Hollywood's Economic Migrants

Return on Capital Employed

What do Kate Winslet, Hugh Laurie, Sacha Baron Cohen and Dame Hellen Mirren have in common? More to the point, what do they have to do with a business blog?

The answer to the first is, they’re all talented British thespians who had to go to Hollywood to earn global fame and fortune. They’re also economic beings- human capital- who moved to the market where they would earn the highest financial return on their talent.

But why is the UK not the most profitable market for their talent capital? The Times today wrote this article, lamenting the fact that the UK film industry is addicted to government subsidy. Astonishingly, it then concludes with the alarming assertion that the solution to the industry’s woes is for the government to finance a movie production sector.

We would like to gently point out to the Times that there’s no government-financed movie sector in Hollywood. We’d also gently suggest that this is precisely why it nurtures a more succesful and profitable fim industry than the UK.

The European intinct to look to the Great Government Benefactor is again evident. Subsidising the BBC with mandatory TV licences or propping up all manner of theatrical companies that produce material so atrocious no-one would pay to watch it, just prevents the market from uprooting the weeds and nourishing the blossoms.

Any movie that can coax the price of a ticket from a citizen’s wallet will also coax a pound from an investor’s coffers.