Stockholm School of Economics Department of Economics Master‟s thesis WHAT DRIVES THE PEN? AN ASSESSMENT OF SWEDISH CULTURAL POLICY THROUGH LITERARY OUTPUT Abstract Cultural policy makers in Sweden and abroad stress the differences between the market for art and regular markets, calling for public intervention towards compensation to artists. Such a subsidy in Sweden is the guaranteed writer‟s compensation awarded to professionally established authors to relieve them from the economic uncertainties of their occupation. This thesis aims to evaluate the accomplishments of Swedish cultural and artist policy relating them to theories from cultural economics. Using the guaranteed writer‟s compensation as a policy example, we test if assumptions on authors‟ incentives are correct. A test on literary productivity, comparing book output before and after authors become entitled to payments from the scheme, is performed. Additionally, the potential relationship between the compensation and quality, expressed using availability at libraries as a proxy, is tested. We find that receiving a relatively unconditional raise in income does affect the output of the authors through a diminished book production, whereas the impact on quality is unclear. Discussing these results on the basis of relevant cultural policy objectives we find that by primarily catering to artists‟ needs, an unconditional support might be less compatible with the fundamental intentions behind publicly subsidizing the arts. Keywords: cultural economics, cultural policy, artist incentives, creativity, literary production Authors Peter Höglund* and Samuel Persson† Tutor Richard Friberg Examiner Mark Voorneveld Discussants Kamilla Jönvik and Claudia Olsson Presentation January 30, 2009 10.15-12.00, Room 328 *
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