For generations New Orleans‘ appeal to artists, musicians and writers did little to dispel the city’s image as a poor, albeit fun-loving, bohemian tourism haven. As was made all too evident by Katrina, the city was plagued by enormous class and racial divisions, corruption and some of the lowest average wages in the country.

Yet recently, the Big Easy and the state of Louisiana have managed to turn the region’s creative energy into something of an economic driver. Aided by generous production incentives, the state has enjoyed among the biggest increases in new film production anywhere in the nation. At a time when production nationally has been down, the number of TV and film productions shot in Louisiana tripled from 33 per year in 2002-2007 to an average of 92 annually in 2008-2010, according to a study by BaxStarr Consulting. Movies starring Leonardo DiCaprio, Morgan Freeman, Harrison Ford are being made in the state this year.

Of course many states and cities have thrown money at the film industry, hoping to establish themselves as cultural centers. Texas, Georgia, British Columbia, Toronto and Michigan all wagered millions in tax dollars to lure producers away from Hollywood and the industry’s secondary hub of New York. There were 279 movies shot in New York State in 2009 and 2010. For all its gains, Louisiana still trails far behind the Empire State with 95 film productions in that period.

Yet New Orleans and Louisiana possess unique assets which make its challenge far more serious than that of other places. A Detroit, Atlanta or Dallas might be a convenient and cost-efficient place to make a film or television show, but they lack the essential cultural richness that can lure creative people to stay. The Big Easy is attracting that type, plus post-production startups, and animation and videogame outfits, giving a broader foundation to the nascent local entertainment industry.

“This is different,” notes Los Angeles native and longtime Hollywood costumer Wingate Jones, who started Southern Costume Co. last year to cash in on the growth in production in the state. “It’s the combination of the food and the culture that appeals to people. It must have been a lot like what Hollywood was like in the ’20s and ’30s. It’s entrepreneurial and growing like mad.”

Critically, Jones adds, Louisiana’s unique culture comes without the fancy New York or Malibu price tag. This is a place where small roadside cafes serve up bowls of gumbo, crayfish and shrimp that would cost three to five times as much in New York, the Bay Area or Los Angeles. Excellent music — from rap to jazz to blues and gospel — can be found simply by walking into a bar and paying the price of a couple of beers. And then there are housing costs, roughly half as high, adjusted for income, than the big media centers.

This mixture of affordability and culture is attracting young people — the raw material of the creative economy — as well as industry veterans like Jones. In 2011, we examined migration patterns of the college-educated and found, to our surprise, that New Orleans was the country’s leading brain magnet. New Orleans was growing its educated base, on a per capita basis, at a far faster rate than much-ballyhooed, self-celebrated places like New York or San Francisco. In fact, its most intense competition was coming from other Southern cities such as Raleigh, Austin and Nashville, the last two of which also share a strong, and unique, regional culture.

Another sure sign of the city’s growing appeal has been a torrent of applications to Tulane University, the city’s premier institution of higher education. In 2010 the school received 44,000 applications, more than any other private university in the country. The largest group, more than even those from Louisiana, came from California, with New York and Texas not far behind.

Increasingly, the Big Easy merits comparison not only to the Hollywood of the 1920s but also Greenwich Village of the ’50s, Haight-Ashbury in the ’60s and “grunge” Seattle in the mid-’80s. These, too, were once appealing places that were less expensive, less predictable and more open to cultural outsiders. Now they’re increasingly too pricey and yuppified for creative people bereft of large trust funds.

Ironically, Katrina provided the critical spark for this transformation. It devastated the torpid, corrupt political and business culture that viewed the arts as quaint and fit only as a selling point for tourists. In its place came more business-minded administrations in New Orleans and in Baton Rouge, the state capital. In both places, economic developers seized on motion pictures, television, commercials and videogames as potential growth industries that fit well with the state’s expanding appeal to this generation’s creators.

Those now building entertainment businesses in Louisiana see the state’s business climate and cultural heritage as key assets. David Hague manages the New Orleans studio of Paris-based Gameloft. When it was opening in 2011 with plans to hire 20 in its first year, he says it received a blizzard of 2,500 applications. Hague thinks the city has basic appeal for young creative people.

“Everywhere you look there is something inspiring either architecturally or historically; not to mention a thriving arts community,” he says. “When you combine all these aspects and project them forward you have the foundation to build a critical mass of employers in the industry that will keep the area competitive long term.”

The growth of games companies, special effects and other post-production houses may be even more important for Louisiana’s long-term cultural ascendency than the surge in filming. Electronic Arts, for example, recently opened a $28.2 million testing facilities in Baton Rouge, an hour north of the Big Easy. Moonbot Studios, which got started in 2009 in the northern Louisiana city of Shreveport, just won an Academy Award for its short animated feature “The Fantastic Flying Books Of Mr. Morris Lessmore,” and appears to be on the verge of becoming a powerhouse in all fields of digital animation.

These companies have the potential to give the state a long-term competitive edge. After all, generous tax breaks, like those now offered by Louisiana, can be offered elsewhere; over the past few decades, Toronto, Montreal, Vancouver, Georgia, Michigan, Texas and New Mexico have all targeted producers looking to save a buck or two. But while incentives can get film people from Los Angeles, where I live, or in the Bay Area or New York to trudge out to work for a bit in Toronto, Pittsburgh or Dallas, few ever think about settling in these places. In the end, they return to Hollywood, and New York, because a critical mass of writers, actors and technicians have congregated and enjoy being there.

Louisiana has a chance to change that dynamic. The rise of support businesses — post-production, animation houses and costumers – gives it the possibility of building a major new entertainment center. With its history, Louisiana offers more than just money and lavish praise for creators. It boasts a vibrant culture that that is not imitative of other regions or dependent on government; it is intrinsic to the place, and reflects a longstanding tradition that goes back centuries.

The rise of the local film industry has enabled the return of some creative former Louisianans who had been forced to ply their skills elsewhere. New Orleans native Huck Wirtz opened his Bayou FX post-production house in November 2010 after 17 years in the Golden State. “When I left here there was no industry to speak of,” notes Wirtz, a veteran of George Lucas’ Industrial Light and Magic. “We always had artists but they didn’t make much money. Now Louisiana culture is becoming an industry. People see the opportunity here to make this the next big place.”

By: Joel Kotkin, Contributor

http://www.forbes.com/sites/joelkotkin/2012/04/20/as-filmmaking-surges-new-orleans-becoming-serious-challenger-to-l-a/