Creative Class

My past several posts have looked at the density of key economic and demographic factors across America’s metropolitan regions. Today, I turn to the density of high-tech industry and of innovation. Long ago, the great economist Joseph Schumpeter highlighted the role of innovation in powering the rise of new industries, the creative destruction of existing ones, and the growth in prosperity of economies. Robert Solow won the Nobel prize for identifying the role of technology in economic growth and development. Paul Romer has shown how the accumulation of scientific and technical knowledge is the central force in endogenous economic growth. Michael Porter and AnnaLee Saxenian, among others, have shown how clusters of high-tech companies and other economic assets have propelled the rise of new firms like Intel in semiconductors, Apple in computing, Genetech in biotech, Google in search, and countless others that have introduced not just new innovations but whole new industries and epochs of regional growth.

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My past several posts have looked at the density of key variables across America’s metropolitan regions. Today, I turn to the density of a subset of the creative class – the density of artists and cultural creatives. My own earlier research, which landed me on “The Colbert Report” of all places, showed that metros with higher proportions of employed artistic and cultural workers also have higher incomes, higher rates of innovation, and higher housing prices. The reason is not that artistic and cultural creatives are more likely to launch new businesses or invent new products, but that their location in an area signals that a community is open to diverse groups of people who are open to new ideas and self-expression. The concentration of artistic and cultural creatives in a place is a sign of a local ecosystem that is more conducive to generating new ideas and mobilizing resources around them.

Our measure for the density of artistic and cultural creatives is the number of artistic and cultural creative workers per square kilometer. The map below shows the density of artistic and cultural creatives across U.S. metro regions. The median density of artistic and cultural creatives across all U.S. metros is only .08 per square kilometer. The densest metros have more than four artistic and cultural creatives per square kilometer, while the average metro has less than a tenth of a cultural worker. (more…)

In this, the third in my series of posts on density, I look at the density of the creative class. More than 35 million Americans are members of the creative class, making up roughly a third of the workforce. The creative class is a measure of human capital that looks at what occupations people work at rather than whether they earned a college degree. The creative class includes workers in science and technology, business and management, health care and law, and arts, culture, design, media, and entertainment.

The map below shows the density of the creative class across U.S. metros. The median density across all U.S. metros is roughly 8.4 creative class workers per square kilometer. The densest metros have more than 140 creative class workers per square kilometer, while the least dense have less than one. (more…)

It’s now well-accepted that the concentration of highly skilled people or of human capital is a key element of economic growth and development. Jane Jacobs argued that the clustering of talented and energetic people in cities is the fundamental driving force of economic development. The Nobel prize-winning University of Chicago economist Robert Lucas formalized Jacobs’ insights, showing that human capital externalities, or what have been called Jane Jacobs externalities, are indeed the key factor in economic growth and development.

But most economists measure human capital on the basis of population – the conventional measure being the percentage of adults with a bachelor’s degree or above. Our analysis here takes a different approach, getting at the density of human capital by looking at the number of adults with a bachelor’s degree per square kilometer.

The map below shows the human capital density of U.S. metros. The median human capital density across all U.S. metros is roughly 7.4 people per square kilometer. The densest metros have more than 100 degree holders per square kilometer, while the least dense have less than one. (more…)

Density is a key factor in innovation and economic growth. The dense geographic clustering of economic activities was true of the industrial behemoths of the past – steelmaking in Pittsburgh and automotive production in Detroit. And, despite advances in communications technology, it applies even more so today: from high-tech firms in Silicon Valley to film producers in Los Angeles and recording studios and record labels in Nashville. There’s no doubt: The geographic concentration of firms, industries, technologies, people, and other economic assets plays a powerful role in innovation and economic growth.

The great economist Alfred Marshall long ago outlined the dynamic of agglomeration – that is, the process by which co-location of related economic activities and assets shapes industries and economic development. Jane Jacobs showed us how the clustering of diverse groups of people, firms, and industries in cities provides the basic engine of innovation and new product development. Harvard’s Michael Porter has shown how clusters of related industries, customers, and suppliers power innovation and growth. Density makes it easier for people and firms to interact and connect with one another, and it reduces the effort, friction, and energy that’s used to make these connections. Density increases the speed at which new ideas are conceived and diffused across the economy, accelerating the speed with which new enterprises and new industries are created.

