Inside a Hollywood heist The MPAA and the dark world of Hollywood’s political privilege play (within U.S.) jurisdictions off each other to gain tax credits and direct subsidies, to very poor returns for state governments and residents. I’ve seen many such articles in the past, eg last year The Upside-Down Math of Film Subsidies. I’d appreciate pointers to a comprehensive study, for the U.S., any other jurisdiction, or worldwide.
Inter-jurisdiction subsidy competition is obviously bad, allowing corporations to shop around for the most gullible or corrupt jurisdiction. Film subsidy competition seems much like professional sports team arena subsidy competition, additionally because both seem shiny, have lots of cultural relevance, and have monopoly aspects. In the case of teams, the supply is restricted. In the case of movies, there are only so many hits. In both case, IP plays a strong role in creating and maintaining concentrated interests which are better able to extract rents from governments in addition to their property privileges, resulting in these industries further pushing us toward a future of gross inequality, control, and conflict.
Articles decrying subsidy competition rarely offer any solution other than hoping everyone realizes the arrangement is ridiculous and stopping, and the two linked articles are no different. But I’ll note three here, going from most similar to everyone stopping to most incremental and knowledge specific:
- Outlaw civic extortion, large businesses negotiating with several jurisdictions for ever larger public subsidy. This has nothing to do with knowledge directly, but somewhat disfavors IP/freedom infringing industries which are concentrated enough to successfully gain such subsidy, examples above. It is also pro-commons in a broader-than-knowledge sense, considering government as a commons, as a method of protecting government from private raiding.
- Mandate that any works created with public subsidy be not subject to freedom infringing regimes (copyright, patent, trademark, etc). This is a natural extension of the limited application of this principle so far (e.g., for some government and publicly funded works, especially educational and scientific) to entertainment and culture, but has also been independently invented by critics of sports team subsidy and behavior. In some cases the team/studio would reject the subsidy. In others, presumably in particular where subsidy is more a matter of very substantial cultural funding and less of inter-jurisdiction shopping (I imagine Europe) are provides a larger share of costs, the production would be added to the commons.
- Commons-based competition to the studios, first expanding policy imagination through existence proof, then slowly by creating a different path for creating culturally relevant productions which erodes their profitability and thus their constituency for protecting their subsidies and IP. As this competition increases, the demand for the second item (public funding=public domain) will increase, and vice versa.
Tile a play on How Movie Studios Exploit Video on Demand Services.