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Germany’s Creative Sector and its Impact on Employment Growth

A Theoretical and Empirical Approach to the Fuzzy Concept of Creativity: Richard Florida’s Arguments Reconsidered


Jan Wedemeier

The creative sector is considered to impact on employment and creative sector’s employment growth. Using a fixed effects model with time-lags, evidence is found that the creative sector fosters the growth rate of employment in German regions. Large shares of creative professionals lead to an increase in employment, but also reduce the growth rate of the creative sector. However, the growth rates are unequally distributed between the regions. Initially large shares of creative professionals further push the regional concentration of those professions in highly agglomerated regions. Driving forces for the concentration are specific characteristics, i.e. knowledge spillovers and cultural amenities. Moreover, for the evolution of the creative sector current policy strategies for the promotion of creative cities are presented.


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Part II.Germany’s creative sector and itsimpact on employment growth:Empirical analysis


Part II. Germany’s creative sector and its impact on employment growth: Empirical analysis 4. Hypotheses and research design Hypotheses are proposed explanations for empirical observations. Establishing hypotheses helps to determine what conclusions can be drawn from the empirical evidence. Naturally, caution has to be taken in the interpretation of data and its estimations. Keane (2010) argues that applied econometric models do not perfectly explain “true” correlations. The econometric models explain whether significant correlations exist, whereas economic the- ory and common sense help to specify the econometric models and to judge whether causalities exist (Keane 2010; Studemund 2006). After all, the hypotheses determine how useful the results are for policy evaluation (Keane 2010), and “what we can learn about the real world from a sample” (Studemund 2006, 112). In this chapter, the research questions presented in section 1.1 are narrowed down and refined into hypotheses. Furthermore, the decision rules for accepting or rejecting the hypotheses are presented. I further contribute to the question of how the empirical research was carried out, by explaining the research’s design. Most important, the final definition of the creative sector used in the work is highlighted. Naturally, the chapter 4 closes with a summary. 4.1. Main hypotheses To structure the empirical analysis, I start with the main hypotheses. The econometric work seeks to shed light on the creative sector (research question 1) and on diversity (research question 2). The creative sector and diversity are supposed to contribute to economic growth and, furthermore, both...

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