Cultural and Creative Cities and Regional Economic Efficiency: Context Conditions as Catalyzers of Cultural Vibrancy and Creative Economy

Abstract

Following the hype that has been given to culture and creativity as triggers and enhancers of local economic performance in the last 20 years, this work originally contributes to the literature with the objective of assessing the impact of cultural and creative cities (CCCs) on the economic output of their regions. In this sense, the cultural and creative character of cities is considered a strategic strength and opportunity that can spillover, favoring the economic system of the entire regions in which the cities are located. Through an innovative methodology that exploits a regional production function estimated by a panel fixed effects model, the effect of cities’ cultural vibrancy and creative economy on the output of their regions is econometrically explored. The data source is the Cultural and Creative Cities Monitor (CCCM) provided by the JRC, which also allows the investigation of the possible role played by the enabling environment in catalyzing the action of cultural vibrancy and creative economy. The results are thoroughly examined: especially through cultural vibrancy, CCCs strategically support the output of their region. This is particularly the case when local context conditions—such as human capital and education, openness, tolerance and trust, and quality of governance—catalyze their effect. Overall, CCCs contribute to feeding a long-term self-supporting system, interpreted according to a holistic conception that includes economic, social, cultural, and environmental domains.

1. Introduction

The last twenty years have witnessed a continuous growth in the research aimed at establishing, understanding, and discussing the role of cultural heritage and creativity in favoring (local) development.

On the one hand, cultural heritage in historic environments has been seen as an enhancer of livability and resilience [1] as well as a contributor to sustainable development [2] and overall economic growth [1]. On the other hand, creativity has been recognized as a major driver of economic performance as well (e.g., [3,4,5]).

Overall, cultural heritage and creativity are in fact linked together and to development, especially at the territorial level, where the importance of local history and the role of communities have been emphasized from many parts [6,7,8].

Within this general framework, features related to cultural heritage and creativity have been widely associated with the urban environment (e.g., [9,10,11,12,13]). Cities are indeed also centers of knowledge, and they encourage creative thinking and innovation through facilitating interaction and knowledge spillovers. The agglomerated nature of cultural and creative characteristics, in fact, is also associated with the advantages linked to urban efficiency (through the attraction of people and production factors and higher productivity). In other words, the presence of a cultural and creative city could be reasonably expected to trigger so-called trickle-down effects from core to peripheral areas and therefore generate wider repercussions (spillovers) from the city to the broader region it belongs to.

Despite the availability of some empirical literature on the relationship between cultural heritage and development on the one hand (see for instance [14,15,16,17,18,19]) and the much wider array of quantitative works on creativity and development on the other (see for instance [13,20,21,22,23,24,25,26,27,28,29]), the overall framework described above led us to wonder if there are some common cultural/creative/environmental characteristics of cultural and creative cities (CCCs) that more than others reinforce the spillover effects from the urban environment, thus favoring the economic output of the whole region hosting the city.

As per our knowledge, this is the first empirical attempt to assess the strength of cultural and creative cities’ positive spillovers towards the wider regional economy. What is usually done, in fact, is to estimate the urban/regional effects of cultural and creative elements on urban/regional growth using the same geographical scope for both dependent and independent variables. We do, instead, focus on the effects of urban variables on the regional output, which allows to assess the strength of the potential cultural and creative spillovers on the whole region.

In addition, this work originally addresses the role of context conditions in catalyzing and/or reinforcing the impact of the cultural/creative urban features. This is methodologically and empirically carried out through a regional production function, augmented for taking urban cultural, creative, and environmental features into account.

The objective of this study is therefore twofold: evaluating the regional economic spillovers stemming from urban cultural and creative features and exploring the role of territorial conditions in favoring this process. In fact, the goals this paper tries to achieve can be specified in two subsequent steps:

What (if any) are the cultural and creative spillover effects through which CCCs enhance the output of their regions?

Are such effects potentially triggered or reinforced (catalyzed) by the presence of specific context conditions?

To address these questions, the paper is structured as follows. Firstly, we present a literature review of the role of CCCs in the development of their regions and on the potential importance of context conditions in catalyzing their impact (Section 2). We then provide a thorough illustration of the data source, i.e., Cultural and Creative Cities Monitor (CCCM) database (Section 3). This is followed by the econometric investigation of the impact of the cultural and creative features of CCCs on their regional economies through a regional production function, which is also augmented to take the potential catalyzing effect of context conditions into account (Section 4). Subsequently, the results are presented (Section 5) and discussed (Section 6). Finally, conclusions are provided, together with some suggestions on possible future research lines about this topic (Section 7).

2. Literature Review

2.1. The Role of Cultural and Creative Cities in the Development of Their Region

The paramount relevance of culture and creativity for individuals, communities, and countries has been increasingly recognized during the past two decades and its powerful role as a resource for the enhancement of cultural, social, environmental, and economic local conditions has been widely acknowledged (see for instance [30]).

In particular, different and multifaceted mechanisms through which the positive effects of culture and creativity can spill over to a broader audience of people, industries, and territories have been identified, and in fact, the European Commission officially highlighted the existence and the importance of cultural and creative spillovers for the first time in 2012 [31]: being at the crossroads between arts, business, and technology, indeed, cultural and creative sectors are in a strategic position to trigger spillovers. Such cultural and creative spillovers can be defined as “the process by which activity in the arts, culture and creative industries has a subsequent broader impact on places, society or the economy through the overflow of concepts, ideas, skills, knowledge and different types of capital” [32].

As Lazzaro [33] in a recent and comprehensive review, points out, a spillover approach is especially convenient in disentangling the positive effects of the arts and culture, and it is a useful way to address the issue of capturing the overall value that art, culture, and creativity generate in the economy and the society. The author highlights, among other elements, input–output knowledge transfer effects from the Cultural and Creative Industries (CCIs) to the rest of the economy [34] and taste acquisition and consequent increasing demand for cultural activities not only in the municipality that originally spent resources on cultural policies but also in surrounding areas [35]. In addition, Sacco [36] applied the conceptual framework of cultural spillovers to active cultural participation and the access of individuals. In particular, the author identifies eight channels, namely innovation, cultural welfare, (social) sustainability, social cohesion, new entrepreneurial models, lifelong learning, soft power, and local identity. In fact, individuals can expand their capacity of expression, review their expectations and beliefs, and reshape their own social identity.

