3 The Creative Class Paradigm: Richard Florida, Charlotta Mellander and Patrick Adler

3 The creative class paradigm
Richard Florida, Charlotta Mellander and Patrick Adler
The Rise of the Creative Class (Florida, 2002a, hereafter Rise) has enjoyed unusual
impact both on the practice of economic development and on academic debate. It has
been less than a decade since the book was published and it already stands as one of the
most referenced texts in economic development and urban sociology. A Google Scholar
search in early 2010 showed that 2584 subsequent works had cited it to that point, edging
out Jane Jacobs’s (1969) seminal, The Economy of Cities (2403 citations) and Louis
Wirth’s (1938) ‘Urbanism as a way of life’ (2433 citations).
What accounts for the book’s academic traction and the ensuing debate it gener-
ated? First and foremost, Rise was the first work that really synthesized the emerging
construct of ‘creativity’, coursing through psychology, economic history and regional
science in the kind of straightforward language that practitioners as well as academics
could understand. It draws off earlier work by Jane Jacobs (1961) and especially by Åke
Andersson (1985) on the role of creativity and of the intersection of people’s creative
capacities and place to situate creativity in the context of regional development. Rise also
successfully integrated two divergent streams of thinking in urban economics: one which
held industry and university location paramount to growth, and a second, more recent
stream which focused on the autonomous decisions of human capital or skilled labour.
By adopting place as the organizing unit of economic growth, replacing the corporation
which played that role in the industrial age, its 3 Ts model of economic development
attempted to unify the chicken-and-egg question of whether jobs or people lead eco-
nomic development.
THE CREATIVE CLASS APPROACH IN BRIEF
So what exactly is the creative class approach? Florida, drawing off earlier seminal
contributions by Karl Marx (1906), Joseph Schumpeter (1942) and more recently Peter
Drucker (1993), Daniel Bell (1961, 1973) and others, points to the rise of a new social
class rooted in knowledge work or mental labour. The class is made up of workers span-
ning industries such as science and technology, arts, culture and entertainment and the
knowledge-based professions. It has grown from roughly 5 to 10 per cent of the work-
force at the turn of the twentieth century to roughly a third or more of the workforce in
the advanced economies by the early twenty-first century. It draws attention to the role
of occupation as opposed to industry as a key lens in understanding economic change
and regional development.
Rise presents a model for urban growth called ‘The 3 Ts of Economic Development’. It
suggests that in the post-industrial era, successful regional economies need to cultivate an
ecosystem incorporating high levels of talent, high-technology industry concentration,
low barriers to entry for talent and high degrees of social heterogeneity (or tolerance).
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The creative class paradigm 57
While its effect was transformative, Florida’s book essentially draws together several
branches of economic development theory with long histories. Marx (1906) and
Schumpeter (1942) focused on the intersection of innovation and socio-economic struc-
tures in powering economic growth. Robert Solow (1956), Robert Lucas (1988) and Paul
Romer (1986, 1987, 1990) explored the relationship between technological innovation
and economic growth, emphasizing in particular the role of high-tech workers. Studies
of Silicon Valley and Route 128 (such as Saxenian, 1996) highlighted the dynamics
through which technology played a role in the emergence of those two highly productive
regions. Rise also builds on contributions by the likes of Robert Barro (1991), Edward
Glaeser (1994, 1998) and Glaeser et al. (2001) that emphasize the role of skilled labour
in development – more specifically, the role of skilled workers in explaining urban and
national growth. In highlighting the importance of diversity, the 3 Ts theory extends the
work of national-level theories (Inglehart, 1977; Dei Ottati, 1994; Welzel et al., 2003)
that posit a relationship between social openness and growth.
This chapter seeks to situate the contribution of Rise and the creative class approach
in the context of the broader literatures on technological change, economic development,
socio-economic class and regional development. It begins with a review of the regional
growth literatures that Rise drew upon and sought to contribute to and a discussion of
how the book sought to contribute to this broad and important field of research. The last
section highlights the debate and dialogue about the book and advances in understand-
ing regional development that comes from this ongoing dialogue.
WHERE RISE COMES FROM
Rise took the primacy of the firm as a core unit of analysis in economics, economic
geography and regional science as one of its core challenges. For much of its history, the
study of regional economic growth focused on the firm as the primary scale of analysis.
As the basic unit of industrial districts, the central unit in industrial organization, and
the source of technology, the firm was said to be central to increasing productivity and
growth. Locations encouraged economic growth by attracting investment from else-
where and by commercializing local knowledge.
The geographic clustering of firms that do not formally cooperate (and may even
compete) with one another was said to be an important contributor to regional growth.
Clusters realize at least four economies by co-locating. Alfred Marshall (1890) was the
first to describe them, and his work has found contemporary resonance in the likes
of Michael Porter (1994) and Gabi Dei Ottati (1994). The first economy is access to a
larger and specialized pool of subcontractors. The second is more efficient communica-
tion, thanks to closer proximity and more opportunities for ideas to be transmitted and
absorbed. The third is access to a shared labour market with a specialized set of skills.
The fourth is less concrete, relating to the un-transacted and immeasurable ‘atmosphere’
of trust (Dei Ottati, 1994) that results when humans are in the same place for a long time.
According to numerous studies in the 1980s and 1990s, these spillovers, in particular
the final one, found their embodiment in the regions of Emilia Romagna, Italy and
Baden-Württemberg, Germany (Piore and Sabel, 1984; Bellandi, 1989; Goodman, 1989;
Sforzi, 1989; Cooke and Morgan, 1990). Silicon Valley and Los Angeles were cited as the


