Creative Class

Nowadays, you cannot talk about higher education without the conversation including economic development. Published economic impact studies indicate that campuses are major contributors to their economies. Look at these figures:

• Canada’s Universities – $30 billion
• Duke University – $3.2 billion
• Harvard University – $5 billion
• Michigan’s University Research Corridor – $14.5 billion
• UC San Diego – $7.2 billion
• University of Toronto – $5.4 billion

This week, the University of Dayton (UD) purchased NCR Corp.’s former world headquarters for $18 million. The location will house the university’s world-class research institute and provide space to work on projects that will stimulate commercialization, business growth, and local job creation. In a region that has endured substantial job loss, UD continues to be a vital economic engine and key contributor to the economic future of Dayton.

While these examples demonstrate major economic contributions by campuses, do they impact economic development policy for a region, state, or nation? Do such stories and economic studies influence policymakers to direct new investment in, to take David Miller’s term, campus entrepreneurship? If you have examples, please share.

Happy Holidays!

“When you bring artists into a town, it changes the character, attracts economic development, makes it more attractive to live in and renews the economics of that town. “There are ways to draw artists into the center of things that will attract other people.”

National Endowment for the Arts, Chair, Rocco Landesman in the New York Times.

The new chairman said he already has a new slogan for his agency: “Art Works.” It’s “something muscular that says, ‘We matter.’ ” The words are meant to highlight both art’s role as an economic driver and the fact that people who work in the arts are themselves a critical part of the economy.

“Someone who works in the arts is every bit as gainfully employed as someone who works in an auto plant or a steel mill,” Mr. Landesman said. “We’re going to make the point till people are tired of hearing it.”

Earlier this week, Foreign Policy released the latest edition of its Failed States Index (via Daily Dish’s Patrick Appel). It’s based on a database of 12 indicators of state cohesion and performance for 177 nations. So my colleague Charlotta Mellander decided to compare it to our Prosperity Institute economic development database which has a wide range of indicators for output, productivity, human capital innovation, life satisfaction, human development, and economic structure. The findings, while not particularly surprising, are nonetheless interesting. FP asks:

“[W]ho (or what) is to blame when things go bad—corrupt leaders, dysfunctional societies, bad neighbors, a global recession, unfortunate history, or simply geography itself? ”

The simple answer that comes from our analysis is development – or lack of it. Failed states not only fail on state cohesion and performance, they also fail on measures of economic development from output or GNP per capita and total factor productivity to human capital, life satisfaction, and more. And failed states apparently lag badly on the transition to knowledge-driven, creative economies.

Richard Florida is a featured speaker at Large Cities: Engines of Economic Development, the 34th Congress of the ASDEQ, and will appear at the Hotel Hilton Bonaventure in Montreal on Thursday, May 7. About the conference:

The economic growth of regions and countries depends on the economic vitality of their major cities. What are the factors that determine the turn of the century, the dynamism of a big city? How does Montreal fare as an engine of economic growth? These are the topics to be discussed at this conference.

What are the factors/elements/people/occurrences that make your city economically dynamic?

Last week, we discussed D.C.’s quick aggregation of power and wealth in recent years and months. At the other end of the spectrum is Detroit. A combination of factors has put the Detroit Metro in its current situation; the WSJ had a few interesting pieces over the last week on the failed metropolis.

Firstly, a book review of Luke Bergmann’s Getting Ghost, a non-fiction account of life in Detroit for two young drug dealers: Dude and Rodney. From reviewer Julia Vitollo-Martin:

Mr. Bergmann offers no cheery prognosis – not even the vague possibility of a better tomorrow. His story ends grimly enough. Dude is found guilty of involuntary manslaughter for killing a man and is sentenced as an adult to a minimum of 10 years in the state penitentiary. Rodney, who had been trying to turn his life around by starting a car wash, is murdered in a hail of bullets, presumably by associates in the drug trade. The girlfriends of both young men struggle on, raising children, caring for troubled relatives, trapped in their neighborhoods, perpetuating a communal downward spiral.

A Detroit Free Press reporter, Barbara Stanton, once wrote of the city’s troubles: “Instead of a single, stupendous explosion, there is a steady relentless corrosion.” “Getting Ghost” allows us to see such corrosion working its way through individual lives and, it would seem, through the very soul of a city.

While Bergmann’s book seems to paint a pretty grim picture of Detroit, Governor Granholm of Michigan is flashing a billion dollar smile. Her latest idea to ‘Save Detroit’ comes from the old film/entertainment subsidy play book.

According to the WSJ, Granholm is planning to build a $54 million film studio on the site of a shuttered auto plant in Pontiac. There are many incentives as part of the plan and apparently (according to DetNews.com) there is an animation studio going in on the site of a former casino in Detroit. The state is expecting up to 5,000 or so jobs from these efforts and a thriving film industry.

Anyone in Detroit or L.A. or Austin have thoughts on this? Is Granholm onto something? Producers, actors, directors, special effects folks – are you heading to Michigan? Can the state legislate and lead creative industries?

Earlier this week Richard posted on movie production incentives as a development tool. This weekend’s WSJ has an interesting editorial by Jerry Bowyer investigating NFL Conference Championship teams Pittsburgh, Philadelphia, and Baltimore’s use of stadium centric development in recent years. (The Arizona Cardinals, based in the Phoenix-metro, is the fourth team playing this weekend.)

From the Op-Ed, Sports Mania Is a Poor Substitute for Economic Success;

“If there ever was a time to crow about the wonders of rebuilding a city around a professional sports team, this would be it. Three of the four teams remaining in the play-offs hail from cities — Baltimore, Philadelphia and Pittsburgh — that in recent years spent billions rebuilding their downtowns around pro sports facilities and other community “anchors.”

Except that there’s a problem. The teams might be competitive, but the cities definitely are not. All three continue to shrink in population, and have stagnant job markets and crumbling public schools.”

And later,

“When the Steelers were in the Super Bowl in 2006 I was the host of a radio show in Pittsburgh. I argued that the franchise was an exercise in leadership excellence in a city whose politicians were anything but. Numerous callers hammered me. They said there are a lot of “Steelers” bars across the country, and that proved the city still had some national respect. Indeed, there are hundreds of watering holes dispersed across America loaded with fanatical devotes of the Pittsburgh Steelers. “Where are the Seahawks bars?” the callers asked.

In Seattle, of course. That city has gained population while Pittsburgh lost it. Steelers bars are the visible cultural artifact of a kind of economic diaspora.”

I am a huge sports fan and appreciate many of the new stadiums across the country and know the record is mixed – look at the benefits of the privately financed Verizon Center in D.C’s China Town. Clearly the devil is in the financing details and the overall balance of the regional economy as to whether stadiums help or hurt economic success.

Today, CEO-Read announced it’s “100 Best Business Books of All Time.” Among the top 100, The Rise of the Creative Class.

Congrats, Rich!

How has The Rise of the Creative Class shaped your area’s approach to community and economic development? Has the book changed your perspective on creativity and talent management? How? Share your stories with our team.

To learn more about the guide for the top 100, click here. The guide is set to be released in February 2009.