(For a shorter edition of this analysis, please read the condensed version.)

Ann Markusen and David King’s 2003 paper “The Artistic Dividend: The Arts’ Hidden Contributions to Regional Development” aims to reveal what economists typically miss when they measure the impact of the arts sector on regional economies. The authors describe the artistic dividend as the multifaceted economic benefits of the arts when seen through an occupational approach: a look at the ways artists, rather than institutions, feed regional economies. Using the Twin Cities region as a case study, they argue that artists create a dividend when they export their work out of the region and then spend their earnings locally, when they buy supplies and hire supporting staff, and even when they do projects for non-arts firms. Markusen and King demonstrate that artists have preferences about the regions where they live, and distill their conversations with artists into a set of recommendations for how a region can improve its attractiveness to artists. “The Artistic Dividend” is notable as the first publication of the Arts Economy Initiative at the University of Minnesota’s Project on Regional and Industrial Economics. Though it was noncommissioned, conducted without external funding, and accordingly small in scale, it is arguably Ann Markusen’s best-known work on the arts economy.


Approach and Methodology

“The Artistic Dividend” presents the arts’ contribution to a regional economy through an occupational lens. Markusen and King used the Twin Cities as a case study to explore the ways artists contribute to a regional economy. They conducted two focus groups with arts “opinion-makers” and 22 interviews with people who make their living at their art to better understand artists’ behavior, preferences, and economic effects on their region. Interviewees were contacted through a web portal for Minnesota artists or the recommendation of other individuals; they were chosen to represent a wide range of types of art but were not intended to be a representative sample of artists in the region. To establish that artists choose some regions of the country over others, Markusen and King compared artist populations between regions using Census data on size and growth rates of artistic occupations and on artistic concentrations in selected metro areas. Having determined that artists are differently distributed in different regions, the authors used the data from their interviews to probe what causes artists’ regional preferences.

Components of the Artistic Dividend

Markusen and King argue that the arts’ contributions to a regional economy are much richer than conventional research methods, such as measuring the tourism draw of a large arts institution, make them appear. Conventional, institution-centric methods overlook the contributions of artists who primarily work independently or in small organizations, and focus on a narrow set of economic benefits, such as money spent by audiences at area restaurants. By using an occupational approach, Markusen and King highlight what they call the “artistic dividend”: the varied ways in which the arts contribute to a region’s economy. They hypothesize that a high population of artists in a region increases the productivity and earnings in the regional economy, and attribute this to the following causes:

  • artists directly improve the design, production, and marketing of products and services in non-arts businesses when they do contract work for them
  • artists motivate firms to create better products by their active input as consumers
  • artists help firms recruit employees by contributing to the quality of life in a region
  • artists generate income by exporting their work out of their region
  • artists stimulate the local economy through their purchases of supplies and services.

The more obvious forms of the artistic dividend are artists’ purchases of materials and services, and sales of their work. Markusen and King list a plethora of ways the artists they interviewed patronize local businesses and employ local talent: for example, “many act like small businesses, hiring others” for support work, and “they patronize suppliers of materials, agents, teachers, and tutors.” Additionally, even in regions where the performing arts do not attract many non-local audience members, other types of artists, such as writers and visual artists, export their work from the region and contribute to their local economic base.

Markusen and King posit an additional economic impact when artists sell their services to non-arts businesses, using their writing, video, visual arts, or other skills to enhance productivity and profits, and when artists as consumers create demand for innovative products. “The presence of a large, diverse pool of artistic talent in a region enables businesses in the region to design their products better, enhance working conditions and employee morale, and market their output more successfully.” Several of the artists interviewed described successful relationships they have forged with non-arts firms.

Artists Have Regional Preferences

“The Artistic Dividend” shows artists concentrate in some regions more than others. Using data from the Integrated Public Use Microdata Series based on the 1980 and 1990 US Census, Markusen and King compiled the size and growth rates of artistic occupations (using the categories for full-time artists, musicians, actors and directors, painters, photographers, and dancers) in eleven cities. They then compared artistic concentrations for those cities, using a location quotient for artists – the ratio of artists in a local economy to artists in the national economy.