58 Handbook of creative cities
North American archetypes of industrial clusters. Each of these districts was dominated
by a large number of small producers with fairly even power relations. But the forces
of agglomeration did not apply solely to small firms. Dominated by large firms and the
state, more hierarchical clusters were observed in other places (Markusen, 1996), and
they reinforced the importance of industrial clustering.
There is also a strong tradition of work known as the (New) Urban Economics (NUE)
that explains agglomeration economies and locational choices as a function of trans-
portation costs (Alonso, 1960, 1964; Fujita, 1985, 1988; Krugman, 1991). Based on the
tradition of J.H. von Thünen ([1826] 1966), Walter Christaller (1933) and August Lösch
(1940), the NUE provides a micro-fundamental basis for urban spatial structure studies
(Alonso, 1960, 1964; Muth, 1961, 1969; Mills, 1967). Based on von Thünen-like models,
the regional structure is envisioned as a flat plain with a single, well-defined central
business district and equal transport costs in all directions. The structure of the city is
determined by incomes, tastes, housing, commuting conditions and the relative use and
pricing of urban/non-urban land. From this, an optimal level of population or housing
density can be derived as a function of the distance from the central business district. The
approach implies that all regions have an optimal size, and that they are monocentric,
with just one city core.
Research into industrial districts cannot be divorced from the larger issue of ‘post-
Fordist’ economic organization that dominated economic geography in the last part of
the twentieth century. The process of deindustrialization in the last quarter of the twenti-
eth century and the migration of capital away from the large factories of the Midwestern
‘rust belt’ prompted scholars to seek out a new economic and regulatory system of accu-
mulation to serve as an heir to Fordism.
Industrial clusters were said to possess features of a new type of capitalism: flex-
ible specialization (Piore and Sabel, 1984; Storper, 1994). Greater agglomeration
among similar industries was one feature. The products produced by these districts
were less standardized, and the machinery used to produce them was less specialized.
Technological plasticity enabled workers to have expertise in a wider range of products
(Storper, 1994), and led to more continuous firm learning. The role of learning under
flexible specialization was emphasized in Florida and Kenney’s early research on the
organization of Japanese firms (1993). They found that the flexible and extremely suc-
cessful ‘Toyota System’ involved shop floor workers in the innovation process and was
rooted in continuous learning.
Innovation itself becomes a topic of inquiry for those interested in the post-Fordist
accumulation. The work of Solow (1956) carved out a new role for technology in eco-
nomic growth theory. Technological change was said to be an important component of
productivity growth in the post-war period, and an area in which increasing economic
returns could be realized. Regional economists were interested in how this process
was initiated at the local level. It would be perilous to summarize the entire ‘regional
innovation literature’ in such a short space, but the strand with the clearest links to
the creative thesis is concerned with the role of the university in the development of
technology. The view that universities might be engines of innovation was widely
subscribed to. According to the ‘linear model of innovation’, innovations flow from
university science to commercial technology (Smith, 1990) through regional channels.
Adam Jaffe (1989) concludes that university research made corporate research more


