Chris Koney’s column: How the entertainment industry shapes national economies

Over the past decade, we have witnessed how big concerts of hip-hop musicians and other artists influenced not just the people but economies all together.

However, nowadays this influence has spread to film industries too, as we have witnessed with ‘Barbihimmer’ debut. Let us delve into how the new waves in the entertainment industry shape our economies of today.

Entertainment industry, at large, encompasses many fields: film, television, music, gaming and more. Today, each of these branches of the industry makes out over US$20billion separately in just a year.

For instance, in less than a month, a single ‘Barbie’ movie with Margot Robbie has made over one billion dollars in revenue, breaking all the previous records in the history of the film industry. Such shocking numbers make us only wonder what the entertainment industry is about to bring out into our economy.

Relating it to our economy, it is believed that the entertainment industry, like any other, creates jobs, generates cash and increases overall demand. However, the industry’s influence within a single nation is never considered in more detail. It starts a cascade of economic activity, such as the demand for local labour, tourism, food, accommodation and transportation services.

For instance, the recently emerging wave of K-pop, which was driven by BTS and Blackpink, significantly influenced South Korea’s economy. The export value of K-pop-related goods and services climbed from over US$40million in 2003 to over US$5billion in 2018, according to data from the Korea Creative Content Agency, reflecting an average yearly growth rate of 31.9 percent.

The contribution of K-pop and K-drama to South Korean GDP has also expanded dramatically throughout the years. According to a Hyundai Research Institute research, the K-pop industry contributed 1.7 percent of South Korea’s GDP in 2018, up from 0.3 percent in 2009. According to the analysis, the industry’s contribution to the country’s GDP might climb to 3 percent by 2020.

Additionally, K-Pop stocks have increased by US$5.4billion in 2023 as a result of the industry’s high quarterly profitability and a rise in the popularity of pop culture worldwide. Along with the monetary advantages, more than 160,000 foreign students started learning Korean and enrolling in Korean universities. Overall, K-pop has developed into a sizable economic force with a profound effect on many facets of society and the country as a whole.

The entertainment industry’s rapid waves of economic activity sometimes induce unforeseen economic shocks. The impact of Beyoncé’s concert in Sweden serves as a prime example, where inflation unexpectedly surged to 9.7 percent, as reported by BBC News. The concert announcement triggered a wave of accommodation searches, sold-out tickets and soaring resale market prices. Demand for tickets during the initial sales outstripped supply by almost 800 percent, showing a good example of the economic aftershocks caused by entertainment events.

In the United Kingdom, Beyoncé’s concert drew 60,000 attendees from diverse corners of the world, resulting in heightened demand for hotel rooms. The spectacle even displaced some homeless families from their temporary accommodations, underscoring the immense pull of entertainment on global migration patterns.

The enormous success of Taylor Swift’s ‘Eras’ tour further emphasises the effects of entertainment on the economy. Given that there has been significant spending at each location on the Eras Tour, the effect on L.A. is hardly unexpected. According to a report released in June by the online survey and research firm QuestionPro, the entire tour will have an approximate US$5billion economic impact. It claimed that the typical concertgoer spent more than US$1,300 on expenses for tickets, merchandise, lunches and other things.

Relatively recently, the release of the ‘Barbie’ film not only benefitted Mattel’s (MAT) stock price, but also had far-reaching effects on the economy as a whole. The movie’s success translated into soaring sales of toys, clothing and merchandise adorned with the iconic Barbie design, amplifying its economic impact.

The entertainment industry has an impact that goes beyond first impressions, and ignites a boom in economic activity. Far from causing negativity, this sector plays a pivotal role in supporting diverse economic sectors and acting as a safeguard against recession, buffering against short-term inflation spikes and housing market fluctuations. The relation between entertainment and economy is an intricate process that continues to reshape nations’ economic landscapes.

Source: www.streetfins.com

>>>the writer is a thought leader in Marketing Communications, Stakeholder Relationship Management Professional and International Cooperation Specialist. Over the last fifteen (15) years, he has made tremendous impact within Africa’s corporate communications and creative arts sectors. He can be reached at [email protected] / 233 20 854 1480.

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