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Eurasian Geography and Economics, 2012, 53, No. 2, pp. 197215. http://dx.doi.org/10.2747/1539-7216.53.2.197
Copyright 2012 by Bellwether Publishing, Ltd. All rights reserved.
Creative Space, Cultural Industry Clusters,
and Participation of the State in Beijing
Tsu-Lung Chou
1
Abstract: A Taiwanese urban planner investigates the spatial strategy for the development of
creative cultural space (i.e., cultural industry clusters) in Beijing, utilized by the municipal
government since 2000 as part of Bejings effort to join the group of elite world cities. The
research is focused in particular on the art cluster popularly known as the 798 Art Zone, which
is used as a case study to demonstrate how the construction of cultural space (a state-sponsored
effort that emphasizes the building of infrastructure and institutions) to a large extent neglects
the development of local grassroots artistic networks. He concludes by arguing that local state
intervention was ultimately not benefcial to the construction and organic development of cre-
ative culture space in the city. Journal of Economic Literature, Classifcation Numbers: J240,
O150, O310. 2 tables, 32 references. Key words: China: organic development of creative
culture, cultural industry cluster, grassroots network, local state, Beijing.
INTRODUCTION
A
s part of the effort to vault Beijing into the ranks of elite world cities, the Beijing munici-
pal government has been actively engaged in the construction of cultural space since
2000. Its strategy literally entails construction, as it involves the state-sponsored building
of infrastructure, industrialization of culture, and the fashioning of a market system (Kong
et al., 2006). The offcial state discourse on the development of cultural space emphasizes
the promotion of cultural industry conglomeration through the strategic intervention of the
state. Another aspect of this discourse is that the central objective of the development of the
cultural industry is to stimulate the development of creative culture. As a result, unlike other
Chinese cities that attach importance to the development of the cultural industry, Beijing has
prioritized the development of the creative culture industry (Kong et al., 2006; Keane 2009).
2

This paper investigates the Beijing municipal governments strategy for the development of
creative culture and examines critically whether it can be successful in spurring the organic
development of creative culture. By organic development, I refer to a self-reinforcing
mechanism that can advance the development of creative culture through interactions among
members of the citys artistic community within their own closely knit networks. The suc-
cessful conglomeration of culture industry actors therefore hinges on whether the institutional
cultural network is organically embedded.
1
Professor, Graduate Institute of Urban Planning, National Taipei University, 151, University Rd., San Shia
District, New Taipei City, 23741 Taiwan (Choutl@mail.ntpu.edu.tw).
2
The major difference between the cultural industry in other Chinese cities and the creative culture industry
in Beijing lies in the importance of creativity as a driving force for urban development and connected economic
growth and prosperity. The focus of Beijings strategy and policy has been on what the city should do in order to
be (or to become) creative, whereas in other Chinese cities, the policy emphasis is on the contribution of cultural
industrialization to economic prosperity.
198 EURASIAN GEOGRAPHY AND ECONOMICS
Using organic cultural development as a yardstick, this paper critically examines the
municipal governments strategy and its effcacy to date. The cultural industrialization of
Beijing began only in 2000 and hence still has a relatively brief history. Although materials
on the various state policies are quite abundant, it is nonetheless diffcult to draw conclusions
about their effectiveness. It is particularly diffcult to determine the extent of the organic
development of creative culture. In an effort to shed further light on the latter issue, the 798 Art
Zone is presented as a case study to more closely analyze the purpose of the Beijing municipal
governments strategic intervention, as well as its impact on creative cultures organic devel-
opment. As a good example of the initial success of Beijings creative culture industry, 798s
story has been widely covered by both the domestic and international media (e.g., see Currier,
2008; Kong et al., 2006; Keane, 2009), and warrants further in-depth analysis. Major sources
of information used in this study include relevant media reports (newspapers, magazines, and
the Internet) and feld work conducted in October 2007 and June 2009. During the period of
feld work, the author and colleagues visited all of 798s studios and galleries, and conducted
roughly 10 interviews with the artists there. In addition, we also interviewed 5 scholars of
creative culture studies from three universities in Beijing and held two group discussions.
This paper argues that the construction of cultural space in Beijing is a state-sponsored
effort that emphasizes the construction of infrastructure and an institutional framework for
the world-city building, but to a great extent neglects the organic construction of the artis-
tic network. My analysis of the 798 case reveals that the state is attempting to establish a
government-sponsored industry development route rather than promoting the growth of the
local grassroots artistic network. The two following sections set the stage for the 798 case
study by examining the discourse and practice of creative culture development in Beijing.
The third section focuses on the 798 case, and assesses prospects for the organic development
of creative culture space in Beijing in the future. A concluding section restates the papers
basic fndings.
CULTURAL INDUSTRIALIZATION IN BEIJING
Central Government Discourse on Cultural Industrialization
Cultural industrialization was frst listed as an offcial policy objective in the Chinese
Communist Partys 10th Five-Year Plan in 2000 (Hui, 2006; Keane, 2009). The Plan
proposed to promote the development of the cultural industry by deepening reform of the
cultural system, improving cultural and economic policy, strengthening management and
construction of the cultural market, [and] combining information and the cultural industry.
By associating culture with economic development, these measures have changed the mode
of cultural development in China. All involved the restructuring of state institutions toward a
market system, including the establishment of a cultural market and a mechanism for cultural
industrialization.
Built to meet the needs of a planned economy, Chinas traditional cultural system adopted
a planned management mode that emphasized cultures role in moral and ethical education,
as well its function in the states ideological control. But it neglected (and even excluded)
cultures commercial function as a consumer product and the positive role that the cultural
industry can play in economic development. The operational mode of this traditional cultural
system (or cultural enterprise system) was of a fnancially guaranteed (or social charity)
typenamely, the state sponsors culture (China Cultural Industry, 2002; also see Kong et
al., 2006, p. 190). One of the main objectives in shifting government functions is to transform
TSU-LUNG CHOU 199
the traditional management mode of sponsoring culture under a planned economy to a mod-
ern management mode of managing culture under a market economy. This is to be achieved
mainly by overseeing the cultural industry, controlling the market by economic, legal, as well
as administrative means, and providing business guidance for cultural enterprises (e.g., see
Outline of the Development of the Cultural Industry, in the 10th Five-Year Plan). In other
words, a market system is to be established to distribute the resources of the cultural industry
and improve the quality of the cultural product and relevant services.
Beijings Discourse on Creative Culture Development
In developing its cultural industry, the Beijing municipal government has placed a pre-
mium on creative culture (defned below). The basis for Beijings creative culture industry,
most researchers argue, are the advantages conferred upon the city as the national capital: deep
cultural roots that serve as the source of creative inspiration, a large pool of talent workers, a
powerful scientifc innovation capacity that provides solid technological support, robust con-
sumption demand, and a large market
3
(see also Samuels et al., 1989; Keane, 2009, 8285).
