Developing the Cultural Industry Value Chain for Handicraft Trades: An Approach from Value-Added Theory

This article aims to construct a conceptual model of the cultural-industry value chain of handicraft trades using the concept of value-added theory to understand why traditional crafts are so prone to being mired in low value-added production and how they can become part of a competitive cultural industry. The study is designed using the conceptual design and model-building design, which is a combination of documentary analysis, policy analysis and value-chain theory, value-added theory, and cultural-industries scholarship. By using the value added (smile) curve, the article illustrates that the greatest value is added at the intangible upstream (design, creativity) and downstream (branding, marketing, experience, services and shows) stages, while the artisans mostly focus on the middle value-added stage of production and crafting. It highlights the four upgrading pathways process, product, functional upgrading and inter-chain upgrading, and connects them to design, branding, market access, cultural tourism and digital transformation. To recognise handicraft as a cultural industry, the policy and practice of supporting volume production need to be shifted towards capturing value at the high value-added ends of the chain, whilst safeguarding cultural authenticity and delivering a more equitable value chain for artisans and communities.