[The K-Culture Built by Companies]③ Cultural and Artistic Competitiveness Leads to National Economic Power

BTS's "Dynamite" Tops Billboard Chart
Economic Ripple Effect Reaches 1.7 Trillion Won
Global Cultural Content Drives Interest in Korean Products
K-Content Market Targeted at 300 Trillion Won, Exports at 50 Trillion Won

On September 1, 2020, BTS's "Dynamite" became the first K-pop song in history to top the US Billboard Hot 100 chart. Just a week later, on September 7, the Ministry of Culture, Sports and Tourism announced an analysis estimating the song's economic ripple effect at approximately 1.7 trillion won. Specifically, the induced production effect was estimated at 1.2324 trillion won, while the induced added value effect was calculated at 480.1 billion won. The employment inducement effect was also analyzed to reach 7,928 people.

This is a representative example demonstrating the enormous economic impact of cultural products, and it clearly illustrates why both the government and businesses should pay attention to the cultural industry. The Ministry of Culture, Sports and Tourism noted that although the direct sales generated by "Dynamite" amounted to only 245.7 billion won, the increase in exports of related consumer goods such as cosmetics, food, and apparel induced by the song was expected to reach 371.7 billion won.

BTS Las Vegas Concert Scene

Ko Jungmin, a professor at the Graduate School of Arts and Cultural Management at Hongik University, stated, "The cultural industry has a much greater ripple effect than other industries," adding, "When interest in Korean products rises overseas, it is often largely due to the influence of cultural content."

In fact, it is common for the sales of products used by male and female protagonists in Korean dramas to increase when those dramas gain popularity overseas. Cultural content enhances trust in products and drives a powerful promotional effect.

According to a report by the International Trade & Commerce Research Institute of the Korea International Trade Association, overseas buyers also responded that their favorable perception of Korean culture leads to purchases of Korean products. In a survey conducted in March 2022, after K-content such as "Parasite" and "Squid Game" gained worldwide popularity, 66.7% of overseas buyers responded that Korea's national brand had become stronger than in the past. The most frequently cited reason was the "spread of K-content" (31.8%), followed by the "development of Korean companies" (25.6%).

Additionally, 82.2% of respondents said that the strengthening of the national brand increased their interest in Korean products, and 75.1% said it actually influenced their purchasing decisions.

Cultural and artistic competitiveness is directly linked to national economic power. A positive national image forms intangible trust in the process of consumers choosing goods or services, playing a crucial role in expanding exports.

This is why the Lee Jaemyung administration has put forward "cultural powerhouse" as one of its five major national visions. The government has set a goal to expand the K-content industry market size to 300 trillion won and exports to 50 trillion won by 2030, aiming to build a "nation strong in software."

As of 2023, the domestic content industry recorded sales of 154.1785 trillion won and exports of $13.3394 billion (approximately 18.3977 trillion won). To achieve the government's targets, sales must double and exports must nearly triple.

Professor Ko emphasized, "We need to support venture companies and new content creators by building infrastructure such as funding through dedicated funds," and added, "With film and drama production currently shrinking, government funding can serve as a catalyst." He also analyzed that, particularly in creative fields, Korea can have a comparative advantage because China lacks competitiveness in creativity due to the limitations of its socialist system.

He continued, "Recently, fields where technology and content converge have been growing rapidly," advising, "We must prepare for the expansion of the artificial intelligence (AI) content market and simultaneously foster regional content development by establishing content clusters in local areas."