efficient. Anselin et al., (1997) found that university research tends to attract corporate
research labs.
While this strand of research was concerned with how universities produce knowl-
edge, it was every bit as firm-focused as the industrial districts literature. The impact of
the university was measured at the firm level, through variables like new firm formation
and patent licensing. It was concerned with the co-location of institutions, industries
and firms, and largely elided regional factors such as occupational mix, amenities or
built form which might explain why some strong universities spawn significant regional
growth (Stanford, MIT, Harvard) and others (Carnegie Mellon, Rochester Institute of
Technology) do not. While many studies examined the firm characteristics that contrib-
uted to commercialization (see Cohen and Levanthal, 1990; Anselin et al., 1997) there
was not a similar focus on the broader factors that contribute to a place.
HUMAN CAPITAL THEORIES
Rise also was influenced by and sought to broaden the emphasis on talent or human
capital. To do so, it sought to shift attention from education as a key determinant of
human capital to occupation. Spurred by Marx’s (1906) insistence that it is the work
people do that really matters, Rise sought to shift attention to the way the shifting role of
the worker in production – that is, in actual work – shapes society and regional develop-
ment. Rise argues that occupation provides a better and more nuanced measure of skill
than education on two dimensions. One, it enables those who engage in knowledge-based
or creative work but do not have college degrees, such as many leading entrepreneurs,
to be counted. And two, it provides a way to look at the actual composition of regional
economies strategically. Education-based measures are quite broad, but occupations
can be analysed in a way that is similar to industries. Regional economies can be broken
down and analysed in terms of their leading component occupations.
In the extant literature, labour had always been viewed as an important input in the
process of firm location but was not, until the turn of the century, posited as an inde-
pendent factor that might contribute to urban growth.
The theories we have reviewed up to this point considered human capital to be an
important feature of firm location. Skilled workers were, alternatively, the source of
agglomeration economies, an input increasing in value under post-industrialism and a
connection between universities and firms. The arrival of human capital theory disentan-
gled the education decisions of skilled people from those of firms.
This new perspective on human capital originated primarily in economics. Gary
Becker (1964) and Jacob Mincer (1974) establish that regional wage levels vary with the
level of human capital. Romer (1986, 1987, 1990) suggests that the rate of invention is
a local feature, determined both by the presence of a knowledgeable workforce and the
pre-existing stock of knowledge. This countered Solow’s contention that technology
was exogenous to the production system. Lucas (1988) shows that knowledge not only
improves an individual’s productivity, it also improves the productivity of the people
around her. This insight that clustered knowledge workers create positive externalities
for the local economy added formal support to Jacobs’s long-held argument that cities
are able to ‘make old work out of new’ (Jacobs, 1969).


Research in regional economics began to link educational attainment (one measure of

knowledge and skill) to regional economic performance. Building on the work of Barro
(1991), who linked national economic performance with attainment, Glaeser and col-
leagues (1995, 2001; Berry and Glaeser, 2005) chronicled a positive relationship between
high educational attainment and the growth of local incomes and populations. Glaeser’s
work on the growth of sunbelt cities and high-amenity urban centres helped to demon-
strate that the locational preferences of human capital were distinct from those of firms.
Vijay Mathur’s (1999) important paper in Economic Development Quarterly brought the
new focus on human capital into the regional development literature.
Explanations for why human capital concentrated in certain places centred on the
presence of local amenities. Jennifer Roback’s early work on amenities (1982) explains
wage differentials in American cities via a battery of amenities such as weather, housing
quality and crime, a series of variables that more recent research has examined more
closely. Other studies have highlighted the correlation between the presence of cultural
amenities (cafes, artistic institutions) and growth (Glaeser et al., 2001; Lloyd and Clark,
2001; Lloyd, 2002). Amenity-based theories of economic growth find that the consump-
tion preferences of skilled individuals play an increasing role in regional growth.
THE CREATIVE CLASS APPROACH
So it was with all this in mind that the creative class approach appeared. And in this sense
– drawing from these broad literatures and Florida’s previous work – the approach rep-
resents an important fusion of the ‘firm (or technology)-centred’ and ‘people (or human
capital)-centred’ growth literatures, with place, as noted before, as the central organizing
principle bringing them together. Like the work on human capital, it emphasizes the role
of knowledge location for regional economic growth while suspending the assumption
that workers ‘go where the jobs are’. Like some of the most useful firm-centred growth
literature, its focus is on the fundamental mechanisms of economic growth, eliding
factors such as individual taste and generational tendencies that amenity-based theories
of economic growth (for instance, Glaeser et al., 2001; Clark et al., 2002) tend to hold as
paramount. While some (see Storper and Scott, 2009) have criticized the human capital
work for its over-simplicity, the 3 Ts theory incorporates some of the human capital
school’s perspective that education will impact growth to a greater extent in the post-
industrial era.
THE ‘3 TS’ OF ECONOMIC DEVELOPMENT
The creative class model of economic development views place as the most significant
economic unit where human capital and firms resolve their location preferences. Growth
does not simply occur in the places that lower firm costs or improve output in an aim to
be as ‘business-friendly’ as possible. Instead, it occurs in places that allow individuals to
‘maximize their utility and not just their income’ (Clark et al., 2002, p. 496). The 3 Ts
theory assumes that firms which rely on skilled labour will have to trade inefficiencies in
other areas for access to human capital. For instance, they might locate in places that


