The creative class or human capital? : Explaining regional development in Sweden

Jacobs (1961, 1969) emphasized the role of cities and regions in the transfer and diffusion of knowledge; as the scale and diversity of cities increase, so do the connections between economic actors that result in the generation of new ideas and innovations. [...] The model also enables identification of regional cultural and institutional factors namely, the university, amenities and service diversity, and tolerance as they affect the geographic distribution of talent in the first place. [...] Moreover, the relative importance of the parameters is expressed by the standardized path coefficients, which allow for interpretation of the direct as well as the indirect effects. [...] The models examine the effects of the various measures of talent on technology and regional development and also isolate the effects of three key factors universities, service diversity, and tolerance on the level and geographic distribution of talent. [...] Looking at the factors that are associated with the creative class, the coefficients for the university and service diversity are positive and significant, while the coefficient for tolerance is not.