According to this perspective, although culture and creativity mostly find their greatest and considerable expressions within cities (e.g., [9,10,11,12,13]), we put forward the idea that economic benefits stemming from cultural and creative environments cross the urban boundaries and spill over to the whole region to which each city belongs. Adopting the same classification proposed in the Cultural and Creative Cities Monitor (CCCM), we argue that the urban characters named cultural vibrancy and creative economy contribute to enhancing and favoring the economic conditions of the regions hosting the cultural and creative cities. In fact, even though new ideas and insights sharing tend to happen in cities, positive economic consequences involve the related regions as well [37].

In more detail, we do expect this to happen potentially through different channels, as explained in what follows.

Cultural vibrancy can be intended as evidence of creating, disseminating, validating, and supporting arts and culture as a dimension of everyday life in communities [38], and it is expressed through the presence and attractiveness of cultural venues and facilities [39]. Its impact on regional economies can be discussed as part of a growing literature that focuses, from different perspectives, on the economic consequences deriving from culture and cultural heritage (see, for instance, [40,41]) on cultural heritage as a production factor, [42]) for a review on the economic impacts of cultural heritage, and [43] on the different instrumental roles played by heritage in economic development). As argued in Throsby’s seminal work [44], culture and cultural heritage form the so-called cultural capital. Being a type of capital just like physical, human, and natural ones, cultural capital gives rise to a flow of goods and services, it is part of an economic ecosystem, and it is able to influence economic activities.

The cultural vibrancy character of cities can be encompassed by the concept of cultural capital [39] and, as such, interacts with local economies in several ways. The presence of cultural heritage and cultural facilities activates and stimulates a bundle of activities and services linked to the culture-related value chain (e.g., construction, archaeology, advertising and marketing, retail, and tourism [45]. As for tourism, it has been studied widely in relation to local development [46], with city branding as an important tool in its promotion [47,48]. Thanks to a relatively good data availability, the relationship between cultural heritage and tourism has been also investigated from an empirical perspective (e.g., [17,18,49,50,51]).

From another point of view, the idea of the existence of a heritage ecosystem supports the understanding of the synergies and interrelations between cultural heritage and cultural facilities with other connected sectors [52]. These synergies influence employment, turnover, and value added that can be treated as measures of the economic impact of the presence of tangible forms of culture.

Furthermore, cultural vibrancy can be associated with other socio-cultural and psychological effects that, despite their non-economic nature, might lead to economic consequences. Heritage, cultural facilities and cultural participation inspire creativity [53], and they enhance local identity, sense of belonging, pride in local culture and social traditions [54,55], and individuals’ and communities’ well-being [31]. As argued by Wilson et al. [56], cultural heritage and cultural engagement are sources of togetherness, cultural democracy, and cultural freedom. Participation in culture increases the possibilities of self-expression, learning transferrable skills, and feeling part of a community. Overall, cultural heritage and cultural engagement help developing societal traits, relations, and ways of life that, as peculiar and place-specific characteristics, influence the functioning of local economic dynamics. Shared systems of meaning, the recognition of common interests, and increased well-being contribute to shaping the ways in which economic activities are performed.

On the other hand, the so-called creative economy fully takes part in the urban economic fabric, also as an overlap between cultural and commercial activities and as a contributor to the creation of a fertile atmosphere for innovation, talents, and investments attractiveness and international competitiveness [57,58]. Besides representing business economic entities that make money and profit [59] and directly stimulate other economic activities, creative industries are typically characterized by entrepreneurial spirit, flexibility, and rapid learning capacity [60]. Entrepreneurship, flexibility, and innovation trigger the ability to face changing markets and enhance the economic progress.

As argued in [61], the creative economy, besides facilitating the demand for novelty, provides the essential evolutionary services such as know-how, mindsets, and technologies. In addition, the positive contribution of creativity on economic development has been broadly highlighted in the existing literature, even in empirical terms. Creativity, in fact, favors the generation of new, original, and innovative ideas and, through this mechanism, positively affects economic development (see, for a review, [62]).

Within this general framework, features related to cultural heritage and creativity have been widely associated with the urban environment, according to the idea that culture mainly belongs to and creativity basically germinates in relatively rich and educated areas, thus in a context that is also linked to urbanization and agglomeration economies (see also [63,64,65]).

The peculiar interest in CCCs has been made even higher by the New Urban Agenda [66], which highlights the importance of vibrant, sustainable, and inclusive urban economies, building on local resources, competitive advantages, and cultural heritage. The NUA also calls for the sustaining and supporting of urban economies through the promotion of cultural and creative industries, sustainable tourism, the performing arts, and heritage conservation activities.

Building on what was explained above, the present work hypothesizes a potential positive impact of urban cultural and creative characteristics on the output of the whole region, when favorable effects are so strong to spill over the urban boundaries.

In fact, urban cultural vibrancy and creative economy are expected to stimulate an economic ecosystem, generating socio-cultural spillovers [36], whose impact is not limited to the city itself but spreads to the whole region.

Interactions do indeed exist between the urban cultural and creative features and the hosting region: economic networks, fostered competitiveness, increased attractiveness, and widespread innovation all contribute to such an intense interplay. Furthermore, the presence and development of creative industries together with culture and amenities attract creative knowledge workers that, by acting locally and networking globally, stimulate urban and regional competitiveness [13,59,67].

2.2. The Importance of Context Conditions in Catalyzing the Impact of CCCs

Following the reasoning presented so far, the cultural and creative character of cities can be treated as a strategic strength and opportunity that favors the economic system of the regions in which the cities are located. However, though characterized by the common trait of being distinctly cultural and creative, CCCs present different, peculiar, and specific features in terms of local and context conditions. More specifically, each city is embedded in a particular environment that encompasses both material and non-material assets; sets of private, public, and collective resources; and cognitive, social, and relational traits. These elements include production factors such as culture, histories, institutional structures, relational, and social capital and constitute and shape the so-called territorial capital on which the competitiveness potential of areas is built [68,69,70,71,72].