have higher taxes if those places also provide access to a skilled labour force. As eco-
nomic units that rely on income, skilled labour must likewise consider the availability of
jobs when they make their location decisions. Each of talent, technology and tolerance
are necessary but not sufficient conditions of place. Economic growth occurs in regions
with substantial levels of all three.
The first set of variables is related to technological activity. Drawing upon contribu-
tions from Marx (1906) to Schumpeter (1942), Solow (1956) to Romer (1986, 1987,
1990), the theory views economic growth as a function of technology and innovation.
The Technology Index is composed of two technology- and industry-related location
quotients. The first captures the percentage of regional output contributed by high tech
as a percentage of a nation’s high-tech output. The second measures the share of regional
output contributed by high tech.
Talent is the second T. While place is the most significant economic unit in the 3 Ts
model, talented workers are its most significant actors. The first group of variables that
explain growth fall under the umbrella of ‘talent’. Talent is a direct measure of the share
of high-skill workers in a region at a given time. Skill is measured in two ways in 3 Ts
models: on an educational basis and on an occupational one. The latter constitutes the
creative class. Occupational skill is measured as the percentage of people engaged in
‘non-routine occupations that require creative problem solving and/or the generation of
new forms’. Occupations in this creative class include occupations related to: computer
and programming, architecture, engineering, social science, education and library, arts
and entertainment, sports, media, managers, finance, law, health related and high-end
sales (Florida, 2002a). In keeping with previous work on human capital, educational
skill is measured by the attainment of a bachelor’s degree or higher. Like other models of
human capital growth (Becker, 1964; Mincer, 1974; Glaeser, 1994, 1998), the 3 Ts model
assumes that high-skill workers are more productive and command higher wages and
incomes than workers at large, and thus help to improve income and wage accumulation
across the region in which they live.
Tolerance is the third T. Florida has elsewhere said that he believes this focus on
socio-cultural or non-market factors may be the greatest contribution of the approach.
Economists have long neglected these factors. As noted above, they view both talent and
technology as stocks that are accumulated in places. But it is clear from the empirical
literature that both are highly mobile factors. They are more aptly characterized as flows,
not stocks. But what accounts for these flows? While Rise makes a series of arguments
about physical place-based characteristics and what is termed quality of place, emphasis
is placed on a key factor in realizing these flows – openness to human capital or open-
ness to people. This openness requires tolerance, which is measured not through opinion
surveys or attitudes but observed locational preferences. The three tolerance variables
are based on key indicators of these observed locational preferences which reflect low
barriers to entry for people. Each measures a population that has traditionally faced
considerable discrimination and segregation and has been treated as outsiders. The
Mosaic Index measures the percentage of a region’s residents born in another country.
The Bohemian Index measures the share of artists – a population that trades in challeng-
ing convention perhaps more than any other. The Gay Index measures the fraction of the
population made up of same-sex partners who reside in the same household.
This emphasis on talent accessibility is based in the assumption that human capital is


a dynamic ‘flow’ and not a stock (Florida, 2005). Unlike many physical resources, skilled
labour is mobile. Where it locates is dependent on a multiplicity of factors, most of which
have not yet been accounted for. But places with high barriers of entry to outsider groups
are less likely to be welcoming and supportive of outsiders in general – including skilled
outsiders.
THE CENTRALITY OF PLACE
Rise situates place at the very centre of regional development, and it is through the lens
of place that the approach seems to unify ‘firm-focused’ and ‘people-focused’ theories of
urban growth.
Like the rest of the human capital literature, it severs the assumed relationship
between the geography of industry and the geography of talent. Human capital has
ceased to be merely an input into the production process, a resource to be tapped by a
firm, or shared by similar firms in the same industrial cluster. Instead of locating where
other costs are lower or where agglomeration economies exist, skill-intensive firms must
also locate where they can access skilled labour. Instead of treating skilled labour as a
permanent stock of a place, firms must treat it as a flow, the amplitude of which varies
with qualities of place.
The firm has only had to consider the location preferences of skilled labour with the
advent of the post-industrial economy. Under early industrialization, the fixed nature
of transport networks (canals, seas, rivers) and power generation (canals, rivers) kept
production and producers close to these sources. With the advent of electricity, trans-
port, power and communication became less fixed to a specific place, but the sunk costs
of advanced industrialization were still high. Once large factories were established in
a place, they were hard to move and much less mobile compared with labour. Large
factory towns such as Hershey, Pennsylvania, were the embodiment of this firm-led
system. Here, the consumption preferences of workers were not only subservient to the
microeconomic demands of the firm, but the firm also controlled worker housing and
consumption. The development of industrial suburbs at the periphery of cities during the
late nineteenth century (Walker and Lewis, 2001) is another example of the industrial
firm’s primacy over the industrial worker.
Today, the skilled post-industrial worker enjoys more autonomy over where they live
because post-industrial production is relatively footloose. Firms can relocate offices,
studios and laboratories with greater ease than assembly plants. Communications
technology allows them to maintain multiple sites of production with much greater
ease than before, and to separate command and control functions that might once have
been centralized at one office. Most importantly, since skilled labour is a greater source
of competitive advantage and firm differentiation in this era, firms must bid for skilled
labour in order to gain competitive advantage. They do this in part by locating in places
that appeal to the lifestyle of high-human-capital individuals and reflect their values.
Research that sees industrial location as the leading determinant of economic growth
(for example, Storper and Scott, 2009) tends to overlook the ways in which the funda-
mental forces of economic growth are themselves subject to change.
The theories of technological generation identified in the first section see place as a