At the 31st Meeting with Experts of Science and Technology (a communication platform for
Beijings leaders and the citys social and natural scientists), both Beijings mayor and Party
secretary stressed that developing creative culture was a key measure in implementing the
concept for the citys scientifc development, adjusting its economic structure, and chang-
ing its mode of growth (Creative Culture, 2006). They observed that Beijing should use the
creative culture industry as a new channel for economic growth, and promote its development
by constructing a scientifc innovation platform for the creative culture industry.
This notwithstanding, the actual formulation of Beijings creative culture policy was the
result not so much of bureaucratic calculus and planning but to a great extent the academic
discourse of world city competition (Scott, 1999; Hall, 2000; Hui, 2006; Kong et al., 2006;
Mok, 2006; Keane, 2007), particularly following the citys successful bid to host the 2008
Olympic Games. Inasmuch as market-oriented cultural industrialization represented a new
attempt by the Chinese government to reform the cultural system, local authorities sought
to acquire the relevant knowledge from academic sources, especially from the theories
and policies of world city development. The major channel through which such informa-
tion fowed was a network forged between academia and the municipal government, which
included seminars presented by experts and consultants, as well as the International Forum on
the Cultural Industry in China, inaugurated in 2003. Beijing was the site of numerous inter-
national meetings on creative culture, such as the 2006 International Forum on the Develop-
ment of Culture Industry, which invited experts from Europe and North America to present
the results of their research on world city building. These meetings in turn had considerable
infuence on creative culture studies policymaking in Beijing.
WORLD CITY BUILDING AND CREATIVE CLUSTER DEVELOPMENT
Because creative culture is a knowledge-intensive industry, innovation in this industry
resembles that of Chinas science and technology sector. Recently, both sectors have played
a key role in Chinas economy. Under the circumstances, it is not surprising that the emerg-
ing creative culture industry would borrow its development model from the relatively mature
science and technology sector (Porter, 1990; Walcott and Xiao, 2000; Gu, 1996; Chou et
3
Authors interview with Beijing talent worker, October 10, 2007.
200 EURASIAN GEOGRAPHY AND ECONOMICS
al., 2007; Keane, 2009). As a result, the development strategy of Beijings creative culture
industry is clearly a top-down model patterned after that of the science and technology indus-
try. The government defnes specifcally what the cultural industry is, which then forms the
basis for the states strategic intervention. The state can direct its strategic resources through
cultural industry bases, in order to stimulate the formation of creative industry clusters and
a vertical production chain. Other development policies, also modeled on the science and
technology sector, can be found in A Number of Policies on Promoting the Development of the
Creative Culture Industry in Beijing (2006), which include: lowering the threshold for market
entrance and broadening the scope of the market; encouraging investment of nongovernment
and foreign capital in creative culture industry; establishing special sources of funding; and
expediting the residency status of creative culture workers. These measures are discussed in
greater detail below.
Defnition of the Creative Culture Industry
In the Classifcation Criteria of the Creative Culture Industry (2006), the creative culture
industry was defned as an interconnected industry cluster that employs creation, invention,
and innovation as the fundamental means to provide the public cultural experiences, with
producing cultural content and creative product as its core value, and the consumption or
realization of intellectual property as its trading features. The creative culture industry was
divided into nine categories spanning the entire industrial chain from creation, to production,
to consumption: (1) arts and culture; (2) news and publishing; (3) broadcasting, television,
and flm; (4) software, Internet, and computer services; (5) advertising and exhibitions; (6)
art trading; (7) design services; (8) tourism, leisure, and entertainment; and (9) other auxiliary
services. In 2005, the creative culture industry in Beijing produced a total of 70.04 billion
RMB of added value, accounting for 10.2 percent of the citys GDP. The creative culture
industry was thus believed to have attained considerable scale and established itself as main-
stay of the municipal economy (Beijing Business Times, December 14, 2006).
Cultural Strategies Modeled on Science and Technology
A number of municipal government strategies have been employed to promote the estab-
lishment of creative culture bases:
Investment Promotion. The government drafted a Cultural Products Investment Index
that specifed projects that are encouraged, restricted, or forbidden by the state. It also acceler-
ated its efforts to create a uniform market admission policy, which eliminated certain restric-
tions on private-sector investment in the cultural industry, and encouraged social capital of
all kinds to invest in the cultural industry or cultural products. To encourage and guide capi-
tal investment in Beijings creative culture industry, the government issued the Investment
Guide for Beijings Creative Culture Industry, which listed the following categories as key
sectors for investment: performing arts; publishing and intellectual property trading; televi-
sion programming and flm making and trading; animation and Internet games research and
development; advertising and exhibitions; antiques and art trade; design and invention; and
cultural tourism. The guide also divided the creative culture industry into four categories for
investment: encouraged, permitted, restricted, and forbidden.
4
4
For sectors not included in the creative culture industry guide, a rule of not forbidden means permission is to
be appliedi.e., if a certain sector is not listed as forbidden, then it is open to private investment.
TSU-LUNG CHOU 201
Special Funding. Each year, 500 million RMB is to be set aside for the Special Fund
for the Development of the Creative Culture Industry for expenditures supporting creative
culture products, services, and special projects. The funds are to be made available in vari-
ous forms such as loan interest and special project subsidies, government purchases, and
redemptions and awards. In addition, a Special Fund for the Construction of Infrastruc-
ture of Creative Culture Clusters was established. Over the span of three years, this Fund
will allocate 500 million RMB for the construction of infrastructure, public facilities, and
improvement of the environment of creative culture clusters.
Development of a Base of Talent Workers. The 2006 Talent Development Index for
the Four Major Economic Industries in Beijing, issued by the Beijing municipal government,
for the frst time included the creative culture industry. According to this Index, with the rec-
ommendation of employers, creative culture professionals whose Employment-Residence
Cards are more than three years old can apply for a Beijing Resident Identity Card.
5
Construction of Creative Culture Bases
Construction of infrastructure was the frst step undertaken by the Beijing municipal
government to promote the development of creative culture. This effort consists of three
types of programs. The frst involves the construction of massive government-sponsored
cultural facilities such as the National Grand Theater and the Beijing Theater for Performing
Arts. The second features the revitalization of formerly state-owned cultural enterprises.
6

A third program encourages competition among different district governments, with each
district utilizing its comparative advantages to plan and develop its own specifc types of
creative clusters. The Beijing municipal government then selects a few of these clusters as
Beijings creative culture bases (or clusters), a process already under way, but has yet to be
completed.
In 2006, under the 11th Five-Year Plan, the Beijing municipal government announced
the selection of the frst group of creative culture clusters and some key projects that were
to be supported by the Special Fund for the Development of the Creative Culture Indus-
try for the 2006 fscal year.
7
Subsequently, an additional eight creative culture clusters were
planned and developed.