This method revealed that the fastest growing or biggest cities do not necessarily have the biggest artist populations, and different types of artists are concentrated in different cities. Markusen and King theorize that smaller cities that have high populations of one type of artist attracted that population in part because of a major school or other institution. Based on their focus groups and interviews, they highlight factors such as opportunities for education, mutual support networks among artists, opportunities to connect their work to other industries, lower cost of living, and higher quality of life as important components of a region’s appeal to artists.

Nurturing the Artistic Dividend

“Artistic activity as a significant contributor to the regional economy needs nurturing,” Markusen and King write. “In comparison to the very modest amounts they devote to the arts, state and local governments pour hundreds of millions of dollars into downtown revitalizations, new plant attraction and even big box retail developments in the suburbs.” The paper argues that redirecting some money towards attracting, nurturing, and retaining artists would allow the artistic dividend in a region to flourish.

The authors recommend that arts funders, governments, businesses, and artists’ organizations focus on attracting and supporting artists as workers. This includes supporting dedicated artist live/work spaces, but also encouraging amenities that are not specific to artists, such as a region’s affordability, vibrant neighborhoods, and cultural life. Markusen and King call arts-supporting philanthropic organizations and arts establishments a “welcome mat” for a region, indicating to artists that they are likely to find a friendly environment there. They conclude from their interviews that a thriving network of formal and informal artist organizations is as important as big establishments to retaining artists, helping artists find venues to sell their work and hone their artistic and business skills, and providing other resources. Their recommendations are accompanied by anecdotes from their interviewees describing ways in which regional features have helped them succeed.

Art Sale by Jeff_Werner on Flickr

Art Sale by Jeff_Werner on Flickr


Overall, “The Artistic Dividend” makes an intriguing argument that using an occupational approach to look at the arts’ role in regional development reveals many contributions that are invisible with methodologies that focus on the arts industry or arts establishments. Its conclusions about improving a region’s attractiveness to artists and thus its economic success are preliminary, however, because of its modest scope and reliance on limited empirical evidence. “The Artistic Dividend” is promising as a quantitative and descriptive look at artist concentrations in major American cities, as well as a small-scale exploration of artists’ lives, careers, and relationship to place within a single metropolitan region. It would also be provocative as an opinion piece on the value of using an occupational lens to measure artists’ contributions to a regional economy, but it is not presented as an opinion piece. Instead, the authors attempt to use the data from their interviews and focus groups and (by implication) the data on artist concentrations to demonstrate the value of an occupational lens for this purpose, and make policy recommendations on the assumption that the value has been demonstrated. In this area, the paper falls short, raising a lot of interesting questions without enough supporting evidence to justify its recommendations.

To a large extent, Markusen and King are upfront about “The Artistic Dividend”’s limitations. For example, the study excludes the effects of part-time and unpaid artists on the economy, two groups which make up a large portion of the total number of artists in a region. It focuses on metropolitan regions, and the Twin Cities in particular, to the exclusion of examining arts dividends in small towns.

However, there are several key weaknesses in the paper’s construction that go unacknowledged. The major quantitative source of information in “The Artistic Dividend,” the analysis of artist concentrations, cannot tell us anything about whether the artistic dividend exists or how big it is because the authors use those concentrations as evidence of the artistic dividend itself rather than as a lever for measuring its relationship to regional prosperity. This leaves the job of demonstrating the dividend to the nonscientific sample of 22 interviewees in a single region, which is a very small base of evidence from which to draw sweeping policy conclusions.