container for economic innovation and nothing more. The 3 Ts perspective sees inno-
vation as dependent on a series of forces that operate at the regional level. The talent
level of the local region – not just the local university or firm – is seen as an important
determinant of new firm formation and knowledge formation. The openness of a region
to this talent becomes an equally important characteristic, alongside the technological
production and innovation of the region’s industries.
This place-based perspective on innovation is useful in explaining why similar uni-
versities seem to have different effects on regional technological growth. Pittsburgh and
Boston, for instance, both have strong university bases, but they have different rates of
commercialization and different average regional incomes. Higher talent, technology
and tolerance scores for Boston suggest that the regional environment plays an impor-
tant role in absorbing and commercializing new knowledge creation.
It would be a mistake to see amenity-based human capital theories as being completely
blind to firm geography. The location decisions of human capital are determined by both
income and amenities in early human capital models (Glaeser et al., 2001; Clark et al.,
2002). In the 3 Ts approach, the ability to earn an income, or a higher income, is one of
many local features that determine a place’s talent-friendliness. Firm geography plays a
more significant role in the 3 Ts model than in other human capital models. Both of its
technology variables are based on industrial data, suggesting that places without con-
centrations of high-tech activity will not achieve significant levels of growth, regardless
of their other measures.
The 3 Ts model is also distinguished by its focus on tolerance, a more fundamental and
deeply rooted characteristic of place. It seeks to go beyond and go deeper than the pre-
vious focus on lifestyle, tastes and amenities. In fact, the very measures developed were
developed in response to the limited and at times non-systematic nature of data associ-
ated with amenity and lifestyle variables. Data on observed locational preferences of
artistic and cultural creatives, foreign-born people and gay and lesbian people is far more
systematic and unbiased. The experiential amenities identified by Terry Nichols Clark
and his collaborators are united by a specific aesthetic sensibility (Clark et al., 2002;
Florida, 2002a), which is not uniformly shared across all skilled workers (Markusen and
Schrock, 2006), and which might change with time. Likewise, the climactic, educational
and safety amenities identified by Glaeser (1994, 1998) are specific to skilled labour with
a particular set of lifestyle demands, and largely neglect cohorts such as the young and
childless. Rise sought to go beyond the limits of these variables and measures.
Thus, the third T – tolerance – is not simply an amenity compatible with lifestyles and
tastes, but a mechanism that can attract mobile labour. Inglehart’s work at the national
level (Welzel et al., 2003) has found a relationship between openness to outsiders and
economic performance. The 3 Ts approach has extended this established research into an
even more fundamental unit of economic activity. Even the life-stage amenities identified
by Florida in his later work are much more variable.
The 3 Ts model values racial diversity at a regional scale through its mosaic index. This
approach fails to capture that some regions that are relatively diverse at a regional level
are composed of socially homogeneous neighbourhoods that rarely interact. Certainly,
regions with high shares of segregated visible minorities and immigrants but also a high
degree of segregation do not accrue the same benefits from heterogeneity that regions
with integrated communities do, or signal low barriers to human capital in the same


