The smart phones in our pockets, the tablets on our laps and the laptops on our desks, the software inside them, the web that connects them, and the online platforms built atop all of these, have transformed how we discover and consume creative content and services, and empowered many of us to express our creativity in ways that would have been unthinkable even only a few years ago.

We don't have to look far back to see how digital stones start rolling, and then eventually turn into avalanches. Apple launched the iPod in 2001, and Facebook started connecting US colleges in 2004 - the same year when Third Generation (3G) mobile Internet services were first offered in the UK.

YouTube started streaming in 2005, and the first iPhones and Kindles went on sale in 2007. The iPad and Instagram are less than three years old.

The response from UK consumers has been energetic -world-leading in their adoption of smart phones, tablets, TV on demand, social media and e-commerce. But what of the UK's creative industries, identified by the Department for Culture, Media and Sports (DCMS) as a driver of economic growth in its pioneering Mapping Document of 1998 - the same year, incidentally, when Google was founded?

We know that it is in times of disruption when leadership positions are overturned, when new industrial fortunes are made and existing ones lost. For a nation of 60 million, the UK has unrivalled artistic, cultural and creative strengths - in both commercial and public spheres - to build on digitally.

But it has much to lose if it is timid in addressing new forms of demand and online markets: that way lies lessened relevance for global audiences, and businesses that remain strong creatively, but are weak at commercial exploitation.

This raises important questions for policymakers in the UK as they seek out new sources of growth and jobs and to avoid a repeat of what happened with industries like chemicals, computing or car manufacturing, where the UK enjoyed early leads, which were then lost. Today, we launch a Manifesto for the Creative Economy that examines these issues using economic theory and the empirical evidence that Nesta and other researchers have gathered.

So far, so big

Our analysis of official micro-data reveals that the creative economy (comprising creative industries in sectors ranging from the Performing and Visual Arts to Advertising and Software, as well as creative professionals working elsewhere in the economy) accounts for almost a tenth of the UK economy, and that it employs 2.5 million people. This creative workforce grew four times faster than the workforce as a whole in the six years to 2010, and proved more resilient when the wider labour market dipped violently in 2009.

Policymakers, however, must not take this vital economic contribution for granted. The UK's creative businesses need to seize new commercial opportunities in online markets and scale up successes, and for this they need a policy framework that is fit for purpose.

The fact that the pace of change in digital technologies and markets appears to be speeding up, rather than slowing down, as such things as Big Data, the Internet of Things and 3D printing come to the fore, makes this urgent.

What should they do?

In our manifesto we argue that a system-wide approach is needed that recognises the interacting role that institutions, policies and regulations play in determining the environment in which creative businesses operate. We set out ten policy recommendations; here we mention just a few.

In the area of competition policy, a group of Internet platforms have become central in creative markets - think of Amazon and e-books, Google and search (and online advertising), Facebook in social networks or Apple and music downloads. Although according to our analysis these creative markets are at present highly contestable, we don't think this is an inevitable consequence of the Internet's architecture.

We need to ensure that the competition authorities have an informed, timely and joined-up approach to considering potential market abuses should they arise. Ofcom's duties should be broadened to fill this gap and should include a responsibility for advising government of the actions needed to ensure a flourishing, open Internet, balancing the interests of consumers and citizens and committed to supporting innovation and economic growth.

The UK education system (including schools and universities) is all too often tech-disabled, where top-down teaching takes place in disciplinary silos and seems better geared towards the needs of an analogue, industrial economy, than a digitised, creative one. We call on the Government to make a Schools Digital Pledge to ensure that the school curriculum brings together art, design, technology and computer science and that young people are able to enjoy greater opportunities to work creatively with digital technologies, both in and out of school.

The vast majority of creative businesses are small, their innovations typically don't involve lab researchers in white coats, or the creation of patents, and their business models are less familiar to general investors. As a consequence, they tend to be discriminated against by current policies aimed at supporting innovation and improving business access to finance and which were developed with sectors like pharmaceutical and manufacturing in mind.

This situation is no longer acceptable. Policymakers' attention to the needs of the creative economy needs to be commensurate to its weight in the UK economy.

Taking the creative economy seriously

Tim Berners-Lee, the inventor of the web, says that "the web as I envisaged it, we have not seen it yet. The future is still so much bigger than the past". We agree. We believe that, if acted upon, our ten recommendations will help ensure that the UK plays a central role in designing that future and benefiting from it, turning the creative excellence for which the UK is renowned the world over into commercial excellence in online markets.