Similar leaps of logic occur in the authors’ analysis of the nature of the dividend. For example, profiled artist Vara Kamin has written audio and film scripts for a medical technology company, an example of the artistic dividend in action. The authors of the study assume an artist like Kamin produces more valuable results than a non-specialist from within the firm: “artists often sell their work or services to other firms and organizations in the region, helping to make them more productive by enhancing the quality and design of their products or enhancing the work and customer environments.” While such an outcome certainly seems possible, the claim is neither made explicit nor demonstrated or supported with evidence in the paper.

Markusen and King go on to suggest that we could see growth in artists like Vara Kamin selling their skills to non-arts firms, which makes sense if both artists and companies really embrace the creative possibilities in their collaborations. However, as countless artists’ rants and anecdotes published as blog posts or interviews reveal, many artists do not consider such gigs to be their “real” work. The authors note from their interviews that “some artists express disdain for commercial uses of their art… or fear this would damage their status as fine artists.” Yet they continue to express optimism that this is a part of the dividend which could blossom with some encouragement.

The seams between the opinion, census analysis, and anecdotal elements of “The Artistic Dividend” become particularly problematic when the paper makes far-reaching recommendations based on earlier generalizations. For example, the authors propose that a region can attract and retain artists to boost the artistic dividend. In the section analyzing census data on concentrations of artists by profession in various metro areas, the authors note, “each metro has stylized itself in some fashion as a nurturing ground for certain arts and as a destination for artists in that field.” The idea of a city styling itself for certain professions makes the actions sound deliberate on someone’s part. There is a big logical leap between the idea that artists cluster in certain regions and the idea that those regions are deliberately cultivating the presence of specific artistic professions over others. Markusen and King later recommend that cities deliberately cultivate artists, and this section implies it has been demonstrated to be possible.

The authors assert that “it is impossible to directly measure a region’s full artistic dividend.” While it is true that measuring the economy is an inexact science and a “full” accounting may be an unreasonable goal, the authors’ hypothesis that “the more diverse and sophisticated and sizable the pool of artists in a region, the higher the quality of [their] services with associated positive impacts on firms’ bottom lines” is certainly measurable. For example, comparing their data on regional artist populations to measures of regional prosperity, as Richard Florida did, could have provided a fuller picture of whether the artistic dividend has any noticeable effects. Alternatively, as mentioned in the study’s conclusion, including non-arts business owners who do and do not hire artists in the focus groups and interviews could have bolstered the case for the artistic dividend. Unfortunately, by declining to attempt a measurement of the artistic dividend, the meaningful existence of which is the crux of their arguments and recommendations, Markusen and King leave their argument open to the speculation that the dividend is not in fact large enough to justify their recommendation that regions invest in encouraging it.

Moreover, the paper leaves open the question of whether the artistic dividend is distinct from that of other fields when using an occupational approach. While the authors acknowledge in the conclusion that they did not compare the arts to other occupations, it is a surprising omission considering how central the arts’ net value to regional economies is to the paper’s argument, and even more so because Ann Markusen had not specialized in the arts until this study. The only other field explicitly mentioned by comparison is professional sports. The way in which the authors define artistic occupations is somewhat curious as well: they argue that exports of artistic products out of the region are a component of the dividend, but omit filmmakers; they use an artist’s successful venture selling fonts he designed as an example of artistic entrepreneurship even though they omit graphic designers on the grounds that they are more likely to be employed full-time. It is not clear why the lines are drawn where they are, and what unique economic contribution is made by the artists they do include relative to other occupations.

Ultimately, Markusen and King aim to demonstrate that an artistic dividend exists and that it is worth exploring in further research. Artists are indeed economic actors in that they buy supplies, hire services, and do arts work for non-arts firms. Through the results of their focus groups and interviews, the authors identify the building blocks they believe form an artistic dividend in their case study region, the Twin Cities. However, to persuasively argue that cities, philanthropists, and others should make changes to their practice in service of increasing the artistic dividend, the authors would need be able to measure the dividend itself and show that it has some significant effect on the regional economy.