8
These creative culture bases can be divided into three categories
5
I.e., for Beijing hukou status. For the complex hukou regulations and statuses in Chinese cities, see Chan
(2012).
6
For example, Beijings Gehua Cultural Enterprise spent 1.6 billion RMB in building the Beijing Creation Center
in the citys Dongcheng District, which upon completion will become the largest comprehensive animation and Inter-
net game research and development center in the city (Peoples Daily, overseas edition, May 26, 2006).
7
These included the Zhongguancun Creation Industry Pioneering Base; Beijing Digital Entertainment Indus-
try Model Base; National New Media Industrial Base; Zhongguancun Science and Technology Industrial Zone
(Yongheyuan); China (Huairou) Television and Film Base; Beijing 798 Art Zone; Beijing DRC Industrial Design and
Creation Industrial Base; Beijing Panjiayuan Antique and Art Trading Park; Songzhuang Original Art and Cartoon
Industry Cluster; and the Zhongguancun Software Industrial Park.
8
The newly designated eight creative culture clusters include: Dongcheng Cultural Zone; National New Media
Industrial Base; China Film and Television Production Base; Sanchen Cartoon, Animation, and Internet Games
Industrial Base; Beijing Joy Valley Theme Park; New National Exhibition Center; Deshengyuan Industrial Design
and Creation Base; and Chaoyang Park Cultural Zone (Guangming Daily, December 10, 2006). Among these, the
output value of the Dongcheng Cultural Zone (Zhongguanchun Science and Technology Park, Yonghe) was expected
to reach 2030 billion RMB in 2010. Around 1 bilion RMB was to be invested in the Sanchen Cartoon, Animation,
and Internet Games Industrial Base over a period of three years, with its yearly output value expected to reach 3
billion RMB. With 120, 000 employees, Sanchen will become Chinas (and perhaps the worlds) largest animation
and Internet game research and development center (ibid).
202 EURASIAN GEOGRAPHY AND ECONOMICS
(for some examples, see Table 1). The frst type encompasses clusters of the software, games,
and animation industries, which mainly employ modern Internet technology to develop digi-
tal entertainment products. Examples of this category include Beijing Digital Entertainment
Model Base, which is located in Shijingshan District, and Haidian Districts Zhongguancun
Creative Industry Pioneering Base. The second category consists of clusters that were built
with the redundant resources of certain traditional industrial bases, such as the Beijing DRC
Industrial Design and Creation Base, and the Dashanzi Art Zone in Chaoyang District. The
third category involves clusters formed by large creative culture enterprises and smaller enter-
prises clustered around them. The China (Huairou) Television and Film Base is an example
of this category.
Table 1. Information about Selected Creative Culture Clusters in Beijing
Name Location Features
Beijing Digital
Entertainment
Model Base
DRC (Design
Resource
Cooperation),
Shijingshan
One of four digital entertainment industrial bases approved by
the Ministry of Science and Technology. Has already attracted
dozens of digital entertainment enterprises. Partnered with
Peking Universitys Creative Culture Institute, but investor has
withdrawn investment.
Zhongguancun
Creative
Culture
Pioneering
Base
Centered around
Haidian Books
City area
Cluster members include: Peking University Science and
Technology Park, Tsinghua University Science and Technology
Park, Peoples University Cultural Industry Park (Olympic cul-
ture), North Taipingzhuang Animation Designing Center, and
Creative Design Belt of Architecture in Ganjiakou (affliated
with the Ministry of Construction)
Deshengyuan
Industrial
Design and
Creation Base
Desheng
Science and
Technology
Park, Xicheng
Core function: technical platform and incubator of professional
design agency. Includes design techniques, materials exhibi-
tion, communication and training, institutional training, basic
research. Several buildings to rent.
Chaoyang
Dashanzi
(798) Art
Zone
Dashanzi area
in Chaoyang
District
Developed on the basis of some vacant factory buildings of the
Seven Star Science and Technology Group. Has become one of
the icons of Chinese arts and fashion.
National
New Media
Industrial
Base
Weishanzhuang
of Daxing
District, west
of the Yizhuang
Development
Zone
A total of 10 billion RMB is to be invested during the 11th
Five- Year Plan period. Plans to attract world-renowned
companies like the British National Animation Center and
Disney to set up business.
Dongcheng
Cultural Zone
Area around
Xiaojieqiao
in Dongcheng
District
Digital businesses are accorded priority, to create branded
animation and Internet game products. With Gehua Creation
Industrial Center (mass media, television programming) as
a platform, plan is to build Beijing Animation and Internet
Games Research and Development Center and Intellectual
Property Rights Trading and Import and Export Center. Also
publishing and flm-making.
Sources: Compiled by author from Peoples Daily, May 26, 2006 and Guanming Daily, December
10, 2006 as well as sources previously cited in the text.
TSU-LUNG CHOU 203
STATE CONSTRUCTION OF CULTURAL SPACE:
THE CASE OF THE 798 ART ZONE IN BEIJING
As demonstrated above, the development of the state-sponsored cultural industry and the
construction of cultural space refect the Beijing municipal governments attempt to stimulate
the development of creative culture and thus promote Beijings quest to become a world city.
This is done by promoting the development of cultural industry clusters, which are sites of
infrastructure construction and investment. The remainder of the paper addresses the question
of whether such a model for stimulating creative culture can actually become the major driv-
ing force for the citys future development.
Interestingly, whereas the Chinese government is using a top-down strategy to promote
the development of the cultural industry in Beijing, there is evidence that many cultural indus-
try clusters in the city appear to have developed according to an inverse, bottom-up model.
In addition to the famous 798 Art Zone, there is also a village built by artists in Songzhuang
the Left-Right Art Zone neighboring 798, which includes an exhibition area (Zhengdong
Creation Park) erected on the site of a dilapidated tractor factory. With a huge twin tower as
a landmark, the Zhengdong Park has attracted many creative businesses, such as flm and
television, arts, performing arts, and fashion design.
The spontaneous emergence of such cultural spaces can be referred to as the organic
development and clustering of the cultural industry. The driving force behind this spontane-
ous development results from the formation of a grassroots cultural network. For the sponta-
neous construction of cultural space, the building of an artistic network and the accumulation
of soft capital are more important than the construction of infrastructure and the accumulation
of commercial capital emphasized by the state-sponsored (top-down) model, which antici-
pates rapid economic results.
How has the spontaneous construction of cultural space led to organic cultural industry
clustering and development? In China, this spontaneous model has already been selectively
incorporated into the state-sponsored construction of cultural space. More specifcally, the
798 Art Zone, generally regarded as the prototypical case of spontaneous construction of
cultural space in Beijing, was named one of the citys creative culture clusters by the Beijing
municipal government in 2006 (see note 6). What impact has this designation had on the
organic development of creative culture? Has the organic development of cultural space
continued in 798 following its integration into the states cultural system? I address these
questions below.