way. When Rise was first published there was no measure of racial integration at the
sub-metropolitan scale, and numerous authors have pointed out this limitation (Thomas
and Darnton, 2006: Hansen and Niedomysl, 2009; Storper and Scott, 2009). This was
later updated when the paperback edition of Rise was published, with a new Integration
Index added to the tolerance measures (Florida, 2004), as well as by Høgni Hansen and
Thomas Niedomysl (2009), who formulated their own integration measure in their study
of Sweden’s creative class. The new measure gauges the degree of racial mix at the neigh-
bourhood scale of US metropolitan areas. The extent to which integration is positively
integrated to economic outcomes is not fully known, but according to recent research
there is at least some evidence that pockets of ethnic homogeneity persist in even the
most prosperous regions (Thomas and Darnton, 2006).
The 3 Ts approach departs most from human capital theory in challenging how
human capital is defined. Since Becker (1964), Mincer (1974) and Romer (1986), edu-
cational attainment has been the proxy for human capital. However, the 3 Ts approach
holds that knowledge is not the only cognitive resource that improves productivity.
Creativity, intelligence and intuition have also been found to be separate and important
sources of productivity growth (Smith et al., 1984), and are encountered separately from
formal education.
Florida’s ‘creative class’ defines human capital in occupational terms (as well as
educational ones) because occupation captures skills that are directly put to use by the
economy. His theory holds that while a region’s share of educated people may indicate
the supply of people who have acquired a threshold of skill, its share of creative workers
indicates a region’s demand for this skill. Resources that are not engaged in economic
activity will not by themselves be a part of the growth process. For instance, Saudi
Arabia’s large oil reserves are only relevant to its economic trajectory because the oil
there is extracted from the ground. If the country’s reserves could not – for whatever
reason – be mined from the ground, then its strength as an oil economy would be sig-
nificantly impaired. A large supply of skilled workers can, likewise, only be expected to
account for growth if the resource is absorbed and utilized by the local economy.
Another strength of the occupational measure is that it captures segments of the
labour force that did not acquire their skills in school. In some lines of work skills are
acquired informally on the job and not recognized by a formal, measurable credential.
The revolutionary and disruptive nature of entrepreneurial work often makes it incom-
patible with the proven lessons and established thinking that characterize university cur-
riculums. Recent research for Sweden estimates that while 90 per cent of degree holders
have a creative job, only 25 per cent of the creative class has a degree (Mellander, 2009).
THE GREAT CREATIVE CLASS DEBATE
It is an understatement to say that Rise instigated a robust debate. Science – as Thomas

Kuhn (1962) long ago noted – advances through challenge and debate. And the debate
over Rise has helped propel the field forward in important ways. The debate has evolved
across several dominant streams which we address below.
The first relates to how to define human capital. The 3 Ts theory challenged the edu-
cational definition for human capital, based on the notion that the absorptive capacity


for talent (captured by occupation) is more useful from the standpoint of economic
growth. The education and training definition of human capital had been pre-eminent
for economists going back to Becker (1964) and Mincer (1974), and heirs to this tradition
such as Glaeser (1994, 1998) resisted alternative frameworks, claiming that they added
no additional explanatory power. More recent critical work holds that human capital
is still paramount. Glaeser (2005) finds that the educational measure correlates with
regional population growth better than share of a region in the super-creative core or
the share of bohemian occupations. In other calculations, Stephen Rausch and Cynthia
Negrey (2006) find that the traditional measure of human capital correlates better with
their measure of gross municipal product when regional and state capital affects are
controlled for. In their analysis of German regions, Ron Boschma and Michael Fritsch
(2009) find that the effect of educational attainment on patenting is more significant than
the creative class, although both are significant. Yet other studies have pointed in other
directions. Charlotta Mellander and Florida’s study of Sweden (2009) finds that creative
class measures do a better job of accounting for wage levels. Gerard Marlet and Clemens
Van Woerkens (2004) conclude that for the Netherlands, their refined formulation of the
creative class outperforms educational attainment in accounting for job growth.
Which is better at accounting for regional growth, human capital or the creative class?
The most recent empirical evidence on the subject suggests that the answer depends on
how you define regional growth. Florida et al. (2008) compare human capital and the
creative class on how they accounted for metropolitan wage and income. They find that
human capital is more strongly associated with wages, while creative class is correlated
better with income. This result suggests that education and creativity act in different
ways to affect economic outcomes, even as the two measures correlate with one another.
Wage level is said to reflect a region’s overall productivity, while the income level is said
to reflect its overall wealth (Florida et al., 2008). Since both are important policy goals,
both clearly have a long-term place in the analysis of regional economic growth
Second, recent research has aimed to disaggregate the occupational groups contained
within the creative class, associations between the creative class and economic growth
notwithstanding. Some have criticized the creative class concept for being too broad
to develop policy around. Ann Markusen (2006) argues that the creative class groups
together people with drastically different lifestyles, mobility tendencies, political views
and amenity preferences, and that the ‘creative class’ writ large cannot be courted with
the same set of policies. Artists, for instance (Markusen and Schrock, 2006), appear to
be relatively more mobile, socially liberal and sensitive to price levels when compared to
other members of the creative class. The call to disaggregate the creative class is rooted,
partially, in the desire to establish understandings that will allow jurisdictions to more
directly enact policies to attract and retain members of the creative class.
Recent research has sought to distinguish creative class occupations from each other
by using the precise skills that each occupation demands (McGranahan and Wojan,
2007: Abel and Gabe, 2008; Asheim and Hansen, 2009). Asheim and Hansen (2009)
claim that the location preferences of creative types are affected by the predominant
knowledge bases required by local industry. They find that workers who require a syn-
thetic knowledge base tend to favour a better climate for business and industry, while
workers with analytical and symbolic knowledge bases tend to worry more about a
place’s ‘people climate’.


