The effects of public funding on the film and music industry competitiveness

Júlía B. Björnsdóttir

Student thesis: Master thesis


This paper contributes to the general debate about public funding of arts and culture from a resource-based perspective. Its research question is about the effects public funding has on the film industry and the music industry competitiveness. The proposed theoretical framework of resource-based perspective is used to structure and systemize an empirical multiple case study of the Icelandic film industry and the Icelandic music industry. Adopting the resource-based perspective to answer the research question, it is argued that the Icelandic Film Fund plays a crucial role in assembling and transforming resource bundles and capabilities into compatible feature films. Hence it improves the film industry competitiveness because the public funding system creates optimal opportunities of co-production model. The model enables a steady feature film production with secure routes to distribution channels and keeps the collective knowledge and experience within the film industry between projects. However, the Icelandic Music Fund plays a minor role in assembling resource bundles into popular music, marketing and promotion, hence lesser effects on the music industry competitiveness. A resource gap is detected in the music industry, being that the industry has too weak business process infrastructure. The weak business infrastructure hinders efficient use of the public funding in order to create capabilities and improve the industry competitiveness. It is therefore argued that public funding has different effects on the Icelandic film industry competitiveness than on the Icelandic music industry competitiveness from a resource-based perspective. As a primary contribution of this paper, and in line with the research question, this study is an attempt to understand why public funding systems have different effects on the film industry and music industry competitiveness and to gain deeper insight into the processes and problems related to creating a sustainable competitive advantage within the industries.

EducationsMSocSc in Management of Creative Business Processes , (Graduate Programme) Final Thesis
Publication date2009
Number of pages152