Inside the black box of regional development--human capital, the creative class and tolerance

Abstract

While there is a general consensus on the importance of human capital to regional development, debate has emerged around two key issues. The first involves the efficacy of educational versus occupational measures (i.e. the creative class) of human capital, while the second revolves around the factors that affect its distribution. We use structural equation models and path analysis to examine the relations from these two alternative measures of human capital and regional income and wages, and also to isolate the relations of tolerance, consumer service amenities and the university on its distribution. We find that human capital and the creative class affect regional development through different channels. The creative class outperforms conventional educational attainment measures in accounting for regional labor productivity measured as wages, while conventional human capital does better in accounting for regional income. We find that tolerance is significantly associated with both human capital and the creative class as well as with wages and income. We also find that the cultural economy has both direct and indirect relationships to regional development and impacts both production and consumption.

Creative industries, new business formation, and regional economic growth

“…Consistent with this assumption, in some studies (e.g. in Florida, Mellander and Stolarick, 2008) universities are found to be significantly associated with the presence in the same territory of both highly-skilled human capital and the creative class.…”

“…Mellander and Florida (2007) identify some conventional and less conventional measures of human capital and "talent" in factors such as the presence of universities, amenities or service diversity, openness and tolerance. Florida, Mellander and Stolarick (2008;cf. also Howkins, 2001;and Florida, 2002) discuss the role of the creativity industries, the university system, and the concentration of gay and lesbian households (taken as a proxy of "diversity") in fostering economic growth by means of a stage-based general model of regional development.…”

Up in the air: the role of airports for regional economic development

“…Romer, 1986;Glaeser, 1998;Glaeser, Kolko, and Saiz, 2001;Florida, Mellander, and Stolarick, 2008). Using the Airport Dummy also increases the sample significantly which may affect the overall results.…”

Trade between Creative Regions When the Input Elasticity of Substitution is Less than Unity

“…Donegan and Lowe (2008) contend that cities with a large creative talent pool are also more likely to have substantial income inequality. Florida et al (2008) show that the 4 See Horiba (2008), Andresen (2009), Ghemawat et al (2010), de la Mata and Llano (2013), and de la Mata (2014) for additional details on this literature. 4 creative class idea outperforms conventional educational attainment measures in accounting for regional labor productivity measured with wages.…”