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Education or Creativity: what matters most for economic performance?

  • E. Marrocu


  • R. Paci


There is a large consensus among social researchers on the positive role played by human capital on economic performances. The standard way to measure the human capital endowment is to consider the educational attainments by the resident population, usually the share of people with a university degree. Recently, Florida (2002) suggested a different measure of human capital - the “creative class” - based on the actual occupations of individuals in specific jobs like science, engineering, arts, culture, and entertainment. However, the empirical analyses carried out so far overlooked a serious measurement problem concerning the clear definition of the education and creativity components of human capital. This paper aims to disentangle this issue by proposing a disaggregation of human capital into three non- overlapping categories of creative graduates, bohemians and non creative graduates. Using a spatial error model to account for spatial dependence, we assess the concurrent effect of the human capital indicators on total factor productivity for 257 regions of EU27. Our results indicate that highly educated people working in creative occupations are the most relevant component in explaining production efficiency, non creative graduates exhibit a lower impact, while the bohemians do not show a significant effect on regional performance. Moreover, a significant influence is exerted by technological capital, cultural diversity and industrial and geographical characteristics, thus providing robust evidence that a highly educated, innovative, open and culturally diverse environment is becoming more and more central for productivity enhancements.

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Paper provided by Centre for North South Economic Research, University of Cagliari and Sassari, Sardinia in its series Working Paper CRENoS with number 201031.

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Date of creation: 2010
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Handle: RePEc:cns:cnscwp:201031
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