June 1, 2002
Creative Cities and Their New Elite
hould Pittsburgh recruit gay people to jump-start its economy? Should Buffalo another fiscally flat-lining city give tax breaks to bohemians? As policy prescriptions go, these sound absurd. But according to a new theory devised by Richard Florida, a professor of regional economic development at Carnegie Mellon University, towns that have lots of gays and bohemians (by which he means authors, painters, musicians and other "artistically creative people") are likely to thrive.
To understand why gays and bohemians are linked to prosperity, Mr. Florida explains, you must first understand something else: the role of an emerging economic force that he dubs the "creative class" and that civic leaders in dozens of communities regularly fork over $10,000 to hear him discuss.
Comprising doctors, lawyers, scientists, engineers, entrepreneurs and computer programmers almost everyone, in short, who is paid to think for a living the creative class now accounts for nearly 30 percent of the workforce, Mr. Florida writes in his new book, "The Rise of the Creative Class: And How It's Transforming Work, Leisure, Community and Everyday Life" (Basic Books). That's double what it was 20 years ago and 10 times what it was at the turn of the last century. Already the dominant economic group, he argues, the creative class is likely only to grow as what it produces ideas, information and technology becomes an ever larger part of the national economy. "Creativity has come to be valued," Mr. Florida writes, "because new technologies, new industries, new wealth and all other good economic things flow from it."
Mr. Florida, 44, is hardly the first person to stress the importance of this new group of creative types. The sociologist Daniel Bell predicted its rise 30 years ago, and social scientists have been writing about it ever since under labels ranging from "knowledge" and "information" workers to "symbolic analysts." Two years ago, the journalist David Brooks documented the creative class's bloated bank accounts and weakness for
In short, as Paul Romer, a professor of economics at Stanford University put it, there is growing recognition that when it comes to economic growth, "the relatively well educated and relatively creative are disproportionately important."
Where Mr. Florida adds a new twist, however, is to argue that while the creative class is unquestionably a blessing to the economy as a whole, at the regional level the picture is hardly so rosy. Heralding a "pattern of geographic and class segmentation far worse than any we've ever had," he says, the creative class may mean boom times for one city and obsolescence for another. The reason, he contends, is that this tattooed and espresso-sipping set is unusually finicky. According to conventional economic theory, workers settle in those cities that offer them the highest-paying jobs in their fields. But creative-class workers, Mr. Florida says, are more particular: they choose cities for their tolerant environments and diverse populations as well as good jobs.
This is where gays and bohemians come in. Towns that have lots of them, Mr. Florida argues, are more likely to have creative-class workers, high-tech industry and, as a result, strong economic growth. Not because there are disproportionate numbers of gays and bohemians in high-tech jobs, he explains, but because their presence signals an open-minded and varied community of the sort that appeals to software engineers and entrepreneurs. (Race, he says, turns out to be less useful as a marker of tolerance because cities with great racial diversity overall are often highly segregated.)
This, in essence, is Mr. Florida's "creative capital theory." As he put it during a recent interview in Manhattan, "You cannot get a technologically innovative place unless it's open to weirdness, eccentricity and difference."
To make his case, Mr. Florida draws on data from the United States Census Bureau and the Bureau of Labor Statistics as well as a dizzying array of evocatively titled lists. His book includes a creative class index (ranking cities by the percentage of creative workers in their labor force); a high-tech index (ranking cities by the size of their software, electronics and engineering sectors); an innovation index (ranking cities by the number of patents per capita); a talent index (ranking cities by the percentage of college-educated people in their populations); a gay index (ranking cities by the concentration of gay couples in the population) and a bohemian index (a similar ranking of "artistically creative people"). Like Olympic decathletes, some cities tend to perform well by nearly every measure.Mr. Florida says the "most successful places" are the ones that combine all "three T's" tolerance, talent and technology.