David McGranahan and Timothy Wojan (2007) use ONET, a database that assigns
various skill ratings to each occupation in order to remove occupations related to educa-
tion and health, which Florida did not have access to when doing the research for Rise.
This is an important, empirically grounded advance. It should be noted, however, that
the new ONET-based definition is closely correlated with the original one and subse-
quent research by Florida’s stream and others indicates that the updated definition does
not alter the key findings of the original research. Gabe and colleagues (2007) find that
– while wage returns to the creative class are only significant in metropolitan counties –
the returns to mathematical and technical skills are significant in both metropolitan and
non-metropolitan areas.
Florida et al. (2008) find that excluding education and health occupations does help
to achieve stronger growth relationships. They also find significant differences in how
various creative occupations impact regional development. For instance, they find that
educators and healthcare professionals are evenly distributed across the population
nationwide, and thus do not tend to affect regional productivity or wealth. Likewise,
artistic occupations, which tend traditionally to be thought of as non-traded industries,
are found to ‘exert considerable direct influence on regional development’ (Florida et al.,
2008). Occupations relate to computer science, management and engineering (Florida et
al., 2008) and producer services and information (Abel and Gabe, 2008) have also been
found to influence economic growth.
The third debate is concerned with the conditions that affect the distribution of human
capital and, ultimately, economic growth. Whether human capital is defined according
to an attainment or an occupational measure, it is assumed to flow to places that are
most suited to it. Prior to Rise, there was little theoretical consensus on which condi-
tions favour human capital agglomeration. Although numerous studies had hinted that
human capital co-located with consumer amenities, industrial clusters and universities, it
was unclear how the full complement of these factors worked to channel human capital.
The introduction of ‘tolerance’, as a new condition, has added to the list of variables
that can be analysed and empirically tested. And this has been an area of contentious
debate. Numerous studies have looked at the influence of tolerance on the distribution
of human capital, exploring whether the tolerance measures, as indicators of barriers to
human capital, are related to urban growth. The significance of the tolerance variable on
growth appears to vary depending on the specific independent and dependent variables
that are employed. Rausch and Negrey (2006) find that tolerance, and the Melting Pot
Index specifically, is more strongly related to gross municipal product than is the creative
class. Clark (2003) finds that the significance of tolerance only holds for large metropoli-
tan regions. Glaeser (2005) finds that the Gay Index is negatively related to US metro-
politan growth and that the Bohemian Index is not significantly related. Employing a
path analysis technique, Florida et al. (2008) are able to suggest a broader relationship
between tolerance, the concentration of human capital and regional outcomes (income
and wages). They conclude that tolerance is significantly and directly related to both
measures of the creative class, and both regional outcomes.
They find evidence that tolerance acts though human capital to promote regional
growth, but that it also acts on its own. How might tolerance work independently of
human capital to affect growth? The authors offer two additional mechanisms – each
supported by additional research.


