HOW HAS ANIME IMPACTED THE JAPANESE ECONOMY?

How do entertainment industries generally impact the economies of nations?

One might assume that a straightforward transaction exists between entertainment and economies- a simple cycle of demand and creation of employment through consumption. 

While the definition of entertainment is up for debate (maybe even subjective); it is undeniable that it plays an important role in driving national growth, shaping culture and narrative, providing commentary on the social, economic, political and even, scientific circumstances.  An ever- evolving art impacting an industry that is growing faster than ever. 

A question that is extremely compelling in new age entertainment is- Is this seemingly recreational industry driving national growth? If so, by how much?

The industry walks hand-in-hand with a history of creating culture, of making waves about the unspoken facets of society, of influencing not just psychologically, but also, pragmatically and actionably. 

• This (nearly) 3 trillion dollar industry includes movies, TV shows, books, video essays, gaming, theatre, short-form content and everything in between. 
• When we look back to huge moments in the entertainment industry- it is obvious that it influences on a grand scale. Whether that be the Barbihimmer debut or the scope of South Korea’s national economy after Blackpink and BTS (maybe,even K-Pop in general) became mainstream. 
• The entertainment industry drives growth in other sectors during tourism, accommodation, food and transportation services. 

What is anime?

From a global perspective, anime includes all the animations or cartoons that come from Japan. They are generally characterised by blazing graphics, energetic characters and attractive themes such as romance, supernatural forces and sci-fi. These animations are heavily inspired by mangas ie. graphic novels or comic books; their identity entirely linked to the nation they were birthed in. 

The market size of the anime industry is 31.2 USD as of 2023 with a CAGR of 9.2%. 

CONTEXT 

Anime is the third largest industry in Japan. The revenue generated by the sale of anime-related goods to the United States far surpasses Japan’s steel exports to the United States. How does that happen?

Originally, anime was quite a stunted art form. Few funds, unwelcome creative decisions and a lack of frames. However in 2009, when Japan was making its recovery from an economic recession, their Prime Minister Taro Aso declared that Japanese content- particularly animes and mangas would drive growth for the nation- attract consumers within and beyond borders alike. 

While Studio Ghibli paved the path for Japanese media, today, shows like Pokemon, Attack on Titan, Naruto and Death Note have garnered great fonder and applause.

At first, the production committee comes into the picture. The anime production committee is composed of all the entities who have a financial interest in the anime. Ad agencies, book publishers, game developers and more can be on the production committee.

The investors provide the capital necessary to create the anime and have a fair amount of control over the production. The studio creating the anime doesn’t own the intellectual property, the rights lie in the hands of the stakeholders.

The money being paid to studios has remained low despite the growing international streaming market that means the industry is flowing with more money than ever before. Some worldwide streaming contracts are large enough to ensure an anime is profitable before the first episode has even hit TV screens.

But this increased revenue is primarily being shared among production committees, as studios continue to struggle financially and go bankrupt even against the backdrop of an otherwise-thriving industry. This has resulted in poor working conditions for animators. Anime is almost entirely drawn by hand. It takes skill to create hand-drawn animation and experience to do it quickly.

Overall, it is clear that regardless of extent, there is a strong relationship between the economy and anime of Japan. While anime has been affected by Japan’s current and past economic cycles, it has also added significantly to the Japanese economy.

IMPACT OF ANIME

• TOURISM 

Tourists from all around the world come to Japan to experience the dynamic nature of the cities that they often witness in animes. Cities like Tokyo, Kyoto and Hokkaido have become popular tourist attractions. People often go to anime- themed restaurants and cafes and merchandise shops. Even the government recognised the potential of a boost in the tourism sector if a dogma of anime was facilitated and has actively been promoting it since 2019.

• CULTURAL REPRESENTATION

With a global audience, anime has managed to make the Japanese culture accessible, understandable and desirable. According to a report by the Ministry of Economy, Trade, and Industry, the export value of anime-related products increased by 8.7% in 2019, with a total value of $3.4 billion. This includes products such as DVDs, merchandise, and licensing fees. The popularity of anime in different parts of the world has also led to an increase in demand for Japanese products, which has further contributed to the growth of the country’s economy.

• FASHION TRENDS

The popular anime series, “Attack on Titan” created a market for a military-esque jacket. Or the culture of casual streetwear that has been cultivated in Japan and is gaining fame in the rest of the world is proof for the reach of Japanese entertainment and culture. 

• JOB CREATION

One of the most significant impacts of anime on Japan’s economy is job creation. The anime industry has created thousands of jobs for people in different sectors, including animation, production, marketing, and distribution. According to a report by the Association of Japanese Animations, the industry created 153,000 jobs in 2017, with an estimated value of $19.5 billion. This has not only helped to reduce the country’s unemployment rate but has also contributed to the growth of other sectors such as hospitality and tourism.

• TECHNOLOGY AND INNOVATION

As bizarre as it may sound, this entertainment industry has been more simply recreational. Many of the sci-fi elements of these shows have managed to construct such a deep intrigue amongst the Japanese folks that they have taken to bring these elements to life. 

The anime series Gundam, which depicts giant robots fighting in space, has inspired the creation of real-life robots by several Japanese companies. The robots are used in various industries, including healthcare, manufacturing, and entertainment. Additionally, anime-inspired video games have contributed to the development of gaming technology. For example, the popular video game series Final Fantasy has influenced the development of gaming graphics and storytelling.

Or the anime series Akira which exhibited a futuristic world with hoverbikes. Aerofex is a company that took to making this future our reality. 

With the emergence of virtual reality, anime experiences are likely to become far more immersive, extravagant and holistic. 

FORESEEABLE CHALLENGES FOR THE INDUSTRY AND HOW TO RECOVER

• PIRACY

Perhaps one of the primary problems for the entertainment industry as a whole has been piracy. Huge amounts of revenue is lost as a consequence of said problem. 

One of the biggest changes in the anime industry in recent years has been the rise of streaming services such as Netflix, Crunchyroll, and Funimation. These services have made it easier than ever for fans to access anime content from anywhere in the world, and have also provided a new revenue stream for anime studios.

However, this shift towards streaming has also led to concerns about the quality of anime being produced. With studios focusing on producing content that will appeal to a global audience, there is a risk that the unique cultural elements that make anime so special could be lost.

• OBJECTIFICATION OF WOMEN, CULTURAL APPROPRIATION AND CONDONING RACIAL STEREOTYPES 

One of the most common criticisms of anime is that it objectifies women. Female characters are often portrayed as sexual objects, with exaggerated body proportions and revealing clothing. This has led to accusations that anime promotes a sexist and misogynistic culture.

Another common criticism of anime is that it is excessively violent and gory. Some people argue that this promotes a culture of violence and desensitises viewers to real-world violence.

Anime has become popular around the world, but some people argue that non-Japanese fans are guilty of cultural appropriation. They argue that non-Japanese fans are appropriating Japanese culture and using it for their own purposes without fully understanding its significance.

Anime has also been criticised for perpetuating racial stereotypes. 

The solution- Anime needs to have proper trigger warning, substantial age restrictions and diversity of not only the type of stories they are telling but also whose. 

Do you think that many future economies would be driven by the entertainment industry?