What Economists Say About It

Conventional economic wisdom cites such factors as infrastructure, education, crime rates, labour mobility and lack of corruption being determinants of economic success. By these criteria, all medium sized Canadian cities would score very high, in fact much higher than large cities. Yet, these cities are not growing…

Richard Florida has studied urban growth and the factors determining it. His studies point to other factors than those given above as being important for urban growth. His findings point to the existence of a “creative class” whose members are now determining the economic performance of US cities. Cities that can attract and hold members of this class tend to have similar characteristics and thus he has recommended that cities focus on three mutually necessary factors – Talent, Technology, and Tolerance.

Of these, tolerance has caused considerable controversy, as he measured this using a “bohemian index” and a “gay index”. These indices measure the per capita concentration of artists/musicians and similar professions, and the number of same-sex couples on US censuses, respectively. Somewhat surprisingly, these indices were the best at predicting economic performance compared to indices of technology, education, or immigrants per capita.

For cities to prosper he recommends that they create an environment that welcomes diversity, that supports creativity, and which provides a variety of cultural amenities. These cultural amenities include outdoor sports opportunities, a vibrant nightlife, a vibrant music scene, cafés and restaurants open at all hours etc. As well, for a city to succeed, it must be able to utilize the creative and entrepreneurial drive of this class by providing accessible sources of start-up capital, and effective networks between new start-ups, the cultural scene, and the mainstream.

The class is composed of people with much education, entrepreneurial drive, and who identify with the cultural scene of urban environments. Florida characterises these people as highly mobile, and who prioritise a city’s lifestyle and cultural amenities over immediate job opportunities.

This approach is very refreshing, and does provide a welcome contrast to traditional analysis of urban development. However, his theory does not really show how to create a vibrant city. Also, what it could be showing is that the creative class is attracted to vibrant, growing cities, rather than creating them. By his indices, most major and many minor Canadian cities score well. However, this does not mean that medium sized cities in Canada are faring well.

Also, large cities tend to be older cities, and tend to provide more diverse cultural amenities than smaller cities. The creative class is very mobile and members specialize in niche markets and so are attracted to large, vibrant cities with large and deep markets. Thus, size is a large factor in this index, so small and large cities shouldn’t be compared. He does acknowledge this, and usually compares cities of similar sizes. By his own indices, small cities tend to score lower when compared to large cities, and any high scores by small cities tend to be for one factor, rather than all three.

The environment attractive to the mobile creative class is actually attractive to everybody. If a city caters to it’s own poorer classes in a way that encourages them to start their own businesses, it will almost certainly create a favourable environment for the creative class. For the most part creative class people can take care of themselves – being well educated, driven, and mobile. It is the people who lack these advantages that cities must strive to help.

Published in: on September 5, 2006 at 12:55 am  Leave a Comment  

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