All these intangible elements influence the mindsets, attitudes, and ways in which economic activities are performed. Capello and Perucca [73], for instance, stress how the impact of cultural capital on local economic performance is not place-neutral. Rather, it depends on the specific and particular intangible context conditions. Following this perspective, we put forward the idea that the role that urban cultural vibrancy and creative economy play in regional economies is not neutral to the place-specific, intangible, context conditions of the city itself. To deepen this reasoning, we exploit the information provided by the CCCM in terms of the enabling environment, which includes several context features such as human capital and education; openness, tolerance, and trust; local and international connections; and quality of governance.

Human capital and local and international connections have been widely recognized by the literature for their substantial role in influencing economies. In fact, since Lucas [74] in the economic literature (and even earlier in sociology and human geography), human capital started to be included as one of the determinant factors of output and productivity, and, in an increasingly developed knowledge-based economy [75], its relevance as a crucial factor for economic growth has been largely confirmed by theoretical and empirical evidence (see, for instance, [76]). Local and international connections have also been considered as relevant factors influencing economies by enabling accessibility; mobility; circulation of people, goods, and information; creation of networked economy; and diffusion of economic spillovers [77,78,79,80].

As well explained by Camagni et al. [54], if, on the one hand, the economic role of human capital and local infrastructures belongs to a long tradition of supply-based explanations of economic performance, on the other hand, additional and more intangible context-related factors such as openness, tolerance, trust, and quality of governance are also recognized as drivers of economic competitiveness by a literature focused on endogenous development. In fact, social and relational systems built by communities through norms, trust, and networks shape economic behaviors and support economic efficiency by facilitating interactions, cooperation, and coordination fed by the awareness of mutual benefits [81,82]. Territorial intangible features such as trust, relational and social capital, and openness strongly interact with institutions by being both the source and results of the local quality of governance. Institutions represent the ‘rules of the game’ that sustain, regulate, and allow the functioning of the economic systems [83,84]. Synergies and interactions between community cultural traits and institutions turn out to be of the greatest importance for endogenous place-based development [85]. In addition, the quality of governance favors the accumulation of material public goods, including cultural and natural resources.

Moving forward into this place-based perspective, cultural and creative cities are located in heterogeneous environments, each of which is characterized by specific idiosyncratic characteristics. Urban cultural vibrancy and creative economy interact with these context-related elements and act synergistically in their influence on regional economies. More specifically, we argue that, encompassing human capital; connections; openness, tolerance, and trust; and quality of governance, the so-called enabling conditions trigger, enhance, and catalyze the role that cultural vibrancy and creative economy play in the economic performance of the regions CCCs belong to. A highly educated environment might favor the appreciation and recognition of the value of both cultural vibrancy and cultural economy, consequently promoting the spillover of the economic benefits for the regional output. Interconnections and well-developed transportation infrastructure facilitate accessibility and mobility, therefore supporting wider participation in cultural vibrancy and easier dissemination of advantages stemming from creative economy. Openness, tolerance, and trust provide a favorable environment for local development and high-quality institutions, granting the availability of a favorable context and suitable policies for the flourishing of both cultural vibrancy and creative economy and their consequent regional economic spillovers.

3. The Cultural and Creative Cities Monitor Database

Culture and creativity are multifaceted, complex, and multidimensional concepts. Therefore, they are particularly difficult to define and delineate. When dealing with them by adopting an economic–quantitative approach, one of the main issues is related to data availability and collection. As highlighted in [86], and especially true for culture and cultural heritage, the available cultural statistics in Europe suffer from several issues such as measurement problems, lack of univocal, consistent, and comparable data, and scarce or no political priority. Consequently, precise and rigorous identification of the impact that culture and creativity have on economies continues to be a difficult result to achieve. However, displaying the beneficial economic role played by culture and creativity is of fundamental importance to increase the attention of policymakers to these fields, allow the monitoring of the results of cultural/creative projects, and share best practices.

For this work, we have exploited data provided by the Cultural and Creative Cities Monitor (CCCM). Launched in 2017 by the Joint Research Centre (JRC) and replicated and improved in 2019, the CCCM project takes a step forward in the direction of developing a database with consistent, comparable, and reliable cultural and creative statistics. The database includes 190 cities selected for their cultural and creative character based on their commitment to the promotion of culture and creativity. Their engagement (and consequent inclusion in the sample) is proven by their designation as either European Capital of Culture or UNESCO Creative City or the hosting of festivals labeled with the “Europe for Festivals, Festivals for Europe (EFFE)” title.

For each included city, the CCCM database provides an overall synthetic indicator (score), which results from several (29) sub-indicators, grouped into three main components of a city’s cultural and socio-economic vitality: cultural vibrancy, creative economy, and enabling environment. As explained in the report provided by the JRC [87] in association with the database, cultural vibrancy measures the urban cultural vitality by evaluating both tangible manifestations of culture and cultural participation. Creative economy indicates the contribution in terms of jobs creation, employment, and innovative skills of the creative and cultural sectors, and enabling environment measures tangible and intangible characteristics of a city that support the creation of a livable, vibrant environment and the attractiveness of cultural and creative activities and talents (for a detailed description of the indicators, see also [88]). Figure 1 summarizes the three main components, together with the included sub-dimensions.

Cultural vibrancy consists of both cultural venues and facilities (including sights and landmarks, museums, cinema seats, concerts and shows, and theatres) and cultural participation and attractiveness (comprising tourist overnight stays, museums visitors, cinema attendance, and satisfaction with cultural facilities). Whilst the first dimension is more related to the sheer presence of tangible manifestations of culture regardless of the involvement of visitors, the second one encompasses the “activation” of cultural sights through engagement and participation of tourists, visitors, and spectators.

Creative economy includes both the total stock of creative and knowledge-based jobs and the newly created ones (measured as jobs in arts, culture and entertainment, media and communication, and other creative sectors) together with intellectual property and innovation (ICT patents applications and community design applications). As highlighted by Banks et al. [89], cultural industries display and adopt peculiar organization and working practices led by risks, volatile markets, and constant transformations that characterize their areas of business. By including creative and knowledge-based jobs, this composite indicator encompasses the potential of the city to learn and to be flexible, creative, and idea-driven. Furthermore, intellectual property and innovation capture the ability of the city to produce new and innovative knowledge and to acquire transformational power.

