies could; (5) "The Role of the Arts in State and Local Economic Development" (R. Leo Penne and James L. Shanahan), indicates that, in the postindustrial society, the arts are amenities that attract and retain talented people, foster the spirit of innovation and adventure, convey a positive city image, and thus are real contributors to local economic development; (6) "Evaluating Cultural Policy through Benefit/Cost Analysis" (William S. Hendon), advocates and describes procedures for explicit and quantified cost benefit analysis; and (7) "Economic Structure and Impact of the Arts: Comparison with the Nonarts" (James H. Gapinski), completes the selection of articles with the common message that the arts have a pervasive, positive effect on local economies. A glossary, a bibliography, and a section about the authors follow. The book is indexed by subject, name, and studies cited. (MM)