How Arts and Culture Add to City Economies

From The Atlantic City Lab: 

A new study published in Economic Development Quarterly finds that the arts do in fact add to urban economies overall. To get at this, the authors—the noted urban real estate specialist Arthur Nelson and several colleagues—employ a unique data set on professional performing arts organizations (which I have lightheartedly referred to as the “SOBs” of the symphony, opera, and ballet) with annual budgets of over $2 million.

Using this data, the study looks at the change in knowledge-class workers (defined similarly to the creative class) between 2000 and 2010 for some 350 U.S. metro areas. Its statistical analysis controls for a wide variety of other factors that might be thought to affect the growth in knowledge or creative class employment, including overall employment change, population, density, housing values, the share of college grads, race, the share of the population that is foreign-born, and natural amenities like climate and terrain, among others.

The study finds substantial evidence that performing arts organizations add to both the growth of the knowledge class and to urban economies broadly. Those with just one type of performing arts center saw a 1.1 percent increase in knowledge-class employment between 2000 and 2010; those with two types of performing arts centers saw a 1.5 percent increase; and those with all three types saw a 2.2 percent increase. The study notes that, while this may seem like modest growth, the numbers add up. Over this ten-year period, the 118 metros with at least one performing arts organization generated a whopping $60 billion in annual income and more than half a million additional knowledge-class jobs, or over 12 percent of all knowledge-class jobs created over that time frame.