Background
The 798 Art Zone, also known as the Dashanzi Art District, is located in the northeast
corner of Beijing. The land on which the 798 Art Zone is situated previously was a factory
area under the jurisdiction of the former Ministry of Electronic Industry. From the late 1950s
to 1964, this area was the site of the Ministrys 706, 707, 718, 751, 797, and 798 factories.
Together, these factories were known as the 718 Joint Factory, or State-owned Beijing North
China Wireless Electronics Joint Factory. At the time, they served as the Chinese govern-
ments atomic bomb component manufacturing base. The factory buildings, constructed with
assistance from thenEast Germany in the 1950s, were mostly of the German Bauhaus style
(Keane, 2009, p. 89; see also Li, 2008; Luo, 2008). The Seven Star Group took over the opera-
tion of these factories in 2001. By that time they had been in decline for two decades, and pro-
duction had gradually shifted to a semi-operational status. As a result, the number of factory
204 EURASIAN GEOGRAPHY AND ECONOMICS
workers had declined from more than 20,000 to less than 4,000, and many factory buildings
fell into disuse (Currier, 2008, p. 242). With the rise of high-tech industry in Beijing, the area
was incorporated into the Zhongguancun Science and Technology Industrial Zone in 1999.
According to the offcial plan, the area was to be transformed into a science and technology
park named Zhongguancun Electronics City after relocation was completed by 2005.
However, beginning in 2000, 798s unique architecture style and low rent attracted artis-
tic communities at home and abroad to set up studios there. In particular, artists from the
Beijing and surrounding areas began to cluster in 798 after 2001. Taking full advantage of the
factory buildings old style, after some renovation and adornment, these artists transformed
the old factory structures into unique spaces of creation and exhibition. According to a survey
by Wang (2006), by 2005 a total of 103 artistic bodies and businesses had made the 798 Art
Zone home, 59 of which were engaged in artistic creation, exhibition, and communication
and 29 in design, including advertising design, furniture and interior design, and fashion and
image design. In addition, service businesses such as bookstores, media and publication out-
lets, and restaurants and bars sprang up. At least 300 artists chose 798 as their major creation
space, some of whom are from France, the United States, Belgium, Netherlands, Australia,
South Korea, Singapore, and Taiwan (Wang, 2006).
Through the promotion of a series of large cultural festivals held from 2003 to 2005, the
798 Art Zone came to be widely known by the public. More important, with Beijing being
selected as one of the 12 world cultural cities by Americas Time magazine in 2003, 798 has
become a world-renowned art zone. Ironically, with its reputation spreading, the government
and the Seven Star Groups attitudes toward the 798 Art Zone began to shift as well.
Assets: Location, Artistic Community, and Clusters of Diverse Cultural Institutions
A precondition for the organic development of creative culture space is the existence of
territorial assets, which include a favorable location, prominent artists and their community,
and clusters of diverse cultural institutions. Each is discussed in some detail below.
Location. According to the bottom-up art zone development model, the basic condi-
tions of location, such as proximity to the city, rent, and architectural style, are quite important
at the beginning stage. As sculptor Li Xiangqun observed, The factory buildings are very
spacious, and they are not far from the city, plus the rent is not high, so it is a very suitable
place for sculptors (Zhou, 2006). In addition, 798s location is also near the embassy area
and upscale neighborhoods, making it a great place to hold exhibitions and promote the arts.
As a result, art galleries and cultural foundations also have followed in the footsteps of the
artists. This has not only increased the diversity of the tenants, but also gradually transformed
the 798 Art Zone from a creation-oriented art zone into a platform for art trading and exhi-
bition. In 2006, 798 was designated by the Beijing municipal government as an Arts and
Cultural Creation Industrial Park, one of the frst 10 parks of its kind (Peoples Daily, over-
seas version, April 9, 2007).
Prominent Artists and Cultural Communities. For the art zone, location is merely a
static asset. What really makes it function as a creative culture zone is the clustering of artists.
In the case of the 798 Art Zone, it all began in 1996 when students and faculty members from
the Department of Sculpture of the China Central Academy of Fine Arts rented a warehouse of
the factory as a temporary studio. Most importantly, a group of prominent artists, very active
in their felds, then followed suit. Some had graduated from the nations top arts schools,
some were returnees who had studied the arts abroad for many years, and still others were
well-known foreign artists from Europe and Asia. In other words, the 798 artistic community
TSU-LUNG CHOU 205
is not merely comprised of the drifting in Beijing crowd (beipiao yizu), who are not offcial
Beijing residents and who live on the fringes of the city, both physically and psychologically.
It also houses a group of famous contemporary artists, such as Professor Li Xiangqun of the
School of Arts of Tsinghua University, sculptor of the Deng Xiaoping statue in Guangan and
the statue of Bajin in the Gallery of Modern Literature; Huang Rui, who lived and worked as
an artist in Japan for over a decade before returning to Beijing where he helped to found the
Beijing Tokyo Arts Projects,
9
initiated art events in 798, and became the spokesman of the 798
artistic community (see Huang, 2008); photographer Xu Yong, who set up his studio in 2002;
and Robert Bernell, an American art critic and promoter of contemporary Chinese art. In fact,
the opening of Bernells Timezone 8 Art Books bookshop in 2002 is often regarded as the
beginning of the formation of the 798 Art Zone.
10
Clustering of Diverse Cultural Institutions. After the artists began to become comfort-
able in their new accommodations, some studios organized a series of exhibitions in an effort
to attract visitors and like-minded artists. In October 2002, the Tokyo Arts Projects launched
the frst artistic exhibition Beijing Afoat, drawing in large crowds of visitors. In April 2003,
photographer Xu Yong opened up the 798 Space Gallery, the largest exhibition space and
also the most notable example of the re-branding of the factory space. This gallery was also
featured in Time magazines article on the styles of world capitals in 2003. Through promo-
tions held by some studios, especially a series of large-scale exhibitions in 2003, such as
Reconstruction 798, Blue Sky Exposure, and the Exhibition of Contemporary Chinese
and German Arts, the 798 Art Zone, originally just a haven for artists, began to come into
public view.
These individual and collective exhibitions exerted a powerful infuence on many artistic
enterprises. With the addition of experimental music and the Yan Club, which brought in
famous musicians and bands to Beijing, 798 was transformed into a creation and exhibition
base for experimental music. Within less than a year, the number of art or fashion businesses
such as art galleries, bars, boutiques, and magazine stores jumped to about 40, while art stu-
dios proliferated as well, numbering more than 30. This broader cultural renaissance made the
798 Art Zone stand out from other art clusters that typically were composed exclusively of
art galleries. Consequently, in addition to painting, sculpture, environmental design, photog-
raphy, luxury interior design, and fashion design, the 798 Art Zone also houses other related
service businesses like art galleries, exhibition space, cafs, bars, and restaurants. By 2003,
798 had become not only a production space for creative culture, but also a window on con-
temporary Chinese art and a communication platform for both domestic and foreign artists.
