What’s leading economic growth in our cities?

Robert Litan, VP of Research and Policy at the Kaufmann Foundation* and director of Economic Studies at the Brookings Institution**, concludes that more of our growth today is generated by entrepreneurial or newer companies. He answers the following question in this interview from Smart City Radio:

Smart City Radio: “If you were advising a local urban leader on how he or she could encourage the start up of businesses that would have a good chance

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I first profiled Tryst back in 2003 as a popular coffeehouse third place in Adams Morgan, Washington DC. But five years later, ten years after it first opened, it’s not only become a neighborhood institution, but it really should be seen as a contemporary model for job creation.

Here’s the big picture:

1. A majority of big businesses come from small businesses, and small businesses are started by entrepreneurs… from their homes.
2. Many (not all) entrepreneurs who tried working exclusively

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If you’re looking to establish a beta community to crowdsource a natural cultural district (kudos to those of you who don’t have to click on the words to know what’s being talked about here), it starts with third places, events and scenes.

Third places. Most of you know what third places are - where you feel comfortable hanging out when you’re not at home or at work. A community starts with a third place so people can meet face to face, whether it’s a coffeehouse, a cafe/bookstore, or a

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Utilizing the Fifth Discipline principles of systems thinking, we bring to you a representation of why cities, especially their economic development departments that manage the largest of budgets, choose to invest in the outdated practice of landing ‘the big one’ rather than cultivating its own creative economy that is known to create jobs more effectively.

The Context:  First of all, it’s important to understand the long tail. The vertical axis in the graph to the left is economic output,

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Today’s entry will be a little uncommon, but rather extraordinary as we present Urban Cultures’ detailed presentation behind their Cultural Quarters: Necessary Conditions and Success Factors checklist. There really are few if any firms that have such fine-grain knowledge in helping cities invest in such places, and we’re glad to be associated with them.

The treatise follows:

An essential prerequisite for a vibrant cultural quarter is the presence of cultural activity, and this should include

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Continuing our understanding of natural cultural districts, here’s Urban Cultures’ (profiled previously) Necessary Conditions and Success Factors checklist for what makes a vibrant cultural quarter:

Activity
- Extent and variety of cultural venues
- Presence of an evening economy, including café culture
- Strength of small-firm economy, including creative businesses
- Access to universities and education providers
- Presence of festivals and events
- Availability of workspaces for artists

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‘cultural clusters’ and Tilburg in Holland).

The first two of these are oriented towards art as a good thing, an expression of civilization and of ‘cultural consumption’. The third is more closely related to urban-place making and mixed-use city diversity. The fourth is directly linked to the notion of the new economy and mixed media, and therefore the generation of new work, businesses and employment. However, there are many examples of planned cultural precincts that fail as urban

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...that is, unlike an unnatural one where most of the buildings are large-scale - designed, funded and run by city governments and corporations… and feel that way?

Continuing a look at the research of professor Mark Stern, profiled in the previous entry, natural cultural districts:

- rely on self-organized local players, organized from the bottom-up;
- are cultivated, as in economic gardening (a few examples listed here), not master-planned (this is where cities usually stop paying

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Maybe you should think twice about investing millions in that fancy new performing arts building to revitalize your city. While Richard Florida has long de-emphasized such large-scale investments, professor Mark Stern, Co-Director of the Urban Studies Program at the University of Pennsylvania provides a detailed answer below to the question, “Well then, now what?“

“While the arts are commerce, they revitalize cities not through their bottom-line but through their social role. The arts build

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Here’s one way to transform an industrial city like Buenos Aires, Argentina into a mecca for design and creativity, though this is definitely doing it the hard way…

Take one economic crash in 2001 where the peso’s (Argentian’s dollar) is devalued from 1:1 with every U.S. dollar to 1:3 with every U.S. dollar. Suddenly companies had to shed workforces in order to stay in business, forcing people out of secure jobs and without a means of finding new ones with companies unless they were to accept

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In science, the ‘edge of chaos’ is the region between order and complete randomness or chaos, where the complexity is maximal - where innovation and survival is most likely to take place. Then there is death or inanimate, where things are ‘frozen’.

The City of Littleton, Colorado, the founder of economic gardening, has pioneered research on the edge of chaos as it applies to cities and the three phases of life, to which organizations and economies naturally apply.

Frozen phase: “No

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...are some pretty desirable talents in establishing both a cultural and economic base for any city, but what has that got to do with Bozeman, MT and Asheville, NC?  A lot, thanks to an increasingly popular event known as Hatchfest.

