Elgar original reference
Edited by David Emanuel Andersson, Åke E. Andersson and Charlotta Mellander
Chapter 7: The Value of Creativity
Todd M. Gabe Some people are paid to work according to a set plan, while others earn a living from their creative ideas. Economists have a pretty good handle on the factors that influence the wages and salaries of those who ‘work for a living’. It’s all about productivity. Individuals who can produce a greater abundance of manufactured goods per hour or deliver services at a quicker pace typically earn more money than those who are less productive with their time. For this reason, plant-level investments in physical capital (for example, equipment and machinery that help automate routine and repetitive tasks) and information technology (for example, computers and digital networks that facilitate the management and transmission of information) typically enhance employee earnings. In addition, individual-level investments in human capital – actions like obtaining a college degree or learning a new skill – typically provide a productivity boost that is rewarded in the labour market. But what about creativity? Does the act of creative thinking result in higher wages? Unlike the deliberate and often scripted job-related tasks of producing a manufactured good, selling a product or providing a service, the less tangible and more spontaneous process of creative thinking does not always directly result in ‘stuff ’ that can be priced easily in a market.1 Without prices, it is difficult to determine productivity and, thus, tricky to figure out how much money someone should be paid. Looking at the numbers, we can see that creative thinking appears to be well compensated in the...
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