WHEN New York agonises over its place in the world, it is usually because it fears losing its position as the world's financial capital. That has certainly been the case in recent months. Yet Elizabeth Currid thinks that policymakers should be fretting less about credit markets and more about culture. The contribution made by art, music and fashion to the city's economy has, she argues, long been overlooked. And unless something is done about it, another crown could slip.
New York depends on art and culture not only for the quality of life but also for jobs. Culture ranks only slightly behind the securities industry in its share of the workforce. One example: the city is not far behind Los Angeles in film and video production and editing. And its artistic heritage is rich: abstract expressionists, beat writers, rappers, gods of graffiti such as Jean-Michel Basquiat. One attraction is the density of New York's creative life, squeezed into a 20-square-mile (52-square-km) grid where many of the best studios, galleries and music venues are in walking distance of each other.
Drawing on dozens of interviews with figures from the arts—from fashion executives to hip-hop producers—“The Warhol Economy” portrays a city whose cultural output relies more than ever on the social encounters that come from living shoulder to shoulder with your peers. In this business, deals are as likely to be struck on the dance floor as in the boardroom. Collaborations grow out of chance encounters. That is why, according to several studies, culture and media clusters tend to be denser than those of any other industry.
Ever since Andy Warhol began pumping films and music as well as silkscreens out of his “Factory”, a midtown studio that turned depressing weirdos into cultural radicals, New York has led the world in blending art forms to create something fresh. It has also pioneered the commercialisation of the subversive. These days, graffiti artists who were once seen as vandals do commissioned work for Adidas, Nike and the North Face. It is good to be talented, even better to be marketable.
This upsets some purists, but opens up new vistas for artists looking to extend their brand or reinvent themselves. As one band manager tells the author, a rapper can't consider himself successful if he doesn't have his own clothing line or movie. “Cultural gatekeepers” in the media—Ms Currid cites as examples the New York Post's gossip columnists and Vogue's Anna Wintour (the inspiration for the fearsome Miranda Priestley in “The Devil Wears Prada”)—play a crucial role in dictating which of these crossovers succeeds.
New York's cultural economy has reached a critical juncture, argues Ms Currid, threatened by, of all things, prosperity. The bleak economic conditions of the 1970s allowed artists to flock into dirt-cheap apartments and ushered in the EastVillage scene of the early 1980s. The boom of the past decade, by contrast, has priced budding Basquiats out of Manhattan, pushing them across the water to Brooklyn and New Jersey. Studio flats meant for artists-in-residence get snapped up by bankers. The closure last year of CBGB, a bar that became a punk and art-rock laboratory in the 1970s (and whose founder, Hilly Kristal, died last month) came to symbolise this squeeze.
Ms Currid sees this expulsion of talent as a serious problem. The solution, she argues, lies in a series of well-aimed public-policy measures: tax incentives, zoning that helps nightlife districts, more subsidised housing and studio space for up-and-coming artists, and more.
Yet is there really any ailment to cure? Manhattan remains as culturally vibrant as ever. The Chelsea neighbourhood has at least 318 art galleries, many more than SoHo, a previous hotspot, had in its heyday. Rising prosperity means more money to spend on paintings and designer shoes. Yes, many artists have moved to other areas, such as Williamsburg, in Brooklyn, but that has merely spread the hipness rather than shifted its centre of gravity.
Moreover, as Ms Currid concedes, New York's economic-development officials have a poor record in picking winners. Why would it be any different this time? New York's cultural scene is not without its problems but—as unpalatable as it may be to many fashionistas—resolving them is, for now at least, best left to the market.