- New Horizons in Institutional and Evolutionary Economics series
Chapter 5: Creativity under Competition and the Overshooting Problem
with Peter Earl Prolegomena This paper was written in 2009 when Earl audited one of Potts’s lectures on Hyman Minsky’s ‘financial instability hypothesis’ and realized that a similar argument could be made about the competitive organizational dynamics of creativity. This is a truncated version of a longer paper yet to be published. 5.1 INTRODUCTION A widely observed phenomenon in the creative industries is the tendency for creative budgets to blow out and for creative concepts to escalate in complexity as suppliers chase ever-shifting norms of what is hip, cool, hot, or attention arresting. Infamous examples lie in the creative excesses of ‘prog rock’ bands of the 1970s, or in any turn toward debauchery, selfreferential excess or kitsch in modern art. But this phenomenon is, we argue, to be found everywhere creativity and competition meet. It is not a uniquely modern form of decay but a logic of competition with predictable pathways and consequences. Our hypothesis is that creative agents tend to compete by going deeper into their repertoire of ability and talent, which adds further depth, meaning, subtlety and complexity to their creative product, whether an album, a script, or a design concept. But as this happens, the norms of the genre become more complex through further layering of additional depth, meaning and detail. This creative competitive process can thus become an aesthetic ‘arms race’ that will systematically tend to overshoot consumer capabilities and demand (as with Minsky’s (1975) Keynesian monetary dynamics model of debt overshooting). Interestingly, this occurs much...
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