Enabling environment is a multifaceted indicator that includes several territorial assets potentially able to enhance the cultural and creative characters of cities as well as catalyze their economic benefits. Human capital and education in terms of graduates in arts and humanities, graduates in ICT, and the average appearance in university rankings express both the presence in the city of a substantial body of cultural, creative, and innovative class of graduates as well as the quality of the educational institutions and the consequent attractiveness of the city. Openness, tolerance, and trust (measured as a composite indicator considering foreign graduates, foreign-born population, tolerance towards foreigners, integration of foreigners, and people’s trust) estimate the urban ability to welcome, integrate, and place confidence in others. Local and international connections evaluated in terms of passenger flights, potential road accessibility, and direct trains to other cities represent the accessibility of the city and the simplicity and quickness of interconnections to and from the city. Quality of governance involves the capacity to provide favorable institutional quality and suitable policies.

As previously highlighted, our interest lies in detecting the potential positive economic spillovers (possibly catalyzed by the material and intangible context conditions) of cultural and creative cities on the regions in which they are located. We thus needed to collect regional data besides the urban ones. Therefore, drawing on the CCCM database, each city has been associated with its corresponding region (according to the Eurostat Nomenclature of Territorial Units for Statistics, regions represent the second level, and therefore each city has been associated with its NUTS2 region). However, following the Eurostat classification, a few cities do represent an entire NUTS2 region (the cities are Wien, Prague, Berlin, Hamburg, and London. London is further divided into five NUTS2 regions; therefore, all five regions have been considered, plus all the adjacent regions). For those specific cases, we associated the city with all the adjacent regions besides the region corresponding to the city itself, in order to be able to catch the impact of the cultural and creative features of the city—potentially triggered and/or reinforced by local characteristics—on the surrounding area. Figure 2 exemplifies the criteria of association in two different cases: (a) the standard association of the city to the region of belonging; (b) the association of the city to adjacent regions (in some cases, there is more than one CCC in the same NUTS2 region. As a robustness check, all the regressions presented in the following sections were also run randomly keeping only one CCC for each of the NUTS2 region for which the case occurs. The results are substantially the same for all the specifications).

Based on what was explained above, we elaborated an empirical analysis to investigate the spillover effects CCCs may have on their regions. The model and the data are thoroughly presented in the following section.

4. Methodology: The Impact of Cultural and Creative Cities on Their Regional Economies

This section is dedicated to presenting the adopted empirical model.

The objective of this work is to quantitatively test whether and which cultural and creative characteristics of CCCs are strong enough to generate spillover effects that enhance the output of the whole regions they belong to and under which specific context conditions.

This is, in fact, one of the main innovative contributions of the present work. What is usually done, indeed, is to estimate urban or regional growth functions, exploiting the same geographical scope for both dependent and independent variables. In this sense, our analysis differs from what is traditionally carried out since it relies on a production function approach, using urban characteristics to explain regional output. Differently from other approaches, this allows the capturing of the potential cultural and creative spillover effects from CCCs to the whole region they belong to, therefore providing an original contribution to the existing literature.

This strategy draws on a traditional approach to the measurement of the role of agglomeration economies (urban efficiency), typically based on the estimation of an aggregate Cobb–Douglas urban production function (see, for instance, [90,91]).

According to this long-established method, the city’s output is basically a function of its capital stock, its employment (also including elements related to the quality of labor), and its size, which is interpreted as urban efficiency gains.

In the present work, we depart from the traditional approach, exploiting a methodology innovatively used for quantifying the effect of urban agglomeration economies on regional output [92] and here originally adapted to focus on cultural and creative urban spillover effects.

The present work, in fact, does measure the effect of cultural and creative urban efficiency on regional GDP, through a regional production function that includes capital stock and employment measured at the regional (NUTS2) level. In this case, the results obtained depict the cultural and creative urban efficiency effect on regional output where cities are located, rather than merely on the output of the cities themselves. The efficiency gains of a metropolitan area, in fact, are not expected to remain confined within the geographical and/or administrative boundaries of the city but to spread around the surrounding areas. As per our knowledge, this is the first attempt to quantify urban cultural and creative spillover effects in general and through the use of this kind of methodology in particular.

Although the regions included in the sample clearly differ in terms of several structural characteristics, we preferred not to focus on specific cases to obtain an average overall effect that can convey a general message.

More specifically, a Cobb–Douglas regional production function in which Gross Domestic Product is a function of capital (K) and labor (L, both in terms of quantity and quality) is at the basis of the empirical analysis. This methodology allows to investigate the efficiency with which the production factors translate into regional output. Besides the standard determinants of production, the cultural and creative characteristics (CC) of the CCCs have been added to the function as they are expected to represent relevant factors influencing regional GDP through suitable spillover effects (see Section 2.1). A production function is therefore estimated. The dependent variable is the level of output, determined by the traditional production factors, capital, and labor. The equation is augmented to include the specific urban features of interest. This is different from a regional growth model, which would include additional regional characteristics meant to explain regional development over a certain period. The formal model underlying the analysis can be written as follows:

GDP_r = f(K_r, L_r, CC_c)

where r stands for regional and c stands for urban factors. The units of analysis are 186 cultural and creative cities included in the Cultural and Creative Cities Monitor database in two different periods of time, resulting in a total of 372 observations (the Swiss cities have been excluded from the analysis because of the impossibility to gather the corresponding regional data for the variables of interest.).

Stemming from the general production function, the first assumption to be tested relates to the potential beneficial role of urban cultural vibrancy on regional output and the exploration of the role of each single component of it (cultural venues and facilities; cultural participation and attractiveness). Since we have balanced individual observations for two periods, the model was estimated as panel fixed effects. The following equations formalize the assumption:

$$\begin{array}{l}lnGD{P}_{rt}=\alpha +{\beta }_{1}ln{K}_{r\left(t-3\right)}+{\beta }_{2}lnLquantit{y}_{r\left(t-3\right)}+{\beta }_{3}lnLqualit{y}_{r\left(t-3\right)}+ {\beta }_{4}lnCultural vibranc{y}_{c\left(t-3\right)}\\ \hspace{0.17em}\hspace{0.17em}\hspace{0.17em}\hspace{0.17em}\hspace{0.17em}\hspace{0.17em}\hspace{0.17em}\hspace{0.17em}\hspace{0.17em}\hspace{0.17em}\hspace{0.17em}\hspace{0.17em}\hspace{0.17em}\hspace{0.17em}\hspace{0.17em}\hspace{0.17em}\hspace{0.17em}\hspace{0.17em}\hspace{0.17em}\hspace{0.17em}\hspace{0.17em}+{\beta }_{5}lnPopulatio{n}_{c\left(t-3\right)}+{\beta }_{6}time+{\epsilon }_r\end{array}$$