The Artistic Dividend Revisited

Markusen’s 2004 paper “The Artistic Dividend Revisited,” co-authored with Greg Schrock and Martina Cameron, updates the Census-based analysis of artists’ regional preferences from “The Artistic Dividend,” adding a comparison with architects and designers, and examines the pull of employers on artistic concentrations using advertising as a case study. “Revisited” goes into more depth using 1980, 1990, and 2000 PUMS Census data. It does a better job contextualizing the claims about what makes a region appealing to artists within the landscape of existing research than “The Artistic Dividend” does. It does not make the implication that the artistic dividend is necessarily a large part of regional economies, which is where “The Artistic Dividend” began to overreach. Instead, Markusen, Schrock, and Cameron provide a deeper, more thorough version of the original paper’s strongest portion, arriving at many of the same conclusions: artists tend to be footloose, the concentration of artists in a city is not a function of the city’s size or growth, and cities tend to be associated with a few types of artist.


“The Artistic Dividend” provides a good frame for the discussion of artists’ economic contributions. However, the constraints on the scope of research result in limited evidence to support the paper’s claims about how exactly artists contribute to the economy, and what it takes to attract and nurture them. Not surprisingly, then, “The Artistic Dividend” concludes with a call for more research. The authors suggest documenting “the significance of and delivery mechanisms for the artistic dividend,” how and how much artistic entrepreneurship contributes to a region’s economic base, and the reasons artists choose to live in particular cities. They recommend similar research on the artistic dividend in sub-regional and neighborhood economies (I would add rural regions to this list). The authors see a pressing need for thorough evaluations of the trade-offs between funding large arts institutions and funding on the artist level, and between funding the arts and other economic development strategies.

In the past decade, discussion of the occupational approach to looking at the economy has become increasingly common, although there has yet to be a good comparison between the creative economy and other occupational economies using this lens. In “Crossover: How Artists Build Careers Across Commercial, Nonprofit, and Community Work,” (2006) Markusen et al. surveyed artists in Los Angeles and the Bay Area and found that a high number of working artists earn income from multiple sectors. However, since work for non-arts firms and direct sales of art to consumers are both counted in the commercial sector, the findings in “Crossover” do not help us understand how these two pieces operate as separate avenues for artists to participate in the economy, as they are treated in “The Artistic Dividend.” Markusen’s “Defining the Cultural Economy: Industry and Occupation Approaches” (2008) described the differences in definitions of the cultural economy, including whether to look at part-time workers and which professions make up the cultural sector. However, the literature on the creative economy that uses similar definitions and parameters to Markusen and King’s artistic dividend is still heavy on analyzing methodology and theory. It is light on gathering and analyzing data about how the artistic dividend compares to the economic effects of other occupations, how large existing regional artistic dividends are, and what really works to stimulate the artistic dividend within a region.

It is important to consider that “The Artistic Dividend” was written before the 2008 recession. The recession changed the game in some areas of regional development and older assumptions must be questioned, like the assumption that job growth lessens poverty and inequality in a region. These changes suggest that greater access to affordable health care and other fundamentals may now be more important to artist populations than regional amenities such as parks. Markusen has pointed out that artists don’t fit in either traditional micro-economist or macro-economist arguments about how government spending in recessions work, because they are likely to spend new money rapidly and in the local economy.

I would also be interested to learn about the effect of the crowdfunding movement on artists’ attachment to their regions and on their ability to export out of their regions. Projects funded on Kickstarter, Indiegogo, and similar sites are allowing artists to tap into new markets (across the country and the world) and a greater ability to fund their work without relying on local institutional funding sources, but for the most part, the size of the impact remains to be analyzed.

While “The Artistic Dividend” was only a start, the broader question of the role the creative economy has in the larger economy is a valuable one. Changes such as the recession and crowdfunding have encouraged many artists to try to make it on their own, whether that means relying more heavily on freelancing or exploring unconventional avenues of funding. Looking at artists’ economic participation through an occupational approach, then, continues to be highly relevant.

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