Organic Growth: Conficts over Space vs. Grassroots Embeddedness
Drawn to 798 by introductions from those already working in the Zone, 798s artists are
pioneers brought together by a common interest in the contemporary arts. Facing the same
uncertain future, they had to work hard together in the work of establishing studios and con-
fronting other challenges. The experience of successfully overcoming crises together fostered
the development of a socially embedded cultural network of trust and cooperation among
network members in 798, which in turn supported community identifcation and an organic
9
Huang Rui returned from Japan in early 2002 and rented his own personal studio in 798. Later, with encourage-
ment, the Tokyo Arts Gallery from Japan established a gallery (Tokyo Arts Projects) next to his studio.
10
This bookstore also served as the offce of Bernells English-language website of contemporary Chinese art,
which became an active promotional channel for contemporary Chinese art and also inspired some artists to establish
studios in 798.
206 EURASIAN GEOGRAPHY AND ECONOMICS
inner growth mechanism. 798s artists could only survive by combining their resources and
speaking with a uniform voice. This made 798s artistic network quite open and tolerant. Con-
sequently, during the artistic networks phase of expansion and development, the networks
solidarity and identifcation did not decrease, but rather strengthened.
Nonetheless, the organic growth of cultural space does not come naturally, and is not a
natural result of clustering. Rather it occurs as a result of multi-level mobilization by cultural
activists and the grassroots community, which overcome obstacles and strengthen members
commitment to cooperation and solidarity. This multi-level mobilization typically is launched
by local network activists, who then attract outside activists to join their network, thereby
expanding the network and enriching their resources, including tangible political and eco-
nomic resources. The immediate local network may not possess suffcient resources to sustain
or expand the network, and multi-level grassroots mobilization therefore becomes necessary
as a strategy to absorb and mobilize additional levels of activists and resources. Without such
mobilization it is diffcult to foster organic growth and promote the construction and develop-
ment of cultural space. Below I review the specifc challenges and crises that 798 faced on its
path of development, followed by an analysis of the multi-level mobilization by its artists, as
well as the impact this had on the organic expansion of 798s cultural network.
External Challenges and Crises. 798s artists faced two salient challenges (e.g., see
Currier, 2008, pp. 242245). First, contemporary art was still located on the fringes of the
Chinese cultural spectrum. To transform it into mainstream culture, cultural promotion was
needed. The second challenge was how to contest the looming dismantling and reconstruc-
tion of the 798 building stock, scheduled for 2005. In fact, from the outset, Seven Star Group
representatives made it clear to the tenants that the factory area had been designated as part of
the projected Zhongguancun Electricity City and needed to be dismantled by the end of 2005;
in fact, a deal was already in place with a Hong Kong real estate developer to redevelop the
798 property. For Seven Star Group, its main task was to follow the states instructions and
take care of its laid-off workers by properly developing the land. The Seven Star Group was
therefore concerned that once the art zone took off, it would have negative consequences for
the original land redevelopment plan. For this reason, the Group did not relish the prospect of
a strong artistic network taking root and thriving in 798.
Cultural Space and Grassroots Mobilization. Confronted with the imminent re-devel-
opment of 798 by the Seven Star Group, the artists of 798 adopted a strategy of holding
joint large-scale cultural festivals and exhibitions. Through these cultural promotions, they
established an image of 798 as a cultural space and brought local artists and their works to the
national and even world stage. They also attracted artists and institutions from abroad, over-
coming previous spatial limitations. More important, the collectively held cultural festivals
and exhibitions helped 798 tenants to popularize contemporary art and raised its national and
international profle.
These activities ran counter to Seven Star Groups vision for 798, and conficts arose
between the two parties. Reconstruction 798, a large-scale exhibition staged by a group
of artists led by Huang Rui in 2003, frst began to draw public attention to 798. The slogan
Reconstruction 798, in essence, refects an effort by the artists to re-defne the mission of
798, i.e., to turn it into a base for artistic creation. However, Seven Star Group declared the art-
ists to be mere tenants, with no rights to reconstruct the zone. Nevertheless, Reconstruction
798 ushered in the transformation of 798, a process accelerated by the following Dashanzi
Art Festivals. As a result, the 798 Art Zone began to take shape and discussions involving this
originally local topic spread across the entire nation. 798 had become fashionable.
TSU-LUNG CHOU 207
With the 2003 event being well received, the artistic community decided to turn it into
an annual event. In April 2004, the art zone announced that it would hold a one-month-long
Dashanzi Art Festival. Shortly after this announcement, the Seven Star Group declared its
opposition to the festival on the grounds that the holding of an art festival must be approved
by relevant government agencies. In response, the art zone swiftly changed the events name
from the First Dashanzi International Art Festival to the 2004 Dashanzi Art Zone Art
Exhibition. Seven Star Group then posted placards on the 798 grounds announcing that
The Group has the right to seal off the art zone if an art festival is to be held. The artists
responded with their own placards, which read Our art exhibition is Dashanzi art activity
month. Ultimately, Seven Star Group had ditches dug in the art zone and taxis were banned
from entering the zone, complicating visitor access (and lengthening walking distance) to the
zone and making the entire 2004 event somewhat chaotic.
Furthermore, the relationship among artists during the frst Beijing Dashanzi Inter-
national Art Festival in 2004 was not as harmonious and united as it had been in Recon-
struction 798. The main reason was that while raising funds from the outside, Huang Rui
also charged the artists a fee, raising suspicions about the events fnancial situation. Learn-
ing from this experience, Huang Rui and his friends set up an exhibition company named
Thinking Hand to deal with the problems of manpower and funding at future exhibitions.
As a result, the following second and third art festivals were managed in a more professional
manner and drew an increasing number of visitors. More importantly, the festivals also served
to recruit additional tenants for 798. With the scale of 798s art network expanding rapidly,
mutual trust and cooperation among the networks members also grew. The artists were quite
satisfed with the second and third art festivals and were grateful to Huang Rui for his efforts.
The networks social embeddedness and institutional thickness were therefore reinforced.
Multi-level Mobilization. Although grassroots mobilization was launched by network
members, the mobilization was not confned to the local network. It also occurred at the
national political level as well as in the international media.
National political mobilization. During 2004s Two Meetings,
11
a Deputy to the
National Peoples Congress, Li Xiangqun, presented the Beijing Peoples Congress with a
bill entitled Preserve An Architectural Heritage of the Old Industry, Preserve A Thriving Art
Zone, calling for the suspension of the planned dismantlement of 798. The bill was carefully
studied by the Beijing municipal government. In March 2004, the Ministry of Construction
issued Guidelines on Strengthening the Preservation of Valuable Modern Architecture in the
Urban Area, pointing out that 798s old factory buildings are typical modern Bauhaus-styled
buildings constructed in the 1950s, whose unique style is rare in Asia. As such, the guidelines
suggested, the buildings should be protected as an important part of the citys historical and
cultural heritage.