(1a)

$$\begin{array}{l}lnGD{P}_{rt}=\alpha +{\beta }_{1}ln{K}_{r\left(t-3\right)}+{\beta }_{2}lnLquantit{y}_{r\left(t-3\right)}+{\beta }_{3}lnLqualit{y}_{r\left(t-3\right)}+{\beta }_{4}lnCultural venues andfacilities{ }_{c\left(t-3\right)}\\ \hspace{0.17em}\hspace{0.17em}\hspace{0.17em}\hspace{0.17em}\hspace{0.17em}\hspace{0.17em}\hspace{0.17em}\hspace{0.17em}\hspace{0.17em}\hspace{0.17em}\hspace{0.17em}\hspace{0.17em}\hspace{0.17em}\hspace{0.17em}\hspace{0.17em}\hspace{0.17em}\hspace{0.17em}\hspace{0.17em}\hspace{0.17em}\hspace{0.17em}\hspace{0.17em}\hspace{0.17em}\hspace{0.17em}\hspace{0.17em}+{\beta }_{5}lnCultural participation and attractivenes{s}_{c\left(t-3\right)}+{\beta }_{6}lnPopulatio{n}_{c\left(t-3\right)}+{\beta }_{7}time+{\epsilon }_r\end{array}$$

(1b)

where $GD{P}_{rt}$ is the regional Gross Domestic Product (at Purchasing Power Standard, PPS) in two distinct years: 2016 and 2019. These years were chosen in order to be completely consistent in terms of time consequentiality, given the reference periods in the Cultural and Creative Cities Monitor, which is our main data source. Besides the variables of interest (cultural vibrancy, cultural venues and facilities, and cultural participation and attractiveness), the other included regressors represent the standard explanations for regional productivity, namely capital and labor. More specifically, labor enters the equations split into quantity and quality (non-tertiary educated and tertiary educated employment). The population of CCCs has been included as well to control for the size of the city together with time fixed effects. All the variables have been log-linearized.

Although we believe it unlikely that the output of the whole region can affect the cultural and creative characteristics of a city therein located, in order to control for possible endogeneity, the covariates were lagged by 3 years to better meet the need to respect the expected causality direction of the relationships. More in detail, the average values between 2012 and 2014 have been considered for capital, labor, and urban population to explain regional GDP in 2016 and the average values of the same variables between 2015 and 2017 have been used to explain regional GDP in 2019. The reference years for the cultural and creative indicators provided by the Cultural and Creative Cities Monitor can be considered as aligned to this 3-year-average lag with respect to the dependent variable. In fact, for the first wave, most data refer to 2013, while for the second wave, most data refer to 2016 in the Cultural and Creative Cities Monitor. For further details on the reference year of each cultural and creative indicators, see [88]—Annex E and [93]—Annex C.

Symmetrical to the first assumption, the second one refers to the potential beneficial role of urban creative economy and its components (creative and knowledge-based economy, intellectual property and innovation, and new jobs in creative sectors) on regional output. It is again estimated through a panel fixed effects model, and it is formalized as follows:

$$\begin{array}{l}lnGD{P}_{rt}=\alpha +{\beta }_{1}ln{K}_{r\left(t-3\right)}+{\beta }_{2}lnLquantit{y}_{r\left(t-3\right)}+{\beta }_{3}lnLqualit{y}_{r\left(t-3\right)}+ {\beta }_{4}lnCreativeeconom{y}_{c\left(t-3\right)}\\ \hspace{0.17em}\hspace{0.17em}\hspace{0.17em}\hspace{0.17em}\hspace{0.17em}\hspace{0.17em}\hspace{0.17em}\hspace{0.17em}\hspace{0.17em}\hspace{0.17em}\hspace{0.17em}\hspace{0.17em}\hspace{0.17em}\hspace{0.17em}\hspace{0.17em}\hspace{0.17em}\hspace{0.17em}\hspace{0.17em}\hspace{0.17em}\hspace{0.17em}\hspace{0.17em}\hspace{0.17em}\hspace{0.17em}\hspace{0.17em}+{\beta }_{5}lnPopulatio{n}_{c\left(t-3\right)}+{\beta }_{6}time+{\epsilon }_r\end{array}$$

(2a)

$$\begin{array}{l}lnGD{P}_{rt}=\alpha +{\beta }_{1}ln{K}_{r\left(t-3\right)}+{\beta }_{2}lnLquantit{y}_{r\left(t-3\right)}+{\beta }_{3}lnLqualit{y}_{r\left(t-3\right)}\\ \hspace{0.17em}\hspace{0.17em}\hspace{0.17em}\hspace{0.17em}\hspace{0.17em}\hspace{0.17em}\hspace{0.17em}\hspace{0.17em}\hspace{0.17em}\hspace{0.17em}\hspace{0.17em}\hspace{0.17em}\hspace{0.17em}\hspace{0.17em}\hspace{0.17em}\hspace{0.17em}\hspace{0.17em}\hspace{0.17em}\hspace{0.17em}\hspace{0.17em}\hspace{0.17em}\hspace{0.17em}\hspace{0.17em}\hspace{0.17em}+{\beta }_{4}lnCreative and knowledge based econom{y}_{c\left(t-3\right)}\\ \hspace{0.17em}\hspace{0.17em}\hspace{0.17em}\hspace{0.17em}\hspace{0.17em}\hspace{0.17em}\hspace{0.17em}\hspace{0.17em}\hspace{0.17em}\hspace{0.17em}\hspace{0.17em}\hspace{0.17em}\hspace{0.17em}\hspace{0.17em}\hspace{0.17em}\hspace{0.17em}\hspace{0.17em}\hspace{0.17em}\hspace{0.17em}\hspace{0.17em}\hspace{0.17em}\hspace{0.17em}\hspace{0.17em}\hspace{0.17em}+{\beta }_{5}lnIntellectual property and innovatio{n}_{c\left(t-3\right)}\\ \hspace{0.17em}\hspace{0.17em}\hspace{0.17em}\hspace{0.17em}\hspace{0.17em}\hspace{0.17em}\hspace{0.17em}\hspace{0.17em}\hspace{0.17em}\hspace{0.17em}\hspace{0.17em}\hspace{0.17em}\hspace{0.17em}\hspace{0.17em}\hspace{0.17em}\hspace{0.17em}\hspace{0.17em}\hspace{0.17em}\hspace{0.17em}\hspace{0.17em}\hspace{0.17em}\hspace{0.17em}\hspace{0.17em}\hspace{0.17em}+{\beta }_{6}lnNew jobs in creative sector{s}_{c\left(t-3\right)}+{\beta }_{7}lnPopulatio{n}_{c\left(t-3\right)}+{\beta }_{8}time+{\epsilon }_r\end{array}$$

