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Bohemians, Human Capital, and Regional Economic Growth

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  • Oliver Falck
  • Michael Fritsch
  • Stephan Heblich

Abstract

An emerging literature on the geography of bohemians argues that a region’s lifestyle and cultural amenities explain, at least partly, the unequal distribution of highly qualified people across space, which in turn, explains geographic disparities in economic growth. However, to date, there has been little or no empirical attempt to identify a causal relation. To identify the causal impact of bohemians on economic growth, we apply an instrumental variable approach using as an exogenous instrument the geographic distribution of bohemians prior to the Industrial Revolution in Germany. This distribution was primary the result of competition for prestige between courts and not of economic prosperity. Accordingly, the instrument is independent of today’s regional economic development. Focusing on the concentration of highly skilled people today that is explained by the proximity to exogenous concentrations of bohemians, the observed local average treatment effect supports the hypothesis of a positive impact of bohemians on regional economic development.

Suggested Citation

  • Oliver Falck & Michael Fritsch & Stephan Heblich, 2009. "Bohemians, Human Capital, and Regional Economic Growth," CESifo Working Paper Series 2715, CESifo Group Munich.
  • Handle: RePEc:ces:ceswps:_2715
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    References listed on IDEAS

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    Cited by:

    1. Carlino, Gerald & Kerr, William R., 2015. "Agglomeration and Innovation," Handbook of Regional and Urban Economics, Elsevier.
    2. Erik E. Lehmann & Nikolaus Seitz & Katharine Wirsching, 2017. "Smart finance for smart places to foster new venture creation," Economia e Politica Industriale: Journal of Industrial and Business Economics, Springer;Associazione Amici di Economia e Politica Industriale, vol. 44(1), pages 51-75, March.
    3. Franz, Peter, 2010. "Knowledge Spillovers as a Central Element in Theories about Knowledge-Based Regional Development: Advancement in Theory and Obstacles for Empirical Research," IWH Discussion Papers 5/2010, Halle Institute for Economic Research (IWH).
    4. Edward L. Glaeser & Sari Pekkala Kerr & William R. Kerr, 2015. "Entrepreneurship and Urban Growth: An Empirical Assessment with Historical Mines," The Review of Economics and Statistics, MIT Press, vol. 97(2), pages 498-520, May.
    5. Aaron Chatterji & Edward Glaeser & William Kerr, 2014. "Clusters of Entrepreneurship and Innovation," Innovation Policy and the Economy, University of Chicago Press, vol. 14(1), pages 129-166.
    6. Yu-Fu Chen & Michael Funke, 2010. "Booms, Recessions And Financial Turmoil: A Fresh Look At Investment Decisions Under Cyclical Uncertainty," Scottish Journal of Political Economy, Scottish Economic Society, vol. 57(s1), pages 290-317, July.
    7. Jan Wedemeier, 2011. "Creative professionals and high-skilled agents': Polarization of employment growth?," ERSA conference papers ersa11p489, European Regional Science Association.

    More about this item

    Keywords

    regional growth; human capital; bohemians; instrumental variables;

    JEL classification:

    • C31 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - Cross-Sectional Models; Spatial Models; Treatment Effect Models; Quantile Regressions; Social Interaction Models
    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
    • R11 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Regional Economic Activity: Growth, Development, Environmental Issues, and Changes

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