International discourse. Through the internet, Robert Bernell sent out a stream of reports
on 798 and the development of Chinese contemporary art, which soon garnered international
media attention. Hence the report by Time magazine in 2003, which listed Beijing as one of
the 12 contemporary artistic cities of the world. Following this report, a series of international
events held in 798 and the international medias coverage of these events further acceler-
ated the formation of the international discourse on the 798 Art Zone. Infuenced by these
reports, international foundations and art galleries began to move into the art zone. In 2006,
the Red Gate Gallery, one of the earliest foreign galleries in Beijing, opened a branch in 798.
Another prominent tenant was the Ullens Foundation (established up by the Ullens couple,
11
Of he National Peoples Congress and the Chinese Peoples Political Consultative Conference.
208 EURASIAN GEOGRAPHY AND ECONOMICS
two collectors from Belgium). 798 thus became an international window on contemporary
Chinese art.
National discourse on Beijing as world city. Thus, what was originally a local cultural
subject suddenly became a national and even international topic of discussion. The devel-
opment of the 798 Art Zone therefore became framed as an issue central to the building of
Beijing as a world city. Sculptor Li Xiangqun pointed out, Of course, in terms of immediate
economic return, nothing comes quicker than selling land. But in terms of a citys long-term
development, a citys real attractiveness lies in the formation of a diverse culture (798 Art
Zone, 2004). Professor Yang Dongping of Beijing University Science and Technology, an
expert on urban cultural studies weighed in as well, noting A citys soul and glamour are
determined by the citys humanistic atmosphere and cultural ecology. A city without culture
is only a forest of concrete. So from this point of view, the contribution that 798 makes to
Beijing is far bigger than a landmark building (798 Art Zone in Beijing, 2004). Clearly, the
shaping and development of the 798 Art Zone had assumed great strategic importance to
Beijings effort to brand itself as a cultural capital and a world city.
As a result, through the mobilization of the artistic community, a local cultural sub-
ject spread to the national political arena, and then to the international media, which in turn
affected the nationwide discourse involving Beijings claims to world city status. Under the
pressure of this multi-level discourse, 798 was eventually claimed by the state as part of its
strategy to build Beijing into a world city. In addition, following the multi-level mobilization
centering on 798, Beijings leadership came to view contemporary culture as a component
worthy of inclusion in the narrative of Chinas global rise (Currier, 2008). The 798 Arts Zone
was hence re-constituted as an integrated part of Beijings world city strategy and designated
as a creative culture cluster in 2006.
Organic Clustering and the Development of Creative Culture
At the local level, this multi-level mobilization reinforced the artist networks grassroots
embeddedness and community spirit. And at the national and international levels, this process
established 798s irreplaceable status as the symbol of contemporary Chinese art. The inter-
action of these two dimensions further reinforced clustering in the 798 Art Zone. Grassroots
mobilization and networking greatly contributed to the formation of the soft capital (e.g.,
community spirit, cultural pluralism, and creative learning atmosphere) that constituted the
driving force for the development of 798. Clearly, prior to 2006, the clustering of cultural
communities in 798 was not a result of material investment or infrastructure construction,
but rather as a result of self-generated organic growth that encouraged learning and creation.
Several dimensions of 798s organic growth mechanism are discussed below.
Community Identifcation. The confict with Seven Star Group rapidly fostered a com-
munity spirit among the artists, who were operating their studios or businesses individually,
and somewhat in isolation from one another. More importantly, in this process, the outside
society also formed an identifcation with the 798 Art Zone, which in turn greatly impacted
the development of 798s artist community. Avant-garde artist Cang Xin remarked that 798
was more like a paradise. Here we are regarded as artists. Before, we were called vagrant.
seen as so-called unstable elements (798 Going, 2007). Artist Wu Xiaojun said, 798 is
like a work-unit. In the past, if what we made were brought, lets just say to the roadside, they
would be tossed away like trash. But here, at least we are recognized as artists (ibid.).
Plural, Tolerant, and Free Society. The increasingly active cultural and economic mar-
ket in 798 not only provided the artists with a great working environment, but also a platform
TSU-LUNG CHOU 209
for them to exhibit, discuss, and trade their works. A multitude of auxiliary facilities and ser-
vices provided visitors and artists with a good living and working environments, making the
community more complete and the cultural market more active. This organic process created
a healthy commercial environment for the development of creative culture.
Furthermore, the organic grassroots mobilization process also brought 798 a more
important form of soft capitala plural, tolerant and free society. As Huang Rui observed
(What Does, 2007) 798 is also like this, many elements coexist here. They are a para-
dox. Appearing in contradiction, they are in fact in harmony with each other. Together they
form an all-inclusive cultural space, displaying 798s appeal of tolerance. 798 is a vast
grassland, a space with great tolerance, an ideal home for avant-garde artists to work. For
the previously mentioned artist Cang Xin, 798 is more like a paradise. Although compared
with Dongcun, where he lived before, the rent in 798 is slightly higher, The buildings are
beautiful, and there are even security guards at the factory entrance. 798 is relatively toler-
ant (as compared with Yuanmingyun and Dongcun). Here we are recognized as artists. But
in the past, we were called vagrant. We had no identity and were seen as so-called unstable
elements (798 Going, 2007). Prior to moving to 798, he had once been detained because of
his behavioral art. Freedom, openness, pluralism, and tolerance became the symbol of the 798
Art Zones vitality.
New Driving Force for Grassroots Clustering: Creation, Learning, and Realizing
Dreams. In fact, rent in 798 has been steadily on the rise. Many small businesses surrounding
the art zone, such as coffee shops, bookstores, and galleries are not necessarily all proftable.
Some are kept afoat by profts earned from the owners other business activities. As one ten-
ant related, I didnt come here to sell paintings. Business in Wangfujing is better than here. I
came just because I like here. This is a great place for creation and a day is incomplete unless
I come here. Here you can meet with other people of the artistic community. You can even
strike up a conversation with some visitors who share the same interests in the caf. It feels
very good (798 Art Zone to Turn, 2006). Because of this soft-capital asset, Li Xiangqun
further points out that it was easier to feel the pulse of contemporary artistic trends here than
at the school (Zhou, 2007). Obviously, the impetus for artist clustering in 798 lies beyond
the monetary realm, and rather involves primarily the communitys attractiveness and related
cultural creativity (see Ye, 2008). As such, 798 had become a place to fulfll dreams for those
pursuing a career in the arts.
12
798 naturally became the frst choice, Because whether in
terms of artists, or the general atmosphere, this place is unrivaled by other places. Open a gal-
lery here and you can meet the artists and like-minded folks. Its also a good place to learn
(798 Art Zone to Turn, 2006). Clearly, artists have clustered in 798 because it provided the
key soft-capital asset for creative culture: a well-identifed creative culture community, an
open and plural society, and an environment fostering creativity and learning.