(2b)

Since many authors have highlighted the relevance of the social context and the environment in determining culture and creativity (see, among others, [94,95,96,97,98]), the model is then expanded to test the role of local context conditions (enabling environment) in enhancing or triggering the positive spillovers deriving from urban cultural vibrancy and creative economy on regional output (as theorized in Section 2). More specifically, the interactions between the components of cultural vibrancy (cultural venues and facilities and cultural participation and attractiveness) and the ones of enabling environment (human capital and education; openness, tolerance, and trust; local and international connections; and quality of governance) are added as explanatory variables to Equation (1b). Similarly, Equation (2b) is expanded to include the interactions between the components of creative economy (creative and knowledge-based jobs, intellectual property and innovation, and new jobs in creative sectors) and the enabling environment ones.

Table 1. Variables’ description.

Variable	Description	Territorial Unit of Reference	Data Source
GDP PPS	Gross domestic product at purchasing power standard measuring the output of the region	NUTS2 Region (or aggregation, see Figure 2)	Cambridge Econometrics
Capital Stock	Capital stock computed through permanent inventory method (pim) from data on gross fixed capital formation	NUTS2 Region (or aggregation, see Figure 2)	Cambridge Econometrics
Employment with tertiary education	Number of employed people with tertiary education proxying the quality of regional labour force	NUTS2 Region (or aggregation, see Figure 2)	Eurostat
Employment without tertiary education	Number of employed people without tertiary education	NUTS2 Region (or aggregation, see Figure 2)	Eurostat
Population	Population of each cultural and creative city included in the sample meant at controlling for size and urbanization economies	City	Cultural and Creative Cities Monitor
Cultural Vibrancy	Cultural Venues and Facilities—Measure of physical quantities of culture-related venues such as sights and landmarks, museums and art galleries, cinemas, concert and music halls, theatres	City	Cultural and Creative Cities Monitor
	Cultural Participation and Attractiveness—Measure of the capacity of culture-related venues to attract audiences including tourist overnight stays, museum visitors, cinema attendance, satisfaction with cultural facilities	City	Cultural and Creative Cities Monitor
Creative Economy	Creative and Knowledge Based Jobs—Sectoral measure of creative economy including jobs in arts, culture and entertainment, jobs in media and communication, jobs in other creative sectors	City	Cultural and Creative Cities Monitor
	Intellectual Property and Innovation—Measure of creativity in terms of innovation including ICT patent applications and community design applications	NUTS3	Cultural and Creative Cities Monitor
	New Jobs in Creative Sectors—Dynamic measure of creative economy including new jobs in arts, culture and entertainment enterprises, new jobs in media and communication enterprises, new jobs in enterprises in other creative sectors	NUTS3	Cultural and Creative Cities Monitor
Enabling Environment	Human Capital and Education—The indicator considers the number of graduates in arts and humanities and in ICT and the average appearances in university rankings	City	Cultural and Creative Cities Monitor
	Openness, Tolerance and Trust—The indicator includes foreign graduates, foreign-born population, tolerance of foreigners, integration of foreigners, and people’s trust, considered the conditions contributing to the flourishing of cultural and creative economies	City	Cultural and Creative Cities Monitor
	Local and International Connections—Measure of local and international accessibility including passenger flights, potential road accessibility, and direct trains to other cities	City	Cultural and Creative Cities Monitor
	Quality of Governance—Composite indicator measuring the quality of government concerning three domains: education, healthcare, and law enforcement	Region	Cultural and Creative Cities Monitor

describes the details of the variables included in the model, while the following section reports the results of the empirical analysis. For the details on the measurement of the indicators taken from the CCCM, see Section 3. The reader may also refer to [88]—Annex E and [93]—Annex C.

5. Results

As explained before, the first point we address is if cultural vibrancy in CCCs (positively) affects the output of their region and, if so, through which particular component. The results of the related econometric analysis are displayed in

Table 2. Impact of urban cultural vibrancy and its components on regional output.

Variables	(1)	(2)
Capital stock	0.375 ***	0.369 ***
	(0.059)	(0.058)
Employment with tertiary education	0.082 *	0.085 *
	(0.044)	(0.045)
Employment without tertiary education	0.053	0.046
	(0.066)	(0.066)
Population city	0.029	−0.048
	(0.027)	(0.096)
Cultural vibrancy	0.116 ***
	(0.042)
Cultural venues and facilities		−0.030
		(0.087)
Cultural participation and attractiveness		0.065 ***
		(0.024)
Time fixed effects	−0.078 ***	−0.078 ***
	(0.005)	(0.005)
Constant	5.225 ***	6.526 ***
	(0.971)	(1.810)
No. of observations	372	372
R-squared (within)	0.8846	0.8849

The dependent variable is the log GDP in PPS in 2016 and 2019, respectively, for the two periods. Robust standard errors in parentheses. Statistical significance as follows: *** 1%, * 10%.

. As expected, the favorable effect of cultural vibrancy spills over from the CCCs to their whole regions (column 1). However, when the indicator is split in its two components (see Section 4), we discover that this effect depends exclusively on cultural participation and attractiveness (column 2). In sum, the mere presence of cultural heritage and facilities is not enough to trigger a spillover mechanism that significantly impacts the regional output. The “activation” of material cultural heritage through participation is, instead, what generates a positive effect on the regional economy. As for the other production factors considered in the model, the sign and significance are the expected ones.

