_The Cultural Trade Index_ Page | **11** of **14**

is a meaningful concept only where there is a relationship, someone to do the valuing.”<sup>24</sup> We all do our own valuing, and we often attach other meanings to value. But as far as GDP is concerned, it must be remembered that this metric just measures ‘exchange value.’ And apart from intrinsic value, it does not measure public good aspects or externalities for that matter. There is a lot we cannot tell (to recall a useful phrase). As Herbert Simon argued, “people are not able to acquire and digest all available information about every topic, so their rationality is ‘bounded’ (limited).”<sup>25</sup> This condition is common. And it is alive and well in the arts and development debate, especially when it comes to the valuation process. What is more, there is a misconception that price equals value. There can be some relationship. Nevertheless, recall that this does not entirely mean that expensive things are valuable or that cheap things are not valuable.

Second, in the process of accounting, in the arts sector, piracy is a common problem. But just because this problem is common, it does not mean it is well understood. Moreover, as some have argued it does not mean that money lost via piracy is money lost all together in the economy.<sup>26</sup> People can spend this money elsewhere and still keep GDP humming. Nonetheless, artists and businesses that directly and indirectly generate income from such creative commerce are likely to be left at a startling disadvantage. At any rate, while revenues lost via piracy are significant, they are almost impossible to pin down.<sup>27</sup> And it must be remembered that many artists and creative businesses function in informal structures. While this informality is normally invisible in official statistics, it does not mean that it is illegal altogether (or, for that matter, that informality does not contribute to economic welfare).

Third, there is also the ethical dimension. In the creative or cultural economy, cultural tourism as one example can be rife with ironies and ethical dilemmas.<sup>28</sup> While this area has potential to contribute to development, the concerns of cultural exploitation and uneven prosperity can undercut its promise. Other sectors, from finance to housing, are not immune from ethical traps. But given the political and social sensitivity of culture, measuring cultural or creative tourism cannot be seen merely as a way to legitimize this sector. The accounting here is unlikely to winnow out the pitfalls that may cause cultural and social impairment.<sup>29</sup> Fourth, on satellite accounts:<sup>30</sup> In the cultural sector, satellite accounts are expanding. In the first-ever groundbreaking partnership in the United States, the Bureau of Economic Analysis teamed up with the National Endowment for the Arts to develop an “Arts and Cultural Production Satellite Account” (ACPSA). This new account would “identify and calculate the arts and culture sector’s contributions” to GDP.<sup>31</sup> <mark>But inasmuch as political debates continue to focus on economic growth, accounts labeled ‘satellite’ might have a hard time becoming influential.</mark><sup>32</sup>

> 24 Robinson 2013, p. 36.

> 25 Kishtainy and others 2012, p. 52.

> 26 See Plumer, 2012.

> 27 Ibid; see also Kabanda 2016b, p. 5.

> 28 See Kaul 2009, p. 6.

> 29 Trask 2000. See also Chris Gibson and Connell, 2005; Kaul 2009, 6; and Harris and Moreno.

> 30 “A Satellite Account is a term developed by the United Nations to measure the size of economic sectors that are not defined as industries in national accounts. Tourism, for example, is an amalgam of industries such as transportation, accommodation, food and beverage services, recreation and entertainment and travel agencies.” UNWTO, p. 1; see also Kabanda 2014, pp. 51-52. 31 NEA 2012. See also BEA 2016.

> 32 Coyle 2014, p. 138. Regarding the efficacy of such accounts, climate change is a perfect example.  “Some countries have been publishing satellite accounts on the environment for a number of years.”  Yet “it is hard to identify any direct influence they have had on economic policy debates.” — Coyle 2014, p. 138.