Held annually in Bozeman since fall 2004 and for the first time in Asheville in spring 2008, students from around the world participate in competitions and exhibitions while being mentored by seasoned veterans already accomplished in the field, as the veterans go

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What better source than Fast Company magazine to list the fastest cities in 2007. Here’s their Fast Cities 2007, with category, city, population and primary reason it’s fast in its respective category:

Creative Class Meccas
Shanghai, China: 14.5M; investment
New York: 18.8M; income per capita
San Francisco Bay Area: 4.2M; technology
Buenos Aires, Argentina: 12.6M; university

Global Villages
Toronto, Canada: 5.1M; diversity/immigration
Johannesburg, South Africa: 3.3M; immigration
Berlin,

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Roubaix is a typical small city in Northern France that thrived in the industrial age from the 19th Century through most of the 20th Century, specializing in textiles. However, that economy crashed in the 1970s as the economy rapidly and mercilessly transitioned to the global information age. How did the city evolve?

The city still has a reputation for fashion and fabrics, but has diversified. For one, they transformed one of their textile manufacturing buildings into a contemporary indoor

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Based on part one of this two-part story, identifying the uneven distribution of extreme entrepreneurship and job growth in a few fortunate places that take advantage of innovation that is ubiquitous and portable, how can cities become more like one of those few fortunate places?

The answer, according to the Council on Competiveness in their comprehensive report, Where America Stands: Entrepreneurship, all of which are adopted by successful regions:

1. Creating Angel Networks. It not only

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Cities are constantly trying to get companies to move to their region, but what about growing their own (aka economic gardening) and supporting you? Here’s some compelling evidence on why that’s an increasingly popular trend:

A recent Small Business Administration study found that the most entrepreneurial regions in the U.S. had:

- 125% more employment growth
- 58% more wage growth
- 109% higher productivity than the least entrepreneurial regions
- spent 54% more on R&D and had 67% more

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As explained in the previous entry, much of what is built today is in ‘the big head’ of mass production rather than diverse niches of The Long Tail. However, in the internet age, companies focusing on both the Big Head (the mainstream ‘hits’) and the Long Tail (hundreds of niche favorites) are starting to eat the Big Heads for lunch - companies like Google, Netflix and eBay that pretty much cater to every niche, every personal interest you can think of.

In other words, we want a lot more

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“For too long we’ve been suffering the tyranny of lowest-common-denominator fare, subjected to brain-dead summer blockbusters and manufactured pop. Why? Economics. Many of our assumptions about popular taste are actually artifacts of poor supply-and-demand matching - a market response to inefficient distribution.“ Wired Magazine, The Long Tail, Oct. 2004.

Sound familiar when it comes to strip malls, subdivisions and office parks, which make up a vast majority of new real estate

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Many of us enjoy that college town feel of a pedestrian-oriented urban fabric, indie hang-outs and diversity mixed with enlightened conversation. Which cities do well in this regard, which don’t, and why?

Creative class economist Richard Florida provides some answers with his colleagues in their recently published, The University and the Creative Economy.

As far as statistics and rankings, the study introduces two new ones:
Brain Drain/Gain Index (BDGI) - measuring and ranking cities by the

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Need some inspiration for inner city job growth?  Want to know what the fastest growing inner city businesses are? Inc Magazine and Initiative for a Competitive Inner City provide an annual Inner City 100 list to answer just that. Inner cities here are defined as economically-challenged core urban areas excluding central business districts, and the candidates must be independent businesses.

The top ten, which seem to serve more than just the financial bottom line:

1. Commodity Sourcing

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The map above, from a Choices Magazine article, displays U.S. counties’ competitive share for college-educated population as a percent of total population over age 25 from 1970 to 2000 - in other words, brain gain vs. brain drain.

The accompanying study concluded, not surprisingly, that major metropolitan areas enjoyed a relatively large brain gain in every region while the nonmetropolitan, nonadjacent counties suffered brain drain. New England is an exception, with rural areas gaining

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Media economy - “an economy based on media, mass communication and services over mass-produced goods, no longer based on large, centralized companies. Instead, it flourishes amid a decentralized network of small businesses and entrepreneurs and the creative, urban places that support them.“

What better way to illustrate and understand how cities can compete in the information age than to co-publish a report with someone from the millennium generation, its emerging target market. CoolTown

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Food, shelter and clothing - our three basic needs. Notice however, how food comes first, but it’s rarely even on the list when it comes to building cities that attract people, or even specifically, the creative, entrepreneurial population that spurs job growth.

This graph, from CEOs for Cities’ City Vitals: New Measures of Success for Cities (full report for members here), is just a hint of innovative insight into understanding how food can, and should, play a much larger role in economic

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The table is from Linking the New Economy to the Livable Community, published by Collaborative Economics, sponsored by the James Irvine Foundation.

It clearly outlines how our one-size-fits-all mass production economy is evolving toward a customer-driven mass customization model based on choice, adaptability, distinctiveness, vital centers and quality of life, and even better, how communities will begin to reflect that.  You can also see why many of the unique, ‘customized’, human-scale

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It’s a simple question, and there are thousands of case studies.  One person who’s been researching the answers is Jasmin Aber, an architect leading research on culture-led regeneration with an international group of research specialists at the Institute of Urban Design & Regional Development at UC-Berkeley.

Why do cities shrink and grow?
Globalization.  Technological progress.  Educational progress. Aber states in a Smart City Radio interview, “At no other time in the history of capitalist

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