Creative Inputs as the Cause of Baumol's Cost Disease: The Example of Media Services

Preston, Paschal; Sparviero, Sergio

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Creative Inputs as the Cause of Baumol's Cost Disease: The Example of Media Services

Journal of Media Economics, Vol. 22, No. 4, pp. 239- 252

20 Pages Posted: 6 Jan 2010 Last revised: 30 May 2012

See all articles by Paschal Preston

Sergio Sparviero

University of Salzburg

Date Written: December 30, 2009

Abstract

This article explains that the most important aspect of W. J. Baumol's idea of cost disease is the fundamental intuition that there are some types of labor's contributions that are irreplaceable by new technologies. These contributions are indentified as “creative inputs”: original ideas, concepts, actions, and inductive solutions to ill-defined problems. This article also empirically demonstrates that media content activities are stagnant, whereas activities involved in the distribution and exhibition of media content are progressive.

Keywords: Baumol Cost disease, media services, media industries, creativity, innovation, service industries

JEL Classification: L80, O31

Suggested Citation: Suggested Citation

Preston, Paschal and Sparviero, Sergio, Creative Inputs as the Cause of Baumol's Cost Disease: The Example of Media Services (December 30, 2009). Journal of Media Economics, Vol. 22, No. 4, pp. 239- 252, Available at SSRN: https://ssrn.com/abstract=1531555