City & Community

17 september 2007Dias 1

Cities and the Creative ClassCity & Community

Richard Florida

Nikolaos SpyropoulosDepartement of Geography

Industrial & Labor Geography 2007


Why Geography Is Not Dead

The end of Geography theme developed in the turn of 19th

century when technologies such as telegraph and automobileemerged.

”Geography and real estate, however, will remain, well real. Cities will flourish, and the value of a distinctive place, such as a wilderness area, or a charming hill vilage, will only increase”

”People will inhabit places, but increasingly the economy inhabits a place”

Kelly: New Rules for the New Economy(1998)

It appears that place (not just space) is essential to economic life as being an incubator of creativity, innovation and new industries.


Agglomeration and Cluster Theories

Place remains important as a locus of economic activity because of the tendency of firms to cluster together.

Firms cluster together in agglomerations to gain productiveefficiencies.

Examples:

Detroit Automotive Industry

Silicon Valley Microprocessor Industry

Mexico Electronics & Auto-Parts

Singapore Disk-Drive makers

Japan Flat Panel Display Producers

New York City Broadway Theater District


Agglomeration and Cluster Theories

WHY DO FIRMS CLUSTER?

1. Capture efficiencies generated from tight linkages between firms.

2. Positive benefits of co-location.3. Face to face contact.

More importantly:

Firms cluster to gain advantage of talented people who powerinnovation and economic growth. Mobilizing that talent gives a strategic advantage for companies in a time driven economy.


The Social Capital Perspective

As Robert Putman says in his work regional economic growthis associated with tight-knit communities where people and firms form and shape strong ties.

In his view:

People have become more Decline of social capitaldisconnected from one to another Basis of prosperity Society has become less trustful and less civic-minded.



Florida’s point of view:

People try to get away from such environments (e.g. church, political parties, recreational leagues)

People want to pursue their own lives and prefer weaker bonds than strong ones.

Modern societies differ from older ones in terms of generating economic prosperity.

Social structures that were important in earlier years now work against prosperity.

Older communities are being exchanged for more inclusive and socially diverse arrangements.



These new socially diverse communities are more effective atgenerating economic growth and attracting high-tech to a place.

Social capital can either

• Reinforce belonging and community or• Shut down newcomers, raise barriers to entry and retard

innovation.

Places with dense ties and high levels of traditional social capital promotes stability, while places with looser networks and weaker ties promote novel combinations of resources and ideas.


Human Capital & Urban-Regional Growth

The traditional view of city growth suggests that a city is developing if:

Is near to transportation Has natural resources routes.

(Cost-related factors)

The proponents of human capital theory argue that the key to regional growth lies in endowments of highly-educated and productive people (creative people).


Human Capital & Urban-Regional Growth

Human capital is the central factor in regional growth.

Clustering of human capital is the ultimate source of regional agglomerations of firms.

Reap the advantages Take advantage ofof common labor pools. common networks

Fact:Places with a greater number of talented people grew faster and were better able to attract more talent.


The Creative Capital Perspective

From the perspective of human capital, economic growth occur in places which have highly educated people.

Why creative people cluster in certain places?

• Economists and social scientists pay attention to how companies decide where to locate.

• However people are not making career decisions based on place of job but are drawn to places that were inclusive and diverse.



Creative People

• Are the main reason of regional economic growth.• They prefer places that are innovative, diverse and tolerant.• They shape the location decisions instead of saying the

opposite.

Creative Class

The distinguishing characteristic of these people is that its members engage in work whose function is to “create meaningful new forms”. Members of this class are:• Scientists, Engineers, University Professors.• Poets, Actors, Designers, Entertainers.• Analysts, Think Tank Researchers, Opinion makers.Typically highly educated people and thus high level of human capital.



Patterns of the Creative Class:

• Creative Class is moving away from traditional corporate communities to a set of places called “creative centers”.

• Creative centers tend to be the economic winners of our age.

• Creative centers are succeeding largely because creative people live there. All forms of creativity can flourish there.

• Creative class is looking for places that can provide high quality experiences and above all the opportunity to validate their identities as creative people.


Technology, Talent and Tolerance

The new geography of creativity is based on those three factors (the 3T’s as Florida says).

Members of the “creative class” take roots in places that possess all three of these factors.

Definitions:

Tolerance Talent Technology

Openness, Holders of bachelor A function ofDiversity degree and above innovation & high-tech concentration in a region Fact:Talented people are drawn to places that offer tolerant work and social environments.


Technology, Talent and Tolerance

Human capital theorists have shown that economic growth is closely associated with concentrations of highly educated people.

However studies of relationships between talent and technology, between clusters of educated and creative people and concentrations of innovative and high-tech industries have shown that:

• High technology and innovation are closely related with locations of the creative class.

• Regional economic growth is highly related to those 3Ts.


The Role of Diversity

Economists argue that diversity is important to economic development, but they usually meant diversity of firms and industries.

The place as space of diversity

Places with low entry barriers Open and diverse placesgain advantage by attracting are likely to attract greater talented people. numbers of talented people that power innovation and growth.


Testing The Theories

Three major theories of regional growth (R. Cushing):1. Social Capital2. Human Capital3. Creative Capital

Social capital Human & Creative capital

Little explanation of Better at accounting such growth.

such growth.

Fact:Creative communities are centers of diversity, innovation and economic growth while social capital communities are not.



Putnam in his work pointed out 13 different kinds of social capital like:• Political involvement• Civic leadership• Giving & volunteering• Protest politics • Faith based institutions

Cushing’s research method: Tech-Pole Index Innovation Index Talent Index Bohemian Index Gay Index



Results from this Analysis:

• Classical Social Capital Communities. 1. Putnam’s theory places.2. High score in social capital, low score in innovation and diversity.

• Organizational Age Communities.1. Corporate dominated societies.2. Average social capital, political involvement.3. Low levels of diversity, innovation and high-tech industries.

• Nerdistans.1. Fast growing regions2. High-tech industry.3. Above average diversity.4. Low social capital and political involvement.

• Creative Centers.1. Large urban centers.2. High levels of innovation and diversity.3. Average social capital and political involvement.

Dakota, Bismarck, Alabama.

Cleveland, Detroit.

Silicon Valley, Los Angeles, Houston.

San Francisco, Chicago, Boston, Denver.



Further results:

• High social capital communities showed a strong preference for “social isolation” and “security & stability”.

• Low social capital communities had the highest rates of diversity and population growth.

• There is no evidence (based on statistical data) that social capital leads to regional economic growth. Instead the effects were negative.

Cushing concludes that:

“Creative capital model generates equally impressive results as the human capital model and perhaps better”


Conclusion

• In the past city has been viewed as the center of physical production and trade, agglomeration of finance, service and retail activities.

• Understanding the city as an arena of consumption and for entertainment-a city that competes for people as well as for firms, a city of symbols is a huge research opportunity for sociology and geography.

• There is a huge change from industrial-organizational system of capitalist economies to new knowledge based and human creativity systems.


? Questions

•How do we measure creativity and can we say that there is “bad” as well as “good” creativity inside a firm?

•How do we maximize our creative assets? (is education enough)?

•How can we built a “creative city”? How can we attract creatives to our city?

City & Community

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