Strategic State Intervention after 2006
Major changes have occurred in 798 since its designation as a creative culture cluster by
the state in 2006. My concern is with assessing the magnitude of the change and its impact on
the core values of the creative cultural community.
In 2006, Beijings municipal government designated the creative culture industry as a key
industry and earmarked 500 million RMB to help develop several creative culture industrial
12
In addition, artists in Taiwan are in general optimistic about the prospect of the mainlands art market and some
have plans to develop their careers there.
210 EURASIAN GEOGRAPHY AND ECONOMICS
parks, including the 798 Art Zone. As a result, 798s bottom-up development model began
to confront a new wave of challenges. After being declared one of Beijings creative culture
clusters, the 798 Art Zone could not maintain its self-sustained status and develop indepen-
dently as before. A Beijing 798 Art Zone Development and Management Offce was set
up jointly by the Beijing municipal government, Chaoyang District, the Jiouxianqiao Neigh-
borhood Community, and the Seven Star Group to oversee 798s planning and management
issues. Moreover, seeing the economic success of Chinese contemporary art and art districts
worldwide, the city government decided to market 798 as Chinas SoHo (Currier, 2008, p.
248). Therefore, whether 798 was able to continue to adhere to its organic grassroots develop-
ment path is a question worthy of examination. In analyzing changes brought about by state
intervention, I frst discuss artists expectations of the states role, followed by an examination
of the discourse and realities of state intervention. The last section analyzes conficts over
space as a result of state intervention and the resulting transformation of cultural space.
Expectations of the Artists: Weak State Intervention. When asked their opinion of
the governments intervention in 798s management, photographer Xu Yong said, We are in
a dilemma. On the one hand, we do hope that this place could be better managed, but on the
other, we are also very concerned that too much management would undermine the art zones
vitality (Zhou, 2006). In his interview with Xinjingbao (798 Art Zone to Turn, 2006), Huang
Rui observed that What the government should do is to provide assistance, or establish a
development platform. The last thing we want from the government is policy guidelines,
because artistic creation and the art industry have their own characteristics. Furthermore, the
art zone is already in a pretty good shape and it draws attention from home and abroad. Maybe
you cant sell a single piece of your paintings in other places, but in 798, there will be people
to buy. So I think for now, its better to leave the art zone to its own devices. Clearly, from
the artists point of view, spontaneous growth is 798s lifeline. Weak state intervention that
helps maintain the space for art creation is the common expectation of the artists. Li Xiangqun
made this point very clearly, It should be a good thing that the government steps in. But
the crux of the issue is that the government should try to focus on service rather than man-
agement. For example, nobody is responsible for providing public facilities in the art zone.
There is even no W.C. But to build 798 into a mature creative industrial base, convenient
public facilities and public services are indispensable (Zhou, 2007). He hoped the govern-
ment could provide support in improving the art zones environment, but not to meddle in the
artistic communitys affairs.
Inevitability of Strong State Intervention. However, strong state intervention became
inevitable after 798 was designated as a creative culture cluster in Beijing. The aforemen-
tioned Beijing 798 Art Zone Development and Management Offce was established on March
28, 2007, with a broad agenda that encompasses environmental improvement, general brand
promotion, industrial upgrading, and tourism service (Peoples Daily, overseas edition, April
9, 2007).
At the top of this agenda was the improvement of the art zones physical environment,
which includes 11 measures concerning the construction of infrastructure, and especially road
improvement, parking space construction, planting of trees and grass, electric circuit upgrad-
ing, public security reinforcement, sanitation improvement, fre control facility upgrading,
and additional lighting. Next, ostensibly to create a better institutional environment, an asso-
ciation representing the zones artists was to be established. But the purpose of this associa-
tion, in reality, was to institutionalize the art zones system of creativity and strengthen the
lines of communication between artists and the government. However, the future of the 798
art zone has now become ambiguous as a result of the governments intervention. The organic
TSU-LUNG CHOU 211
growth of 798 has not continued because the Management Offce has decreed that events
and exhibitions need to be offcially reported and approved, including content and locations
(Currie, 2008, p. 247). The most infuential decision in this direction was the Offces take-
over of the 798 Art Festival for the purpose of building Beijings cultural industry, one impor-
tant part of the citys world-city building effort. The Offce declared that the 2007 Beijing
798 Art Festival would seek to continue to showcase 798 Art Zones avant-garde status, as
well the core value of this most dynamic cultural window on contemporary China. On this
basis, the Offce sought to build the 798 Art Zone into an infuential international art zone
centered on high-end art galleries, foundations, and museums for the purpose of serving as an
exhibition platform for: (a) contemporary artistic works of the highest originality and vitality,
thereby showcasing the latest developments of artistic concepts in contemporary China and
the world; and (b) contemporary urban culture in China. The thinking was that both China and
the international community needed a platform such as the 798 Art Zone, from which a mirror
image of China could be gained (Beijing 798, 2007).
13
Conficts Created by State Intervention and the Transition of the Artist Network.
The governments intervention in cultural issues has thus begun to affect 798s future devel-
opment. The frst impact was on the art zones soft capital, namely its organic development
mechanism and open and diverse creative atmosphere. In particular, the state-sponsored art-
ists association, though purportedly serving as a communication channel between the artists
and the government, is also a form of control over the artists, especially given that many of
798s art works often communicate critical positions on social problems and domestic poli-
cies, which some government leaders have found irksome. In a society still under tight politi-
cal control, this association will obviously impose restrictions on 798s freedom of artistic
expression.
A second, but more important impact has been the transition of the artistic network from
one of creation, to cultural promotion, to consumption (see Table 2). The functions of the
artistic events, which in the past served the purpose of mobilizing and expanding 798s artistic
network, have changed. Before 2006, the art festivals were not only organized by the artists,
but also fnanced by the funds raised directly by them. As pointed out previously, artists not
only expended considerable effort in constructing and promoting 798s artistic space, they
also contributed greatly to the consolidation of the artistic network and the introduction of
their works. After the Management Offce was established, with the support of government
funding, exhibition professionals were hired to take over the organization and promotion of
art festivals and other cultural events. On the surface, this may have seemed conducive to the
development of art, but in reality it was more a political and economic maneuver. Economi-
cally, through the promotion of the collective brand and cultural tourism, the Management
Offce intended to further commercialize 798 and transform it into a space of culture con-
sumption. Politically, through the governments institutional promotion, the construction of
cultural space for the purpose of building a world city was emphasized. Grassroots cultural
characteristics are therefore in danger of being replaced.