Take San Francisco. Not surprisingly, perhaps, it ranks first on the high-tech index and the gay index, comes in fifth on the bohemian index and the innovation index and 12th on the creative class index. It was no accident, Mr. Florida contends, that Silicon Valley took root just a few miles away: "Silicon Valley was near San Francisco, where the geeky engineer with hair down to his waist and no shoes walks into a bar and no one blinks."
And given these scores, it's no wonder that San Francisco takes the top spot on the most important list of all: the creativity index, which ranks cities according to their overall performance and which Mr. Florida calls "a barometer of a region's longer run economic potential."
Other cities on the creativity index are more surprising. Texas is not a state generally thought of as a bastion of tolerance or technological innovation. But three Texas cities Austin, Dallas and Houston rank among the list's top 10. (New York City placed a respectable ninth.)
Mr. Florida said even he was shocked by Texas's robust showing. "It's very impressive," he said. "My indicators are very strongly associated with employment growth, technological growth and population growth. Each of these cities has grown substantially. Austin is a growth miracle. It has a great university and has long been a lifestyle mecca for gays and bohemians. But 10 to 20 years ago, if anyone said `Austin,' you would have said, `Huh?' "
Most economists would agree, but that doesn't mean they buy Mr. Florida's creative capital theory as the explanation. "My view is that the best thing in terms of economic development is to invest in your centers of higher education," said Mark Zandi, chief economist at Economy.com, a company in West Chester, Pa., that tracks regional growth. "It's no surprise that Austin came up in the last 10 to 15 years. The University of Texas got all that oil money and invested it in technology."
Moreover, he points out, Mr. Florida's theory fails to account for the extraordinary success of some non-high-tech centers like Las Vegas. More popular with gamblers and tourists than computer geeks, Las Vegas ranks a dismal 47th out of the 49 cities on the creativity index. Yet it had the fastest job and population growth of any major American city in the 1990's.
Edward L. Glaeser, a professor of economics at Harvard, said that high numbers of skilled, creative people are clearly good for urban economies. But he was skeptical about tolerance. "I don't know that anyone has shown that tolerance is or isn't deterimental to city growth," he said. "If you wanted to predict growth in the 90's, you would look at warmth, skills and sprawl low-density car-driven culture."
Despite such caveats, however, civic groups in several cities including Providence, R.I.; Memphis; Indianapolis; Phoenix; and Bellevue, Wash. have found Mr. Florida's ideas compelling enough to hire him as a consultant.
And this spring, The Austin American-Statesman gave his theory an informal boost. Determined to find the best explanation for why the city's population doubled in the last 10 years, the newspaper asked Robert Cushing, a retired sociologist at the University of Texas in Austin, to test several academic theories: the "social capital theory" developed by the Harvard political scientist Robert D. Putnam, which says economic growth is tied to the amount of civic participation and social cohesion in a community; the "human capital theory" associated with Mr. Glaeser and the University of Chicago economist Robert E. Lucas, which says economic growth is driven by concentrations of educated people; and Mr. Florida's creative-capital theory.
Mr. Cushing began with the social-capital theory. But using Mr. Putnam's own surveys, supplemented by census data, Mr. Cushing could find no positive connection between rates of civic participation and economic growth. "We came away with nothing," he said. "That doesn't mean there's nothing to the social-capital theory, but in terms of linking it to economic prosperity or urban growth, it was not the least bit helpful."
Mr. Cushing went on to test the human-capital theory. But though he found an impressive correlation between a city's percentage of college-educated people and growth, he was not completely satisfied. "There are more than 100 university communities, and only 20 cities stand out as places in which it would appear that high-tech development is quite outstanding," Mr. Cushing said. "How do we explain Austin?"
Finally, and with a good deal of doubt, he turned to Mr. Florida's theory. "When you hear about these cities that have gays or bohos, it doesn't sound scientific," he said. "It sounds gimmicky." To his surprise, the creative-capital theory turned out at least after preliminary testing to provide the best explanation for Austin's high-tech transformation. "I started the exercise very skeptical of the creative-class notion," said Mr. Cushing, whose findings are discussed in a continuing series of articles in the American-Statesman. "And was astonished by the results."