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Across the world, two in 10 households have access to the Internet at home, according to a just released Gallup survey. Internet access at home was far greater in more economically advanced countries: Nearly eight in 10 people (78 percent) in countries where gross domestic product (GDP) is more than $25,000 have Internet access at home. Home Internet access drops off steeply in less affluent, less developed nations, according to the Gallup survey, especially in countries with less than $10,000 in per capita GDP. The survey is based on telephone and face-to-face interviews with approximately 1,000 adults, aged 15 and older in 116 countries, and was conducted in 2009.

The map above, by Zara Matheson of the Martin Prosperity Institute, shows the percentage of households with Internet connectivity, highlighting the top 10.

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Nashville is the Silicon Valley of the music industry – a concentrated cluster of musical talent,  venues, studios and all the inputs required to make music.  So it’s no surprise the city take the music business seriously.  In May 2009, the mayor launched a Music Business Council (h/t: Ian Swain -my MPI colleague, music project collaborator and DJ).  To signal the initiative’s importance, he sits on the council whose members not only include label execs and entertainment lawyers, but also musicians like Emmylou Harris and Jack White. The Council’s goals extend all the way from supporting and expanding the presence of music festivals in Nashville to aiming to develop the best music education program of any public school system in the world.

Nearly 40 years ago, the geographer Jean Gottmann documented the rise of the great megalopolis of Bos-Wash – the Boston-New York-Washington corridor – as a massive new kind of geographic form. My own research (PDF) has used satellite imagery to plot the rise of mega-regions – integrated systems of cities and their suburbs – across the globe. The world’s 40 largest mega-regions produce two-thirds of all economic output and nine in 10 of the world’s innovations. With their massive scale and market size, mega-regions are becoming a key economic and social organizing unit of our time.

But mega-regions are not only important to markets, economics, and technology, now it appears they are important to music as well. Case in point, the indie-rock band The Walkmen whose newest single was recently released. Half the band live in New York, half live in Philadelphia. They maintain recording space in both places, and recorded their upcoming album from BOTH studios. Walkmen frontman Hamilton Leithauser described the logistics of their arrangement to Pitchfork in February: (more…)

It’s pretty well-known that our economy – and society – is transforming from one where wealth and prosperity came from industrial products and material goods to a system where new ideas, human creativity, and experiences play a greater and greater role. As societies become more educated and basic needs are fulfilled, the attention of their populations shift to favor experiences and self-actualization over physical goods and even luxury items – what sociologist Ronald Inglehart calls the rise of “post-materialist” values.

This shift can be seen in everything from the excitement around the sleek design and user experience of the Apple iPad to the rise in sales of organic, high-quality foods.

But my sense is that perhaps the best place to observe this transition is in the rapid evolution of the music industry. Music is a highly competitive business – one I like to think of as an innovative market in miniature. Musical entrepreneurs compete not only on the basis of musical talent and their ability to create new sounds and arrangements, but also on fashion, design, business acumen, and even spectacle. Music was one of the first industries to experience the brutal effects of the digital transition, and it’s clear that the ability to make money has shifted – even for the most established acts – from selling albums, CDs, and even digital downloads to live performance and, well, designing experiences. (more…)

Food is increasingly a key element of the city and of city life. Ever at the cutting-edge of trends that are reshaping the city, Chicago Mayor Rich Daley has become the No. 1 ambassador for the city’s world-class food scene, according to this report in The New York Times.

The mayor’s pride in Chicago’s growing stature in the world of haute cuisine was on display again this week. After Mr. Daley spent much of last week in Idaho at a conference of the nation’s news media moguls, his next two public appearances in Chicago involved promoting the local gastronomy scene

The mayor made a stop at the French Pastry School on Monday to promote its expansion into new teaching kitchens at the City Colleges of Chicago. The school’s chefs had recently visited City Hall to present the mayor with a chocolate replica of the Blackhawks’ Stanley Cup trophy. The mayor beamed below the brim of a tall chef’s hat” …  “He’s the best cheerleader for the industry that anybody could ask for,” said Sheila O’Grady, the mayor’s former chief of staff who is now president of the Illinois Restaurant Association.”

Money quote: “These chefs, to me, represent the creative class of society,” Mr. Daley said. “We have to realize how important they are to the city.”