An intriguing new study by Brent Eastwood finds that both income and employment are associated with levels of economic freedom and the creative class, but less with social capital, across U.S. metros. Here’s the abstract.
The need to sustain economic growth has dominated urban policy in the U.S. for decades. Feeling pressure to meet this need, city and state governments have rushed to adapt economic policy concepts that are untested by researchers or need an updated examination. This article explores the effects of social capital, Creative Class Theory, and “Economic Freedom,” on U.S. urban economic growth. It tests a 272 metropolitan statistical area (MSA) sample and their scores on Florida’s (2002) Creative Class Index, Rupasingha et al.’s (2006) Social Capital Index, and Pacific Research Institute’s “Economic Freedom Index.” The author measures economic growth using the percent change from 2000 to 2004 in Total Employment and Total Personal Income for each MSA in the sample. The data show a highly significant and positive relationship for economic growth among MSAs with high Creative Class ratings and high Economic Freedom scores. The social capital variable had insignificant and or negative relationships as an explanatory variable for economic growth. (EastwoodNet.com; Applied Research in Economic Development, vol. 6, issue 1, 2009)
Read more here (pdf).