Another important change that has far-reaching implications is that, following govern-
ment intervention in 2006, the purpose of cultural mobilization as well as the agents who
execute it have changed. A new artistic network centered on world city building is beginning
to replace the old grassroots network. Major members of this new network are the government
and a new group of cultural construction and consumption bodies that include cultural service
13
In other words, both the Chinese and international communities would view the events at 798 from their own
perspectives, which would in turn be shaped by the others views.
212 EURASIAN GEOGRAPHY AND ECONOMICS
retailers, cultural professionals (especially exhibition professionals), and new cultural inves-
tors (including art gallery foundations and cultural tourism businesses). The participation of
these new cultural practitioners as well as the management and growth of the cultural network
have become dependent on government administration and funding. A vertical, bureaucratic
chain of management has superseded the old horizontal grassroots governance style.
After the states intervention, guided by the discourse of world city cultural space con-
struction, a cultural consumption network clearly replaced 798s original grassroots produc-
tion network of creative culture. A catalytic event was the 798 Creative Culture Festival,
organized by the Management Offce in October 2006. Many of 798s artists expressed dis-
satisfaction with this event, which they felt clashed with the art zones contemporary artistic
atmosphere. Following the festival, some artists left 798 of their own accord and moved to
areas neighboring 798, such as Caochangdi, Jiuchang, and Huantie. Cang Xin and several of
his neighbors in 798 have rented new studios in other locations, and they only use their 798
studios as exhibition (rather than creative) space. Cang Xins roommate Mogen moved every-
thing to Huantie. 798 is more and more like a show place. Its full of small crafts and arts
dealers, attire businesses. Its out of touch with us (798 Going, 2007). Furthermore, as part
of the strategic plans in promoting culture to spur economic growth, the city now highlights
798 as a tourist destination in its offcial literature and in sponsored television advertise-
ments (Currier, 2008, p. 248). According to Peck (2005), the over-manipulation of artistic
place commercialization always does extensive damage to the local creative atmosphere. As
such, tremendous challenges confront those who have decided to stay. Most spaces in 798
now serve the new cultural actors, instead of the artists, and the grassroots artistic network
has essentially collapsed (Philip, 2008, p. 24). Thus, as state intervention strengthened, the
Table 2. Transition of the 798 Creative Cultural Network before and after 2006
Before 2006 After 2006
Characteristics Dominated by local artists
Focus on the construction of the
cultural network
With building 798 into a creative
culture space as the objective
Dominated by the state
Focus on commercial environ-
ment and results
To promote the development of
a cultural industry cluster and
build Beijing into a world city
Major practitioner and
motives
Artists
To construct a cultural creation
space
State, business retailers, specula-
tive foundations and galler-
ies, international exhibition
professionals
Discourse and core values Discourse of creative culture
space construction
Construction of culture produc-
tion space
Discourse of industrialization of
culture and world city
Construction of culture con-
sumption space
Cultural network and
governance
Grassroots mobilization
Horizontal network, governance
built on trust and cooperation
Driven by state resources
Vertical bureaucratic governance
Cultural space growth
mechanism
Organic, internal growth
Driven by creative cultural
production
Non-organic, external investment
Driven by commercial consump-
tion forces
TSU-LUNG CHOU 213
hegemonic discourse of cultural space in the service of world city building has dramatically
transformed the previous network of cultural creation into one of cultural consumption.
Further Contradictions of Commercialization. The over-commercialization of the 798
art zone has generated infationary market pressures that increasingly have eroded its artistic
uniqueness (Ye, 2008). A serious problem for most artists, especially after 2006, was the
increasing monetary burden of rental payments to the Seven Star Group. As one local maga-
zine reported, rising rents after 2006 were threatening the artists living space (Zhou, 2006).
14

The daily per square meter rental fee increased by at least fourfold, from less than 0.5 RMB
in 2001 to more than 2 RMB in 2008. The change was even more dramatic in the subletting
market, where rents increased by a factor of 12, up to a maximum 6 RMB in 2008.
15
Dramatic
rent hikes hence represent another factor connected with the commercialization of 798 that
prompted an exodus of artists to new spaces for creative work (Ye, 2008). As artists work-
places in 798 are vacated, they have been extensively replaced by commercial art galleries
and tourist-oriented restaurants. Gallery-based commercialization is thus increasingly turning
the former production space of artists in 798 into a space for contemporary art speculation
and tourism.
This new development phrase dominated by the galleries and restaurants has thus facili-
tated the collapse of the grassroots cultural network and worsened the governance conficts
associated with spatial commercialization in 798. More importantly, commercialization is
characterized by an unpredictable future, especially in the wake of the global fnancial crisis
in 2008. The art market is highly speculative and is strongly infuenced by economic condi-
tions. During the worldwide economic recession following the crisis in 2008, one-third of
the art galleries in 798 closed, and it is expected they will ultimately be replaced largely by
tourist-oriented enterprises.
16
Following the outmigration of artists, the closure of art galler-
ies manifests a further threat to 798s future, with any subsequent organic re-development
propelled by the artists viewed as highly unlikely.
CONCLUSION
In the analysis above, I have broadly investigated policy discourse and practice surround-
ing the development of a creative culture industry and space in Beijing. The state strategy
for such development is modeled on that employed previously in the science and technology
industry, which sought to stimulate the development and clustering of industry by build-
ing infrastructure and supporting institutions. The miraculous growth of the creative culture
industry in Beijing in the 21st century has therefore been the result of the states strong inter-
vention and support (as part of a broader drive to attain world city status), with the construc-
tion of cultural infrastructure proceeding at a breakneck pace. Under such conditions, some
promising cultural clusters that emerged spontaneously, following an organic development
path, were also nationalized and their growth mode changed. The case of one such cluster,
the 798 Art Zone, reveals that after the state intervened in 2006, 798s major function shifted
from being a place where artists pursued artistic creation to a venue for showcasing a world
14
According to Huang Ruis observation on the 798 rental market before 2006, nobody left because of not being
able to afford the rent. Some people rented some places while the rent was low, and now they are subletting those
places to make a proft. No painters or art galleries will pull out. In fact, there are many people who are on the waiting
list to move in. To be fair, Seven Star Groups price is not too high. Besides, they also charged differently according
to types of spaces and people (Xinjingbao, March 9, 2006).
15
Authors interview with 798 tenant, June 19, 2009.
16
Authors interview with 798 tenant, June 19, 2009.
214 EURASIAN GEOGRAPHY AND ECONOMICS
citys cultural industry, and for cultural promotion and consumption. Although this shift has
enabled 798 to play a greater economic role, it adversely affected the creation of culture,
because the organic network of artistic production was largely replaced by a commercial net-
work focused on cultural promotion and consumption. Thus the state-sponsored construction
of cultural space in Beijing has emphasized the construction of infrastructure and institutions
for world city building, but has largely failed to support a network of artistic creation. The 798
case demonstrates that state intervention thus far has been inimical to the organic develop-
ment of creative culture space.
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