A Composite Index of the Creative Economy

This article develops and presents a “Composite Indicator of the Creative Economy” (CICE). The CICE is a summary measure of an entity’s (e.g., a region’s) creative capacity or capability in three key dimensions: Innovation, Entrepreneurship and Openness. To develop the CICE we use an innovative method to determine the weights used to “add-up” the information contained in the data on the three dimensions. Our method – endogenous weighting – allows each entity (e.g., region) to have its own set of the weights, which are chosen to maximize the entity’s CICE score value. We use our endogenous weight methodology to benchmark the creative capacity of nine regions: Baden-Württemberg, Catalonia, Flanders, Lombardy, Maryland, Nord-Pas-De-Calais, Quebec, Rhône-Alpes, Scotland. Our analysis shows that Baden-Württemberg ranks highest in terms of creative capacity while Nord-Pas- De-Calais ranks lowest. Among the nine regions, Flanders ranks 3rd in creative capacity behind 2nd ranked Maryland. However, Flanders’ rank masks that its CICE score value is 25% below that of Baden-Württemberg and 11% below that of Maryland, indicating a non-trivial gap in creative capacity between Flanders and “best practice.”