First, a tolerant region is said to be necessarily more ripe for interaction and
positive spillovers. Bohemian workers are said to be highly mobile across indus-
tries and employers – allowing for them to transmit knowledge and best practices
(Vinodrai and Gertler, 2006; Markusen and Schrock, 2006; Currid, 2007). In addition,
a region that is more open to outsiders may house employees that are more open to
new co-workers. In keeping with this theme, they suggest that tolerant regions value
openness and self-expression, the same values that have been linked to economic
growth in studies at the national level (Welzel et al., 2003; Berggren and Elinder,
forthcoming).
These recent contributions to 3 Ts research have also found that consumer amenities
and the presence of a university are related to the location of both types of human capital
(Florida et al., 2008). This squares with another, even more recent finding. Alessandra
Faggian and Philip McCann (2006) find that the presence of a university does not explain
growth, once the presence of human capital has been controlled for. This suggests that
the university’s primary economic role is in attracting human capital to a region, and not
necessarily in spinning off or generating technological activity directly.
The revelation that all these conditions can simultaneously affect both human capital
and economic growth is perhaps the most important indication thus far that the region
is the primary organizing unit of post-industrial economic growth.
The 3 Ts framework has been most influential as an alternative method of accounting
for regional economic growth. In introducing a new variable for socio-economic differ-
ences, however, the theory has opened up research that seeks to grapple with increased
social polarization in advanced capitalist societies. A fourth genre of debate is concerned
with how differences at the occupational level correspond with distinct income, health
and wellbeing outcomes.
Florida discussed early findings on the relationship between occupational class and
income in Rise, finding that creative occupations earned dramatically higher annual
incomes than non-creative ones. Mary Donegan and Nichola Lowe (2008) studied the
relationship between a region’s creative class share and its wage polarization. Although
they conclude that ‘traditional’ institutional factors such as unionization and the
minimum wage are important mechanisms for easing inequality, the presence of the crea-
tive class outperforms all other variables in their correlation analysis.
The wide gulf in income between the creativity-oriented and routine-oriented classes
hints that the content of jobs might be a leading mechanism of social polarization.
Subsequent research has confirmed this hypothesis by analysing wage and income
returns to skills (Feser, 2003; Martin and Florida, 2009; Scott, 2009). A recent skills-
based analysis of North American occupations finds that earnings increase dramatically
as the level of analytical and social skills required by an occupation increase. Earnings
were found to increase by between US$24 000 and US$32 000 as the level of analytical
and social intelligence skills required by a job increased from the 25th to the 75th per-
centile. But earnings decreased as the physical skills required at a job went up. Members
of different occupations are not only rewarded differently, but the value of their skills
also varies. The growing disparity in regional incomes is another dimension of social
polarization, and recent work (Feser, 2003; Scott, 2009) has linked regional income to
the concentration of cognitive skills in metropolitan areas.
Commentary on the creative class thesis has also linked the consumption practices


of high-income workers to high levels of income inequality where creative workers are
found. By some accounts, creative workers are highly dependent on an underclass of
service workers, earning low wages to do tasks that creative workers do not have time
to perform on their own (Peck, 2005; Scott, 2006; McCann, 2007). The livelihoods of
these service workers, it is said, are further complicated by gentrification and displace-
ment processes which, by necessity, accompany the influx of wealth and capital to a city
(Peck, 2005: Scott, 2006; Atkinson and Easthope, 2009). In subsequent work, Florida
and colleagues have also noted the occupational and income polarization that seems to
accompany the creative economy (Florida, 2005; Martin and Florida, 2009). Viewing
wage polarization through an occupational lens, as these authors have done, might be
a useful step towards addressing the problem, since the challenge of changing occupa-
tional content is much more direct than the problem of ‘paying workers more’. Recently
Florida (2010; see also Martin and Florida, 2009) has speculated that a small cohort
of leading-edge service companies may be developing ways to increase the productive
output of traditionally low-paid service jobs by integrating the creative capabilities of
front-line workers into their business models. If service workers contribute more value to
their firms, then it should be possible to compensate them better as well. Future research
will no doubt examine if such efforts can moderate the social ‘bifurcations’ of the post-
industrial economy (Scott, 2006).
In the end the ongoing debate has been extremely fruitful and valuable. Florida always
says he learns the most from his critics: they spur him – and all of us – to think hard
about our assumptions, our constructs and our work. In the end, our understanding of
the social, economic and geographic world occurs through debate. We – all of us – stand
on the shoulder of giants. Our task is to move that understanding forward slowly and
gradually most of the time and much less frequently in great lurches. Our economy and
society have changed enormously over the past several decades, and just this sort of
debate is what advances our understanding. In this the greatest contribution of Rise is
the debate it has given rise to.
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3 The creative class paradigm

Richard Florida, Charlotta Mellander and Patrick Adler

THE CREATIVE CLASS APPROACH IN BRIEF

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WHERE RISE COMES FROM

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HUMAN CAPITAL THEORIES

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Research in regional economics began to link educational attainment (one measure of

THE CREATIVE CLASS APPROACH

THE ‘3 TS’ OF ECONOMIC DEVELOPMENT

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THE CENTRALITY OF PLACE

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THE GREAT CREATIVE CLASS DEBATE

It is an understatement to say that Rise instigated a robust debate. Science – as Thomas

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