This week over 150,000 people will descend on the village of Boduan, Gwynedd for the 2023 Eisteddfod Genedlaethol.听 The focal point of the Eisteddfod Maes (鈥渇ield鈥) is the Pavilion 鈥 the main stage where some of Wales鈥檚 leading writers, musicians, poets, and dancers compete to be crowned the best of the best.听 Although primarily a competitive event, the festival element of the Eisteddfod has grown in recent years and the event has become a showcase of Welsh creativity.
On the Friday of the Eisteddfod, the winner of the Albwm Cymraeg y Flwyddyn (鈥淲elsh language Album of the Year鈥) will be announced.听 This award, which is organised jointly with BBC Radio Cymru, is a celebration of Welsh music, especially young and up and coming artists.听 It is interesting to see how these artists develop in the modern music industry.听 At one time the recording studios would given music artists money to allow them to take time to write songs, develop albums, and pay for time in the studio. 听Today, artists create their own music in the bedroom or garage, upload their music onto the internet, generate their own fan base on digital platforms, go gigging, and then repeat the process.听
Changes began to happen in the 1980s.听 Before then, the music industry was funded by the big record companies 鈥 they were basically the banks for bands as they funded the recording of albums, the first tours, etc.听 That whole model was destroyed by digitalisation and the emergence of new services such as Napster.听 The record companies initially ignored Napster and the digital transformation.听 But Napster led on to Apple鈥檚 iTunes, which led to Spotify.听
The music industry is a great example of the relentless gale of creative destruction; that is, what Schumpeter meant by what makes capitalism works.听 Every time a record company thought it had a competitive advantage or dominant position, some start-up company came in, changed the model, changed the way consumers behave, and ultimately destroyed the original company.听 But in the destruction of the company a new and more creative version is created.听 According to Schumpeter capitalism is a relentless process where the old is churned into the new and the new churns back into the old.听
The economy is driven by creativity.听 One person鈥檚 creativity has the seeds of another鈥檚 destruction, and their destruction leads them to do better things. 听If you look what is happening around the world and throughout history, it seems to be an interesting way (but not the only way) of looking at how the economy grows.听 Schumpeter鈥檚 idea was that economic growth comes from the creative genius of the mind, and this creativity cannot be stopped.听 The economy can be viewed as this unbelievable creative force that is always coming up with new ways of doing things.听
This week Eisteddfod shows that Wales has ample creativity. 听It is in our blood.听 It鈥檚 time to unleash this creativity to drive the economy forward.
Dr Edward Thomas Jones is a financial economist and senior lecturer at Bangor Business School.