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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 IV.A final overview


Part IV. A final overview 8. Conclusions In this thesis the impact of the creative sector on employment growth in German regions from 1977 to 2004 is investigated. This sector was highly dynamic in the last decades and is currently much debated in economic research. It is furthermore one of the recent important topics in regional and city planning. However, the work has been specifically concerned with the creative sector’s impact on total employment growth and group specific employment growth, i.e. the growth of employment in the creative sector. The assumption is that employment pooling in the creative sector might result in the further accumulation of employment in the creative sector. This assumption proves to be a self-reinforcing process. Before the empirical investigation into this research question, I introduced and developed a model of the creative city based on Suedekum (2006, 2008). This model was to explain the above employment effect on the creative sector, including the circular effect of cultural amenities (i.e. centripetal forces). This model of the creative city helps to interpret the direction and logic of the empirical results. However, the main result of this research is the following: I find robust evidence for the positive influence of the creative sector that fosters the regional growth rate of total employment. The presence of large shares of creative professionals lead to an increase in total employment, but reduce the growth rate of the same employment group. The growth in total employment overwhelms the...

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