The second point we investigated is if the creative economy in CCCs (positively) affects the output in their regions and, if so, through which specific component. The output of the regression analyses is reported in

Table 3. Impact of urban creative economy and its components on regional output.

Variables	(1)	(2)
Capital stock	0.356 ***	0.359 ***
	(0.057)	(0.057)
Employment with tertiary education	0.106 **	0.096 **
	(0.046)	(0.045)
Employment without tertiary education	0.091	0.090
	(0.070)	(0.069)
Population city	−0.031	−0.033
	(0.023)	(0.025)
Creative economy	−0.001
	(0.017)
Creative and knowledge based jobs		−0.007
		(0.013)
Intellectual property and innovation		0.015 **
		(0.006)
New jobs in creative sectors		−0.000
		(0.010)
Time fixed effects	−0.080 ***	−0.082 ***
	(0.006)	(0.006)
Constant	6.183 ***	6.224 ***
	(0.954)	(0.995)
No. of observations	372	372
R-squared (within)	0.8780	0.8815

The dependent variable is the log GDP in PPS in 2016 and 2019, respectively, for the two periods. Robust standard errors in parentheses. Statistical significance as follows: *** 1%, ** 5%.

. The mere presence of a creative environment is not enough to trigger a spillover mechanism that significantly impacts the regional output (column 1). Apparently, CCCs tend to concentrate the economic benefits of their creative economies, as well as creative and knowledge-based jobs and new jobs in the creative sectors (column 2). As for new Jobs in the Creative Sectors, this is in fact a dynamic variable. As such, it may need some time to produce benefits and spillover effects. In addition, as a dynamic variable, it does not really fit the theoretical framework of the empirical model (regional production function). Nevertheless, it was included since it is one of the components of the creative economy indicator in the CCCM. However, CCCs positively affect the output of their region through innovation, possibly as a consequence of the production of new knowledge and exchange of ideas, cooperation/integration with the regional system, and generation of novelties that might have widespread applications and potentially good market value.

Since cities differ in terms of their enabling environment (see Section 2), we moved on, deepening our analysis to understand if there are some context conditions that can trigger and/or reinforce the impact of cultural vibrancy and creative economy (and related components) on the regional output.

Table 4. Role of specific context conditions in the impact of urban cultural venues and cultural participation on regional output.

Variables	(1)	(2)
Capital stock	0.382 ***	0.346 ***
	(0.064)	(0.064)
Employment with tertiary education	0.076 *	0.084 **
	(0.045)	(0.038)
Employment without tertiary education	0.077	0.035
	(0.062)	(0.060)
Population city	−0.240 **	0.009
	(0.112)	(0.015)
Cultural venues and facilities	0.515 **
	(0.254)
Cultural venues and facilities × human capital and education	0.044 *
	(0.024)
Cultural venues and facilities × openness, tolerance and trust	0.076 ***
	(0.024)
Cultural venues and facilities × local and international connections	−0.325 ***
	(0.078)
Cultural venues and facilities × quality of government	0.017
	(0.015)
Cultural participation and attractiveness		−0.250
		(0.166)
Cultural participation and attractiveness × human capital and education		0.012 *
		(0.006)
Cultural participation and attractiveness × openness, tolerance, and trust		0.081 **
		(0.032)
Cultural participation and attractiveness × local and international connections		−0.070 **
		(0.029)
Cultural participation and attractiveness × quality of government		0.045 **
		(0.019)
Human capital and education	−0.119 *	−0.036
	(0.064)	(0.023)
Openness, tolerance and trust	−0.158 *	−0.173 *
	(0.087)	(0.098)
Local and international connections	−1.112	−8.407
	(5.148)	(8.108)
Quality of government	−0.095 **	−0.163 ***
	(0.041)	(0.054)
Time fixed effects	−0.069 ***	−0.071 ***
	(0.006)	(0.005)
Constant	13.114	31.552
	(14.994)	(23.438)
No. of observations	372	372
R-squared (within)	0.9044	0.9077

The dependent variable is the log GDP in PPS in 2016 and 2019 respectively for the two periods. Robust standard errors in parentheses. Statistical significance as follows: *** 1%, ** 5%, * 10%.

displays the results of the econometric regressions carried out to identify the specific environmental features that may catalyze the impact of cultural venues and cultural participation.

While urban cultural venues and facilities per se did not show any statistically significant spillover effect on the output of their regions (see Table 2), human capital seems to “activate” them, as can be seen by the positive and significant estimated beta-coefficient of the interacted term (Table 4, column 1). This may be linked to higher recognition of the important value of cultural heritage, more interest in conservation activities, and projects related to heritage in more educated environments.

An open and tolerant atmosphere results as a trigger of the effect of cultural venues and facilities on the regional output as well, as is visible through the positive and significant coefficient of the related interaction (this is also consistent with [54,55]). On the other hand, the negative and significant coefficient of the interaction term with local and international connections may suggest some congestion/concentration effects: in this case spillovers do not seem to be sufficiently powerful to push regional output.

As for cultural participation and attractiveness, all of our a priori of a reinforcing contribution of favorable context conditions are confirmed (see the coefficients of the interacted terms in Table 4, column 2), with the exception of logistic accessibility, where congestion and weak spillover effects prevail again.

Quality of government is here of fundamental importance because it allows participation and attractiveness to turn into a beneficial situation for the whole regional economy instead of falling into costs related to over-exploitation of heritage. In fact, borrowing from [99] (p. 606), “the quality of the governance largely explains the accumulation of material public goods, such as infrastructure, but also cultural and natural resources”.

Finally, we followed the same reasoning and empirical technique to test the role of the different environmental enabling conditions on the activation/reinforcement of the components of the creative economy in order to see if they can favor positive creative spillover effects that spread over the whole region. In fact, both creative and knowledge-based jobs (see Florida’s [13] creative class) and intellectual property and innovation are here assumed to positively influence their regional economies as well as the urban ones. In fact, Florida’s creative class has been criticized from many parts, since the author defines creativity very (too) broadly (e.g., [20,21,100]) and somehow confuses it with education (e.g., [25,26,101,102]). In addition, Florida himself recently recognized that the same (creative) forces that power urban growth also generate cities’ challenges, such as gentrification, segregation, inequality, and unaffordable housing. However, Florida’s fundamental and innovative contribution in measuring creativity through an occupational approach must be definitely recognized and appreciated.

