Frostbelt Diversity Since 1975 In1975: Cleveland, Detroit, NYC and - - PowerPoint PPT Presentation

Frostbelt Diversity Since 1975

• In1975: Cleveland, Detroit, NYC and

Boston all were in trouble

– Today the first two are still troubled; the second two look like big success

• Increasing tendency of successful, older or

colder, cities to specialize in idea-oriented industries.

– Centralization of high h.c. industries (Glaeser and Kahn, 2001)

Skills and Growth in the Cold

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Figure 5

1980 Share of Skilled Workers Change Income 1980-2000 Fitted values .02 .04 .06 .08 .1 .2 .4 .6

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.05 .1 Change in Percent with BA 1990-2000 .1 .2 .3 .4 .5 Percent of Adults with BA Degree in 1990

Innovation, Entrepreneurship and City Success

• Entrepreneurship lies behind this skills-

success connection.

• Skilled people are more likely to become

successful entrepreneurs.

• They are also more likely to hire other

more skilled people.

• The turnaround of some older, colder

cities owes much to entrepreneurship.

Figure 2 - Self Employment and Income by Education

Percent Self Employed Percent Self Employed Earning over $110,000 Annually

0% 5% 10% 15% 20% 25% 30% No High School Some High School High School Graduate Some College College Graduate or Higher Education Percent

Figure 10

Change in Patents 1990-2000 Change in Income 1990-2000 Fitted values

• 1

1 2

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Akron, O Albany-S Albuquer Allentow Atlanta- Austin-R Bakersfi Baltimor Baton Ro Birmingh Boston-Q Buffalo- Charlest Charlott Chicago- Cincinna Clevelan Colorado Columbia Columbus Dallas-P Dayton, Detroit- El Paso, Fort Lau Fort Wor Fresno, Gary, IN Grand Ra Greensbo Greenvil Harrisbu Hartford Honolulu Houston- Indianap Jacksonv Kansas C Knoxvill Lake Cou Las Vega Little R Los Ange Louisvil Madison, Memphis, Milwauke Minneapo Nashvill Nassau-S New Have New Orle New York Newark-U Oakland- Oklahoma Omaha-Co Orlando, Oxnard-T Philadel Phoenix- Pittsbur Portland Poughkee Providen Raleigh- Richmond Riversid Rocheste Sacramen Salt Lak San Anto San Dieg San Fran San Jose Sarasota Scranton Seattle- Springfi

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Self Employment Rate Log Avg Firm Size 1977 . .05 .1 2.2 2.4 2.6 2.8 3

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Figure 5

Employment Growth and Average Firm Size

Average Firm Size - 1977 Employment Growth 1977-2000 Fitted values 2.2 2.4 2.6 2.8 3 .5 1 1.5

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Figure 1: Pop Growth and Initial Self Employment Rate

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970-2000 Fitted values .2 .4 .6

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Attracting and Facilitating Skilled Entrepreneurs

• The Inability to Predict Innovative Success
• Attracting and creating potential

entrepreneurs.

– Quality of life strategies (schools, crime) – Limiting taxes and redistribution

• Eliminating roadblocks to their innovation.
• Creating infrastructure for success

– Legal and physical