The results are displayed in

Table 5. Role of specific context conditions in the impact of creative and knowledge-based jobs, intellectual property and innovation, and new jobs in creative sectors on regional output.

Variables	(1)	(2)	(3)
Capital stock	0.376 ***	0.392 ***	0.395 ***
	(0.059)	(0.057)	(0.064)
Employment with tertiary education	0.083 **	0.053	0.085 *
	(0.040)	(0.042)	(0.044)
Employment without tertiary education	0.061	0.024	0.054
	(0.061)	(0.064)	(0.065)
Population city	−0.078	0.004	−0.004
	(0.047)	(0.015)	(0.017)
Creative and knowledge based jobs	−0.119
	(0.091)
Creative and knowledge based jobs × human capital and education	0.018
	(0.012)
Creative and knowledge based jobs × openness, tolerance and trust	0.035 *
	(0.020)
Creative and knowledge based jobs × local and intern. Connections	−0.087 ***
	(0.019)
Creative and knowledge based jobs × quality of government	0.045 ***
	(0.017)
Intellectual property and innovation		0.055
		(0.053)
Intellectual property and innovation × human capital and education		−0.002
		(0.004)
Intellectual property and innovation × openness, tolerance, and trust		−0.026 *
		(0.013)
Intellectual property and innovation × local and intern. Connections		−0.004
		(0.008)
Intellectual property and innovation × quality of government		0.014 **
		(0.006)
New jobs in creative sectors			0.045
			(0.062)
New jobs in creative sectors × human capital and education			−0.006
			(0.006)
New jobs in creative sectors × openness, tolerance, and trust			−0.010
			(0.015)
New jobs in creative sectors × local and intern. Connections			0.001
			(0.011)
New jobs in creative sectors × quality of government			0.001
			(0.011)
Human capital and education	−0.053	0.010	0.016
	(0.038)	(0.011)	(0.014)
Openness, tolerance and trust	−0.017	0.129 ***	0.097 **
	(0.062)	(0.037)	(0.043)
Local and international connections	−1.698	1.011	1.061
	(4.927)	(6.621)	(7.638)
Quality of government	−0.179 ***	−0.061 ***	−0.049
	(0.052)	(0.011)	(0.033)
Time fixed effects	−0.070 ***	−0.073 ***	−0.067 ***
	(0.005)	(0.006)	(0.007)
Constant	12.720	2.931	2.524
	(14.205)	(19.035)	(21.813)
No. of observations	372	372	372
R-squared (within)	0.905	0.900	0.894

The dependent variable is the log GDP in PPS in 2016 and 2019, respectively, for the two periods. Robust standard errors in parentheses. Statistical significance as follows: *** 1%, ** 5%, * 10%.

, and they clearly show how the productive impact of creative and knowledge-based jobs on the regional output is triggered by both openness, tolerance, and trust (à la Florida) and quality of institutions (positive and significant coefficients of the interaction terms in column 1). Congestion and weak spillover effects linked to logistic accessibility are again apparent (negative and significant coefficient of the interaction), consistently with the previous analyses.

As for intellectual property and innovation, which were already demonstrated to favor the economic efficiency of the region, it is shown how the quality of government provides a positive institutional environment for widening the impact of innovation at the regional level (related interaction term in column 2). Interestingly, a tolerant environment seems to be detrimental to the spillover effects of innovation on the whole region. This is probably due to innovation being subject to fierce competitive mechanisms. In this context, openness and tolerance do not push towards innovative capitalistic rationality and therefore do not reinforce the impact of innovation on regional output.

Lastly, no effects of the environment on the impact of new jobs in the creative sector are detected (related interaction terms in column 3). However, as already explained above, the dynamic nature of this variable does not completely allow utilizing it fruitfully within our theoretical and empirical framework.

Overall, the cultural and creative characteristics of CCCs result so powerful that their effect spills over to benefit their whole region, especially when in presence of specific context conditions (enabling environment). Further implications are discussed in greater depth in the following section.

6. CCCs and Regional Output: Some Deeper Reflections

The cultural and creative characteristics of cities have been shown to favorably influence their regional economies. Therefore, a call for targeted policies specifically dedicated to fostering and enhancing these characteristics could come as a natural consequence. However, some related issues should be taken into consideration and discussed to avoid expressing general and deterministic policy suggestions and to grant a sustainable evolution of cultural and creative cities.

Perhaps the most relevant issue is related to the admittedly existing risk of rising inequalities in cultural and, especially, creative cities. In fact, if, on the one hand, attracting cultural talents (the so-called creative class of Florida) and boosting urban creativity enhance local economic development, on the other hand, a dark side of these relationships has been disclosed by many scholars: the rise of inequalities and the risk of social fragmentation (see for instance [63,103,104,105]). More specifically, within the urban boundaries, the presence of highly educated and creative people determines a higher demand for low-end, and therefore, low-paid services [104], and the consumption habits of the creative class tend to enlarge wage inequalities [106]. Furthermore, as explained in [107], creative industries tend to hire high-skilled professionals that benefit from a high skills premium that contributes to enlarge industry-based income inequality.

To be added to these issues, gentrification and displacement of local inhabitants or low-income people might derive from a creative urban change [108]. As argued by [63], fragile landscapes and weak segments of the urban societies could be negatively affected by rapid creativity-led urban growth. What is more, as highlighted by, among others, [9,10], culture and creativity are quintessentially urban phenomena that represent the lifeblood of cities. This aspect raises a question of spatial inequalities and urban polarization and concentration of spillovers [23]. Additionally, as argued in [106], the creative class is not evenly distributed across space, and it is less attracted by small cities [109].

In addition, some local city tensions regarding heritage buildings and potential corruption of the local elites could impede the authorities’ desire for the city to become more culturally renowned, especially when competing for European Capital of Culture or similar labels [110,111,112].

As far as the analysis carried out in this paper is concerned, the sample of cultural and creative cities includes several middle-sized cities (or second-rank cities). It can be argued that the results are not driven by the size of the cities, and this aspect leads to the expectation that the negative consequences of creative cities on inequalities might be, in our case, mitigated or softened. Furthermore, the presence of positive spillovers stemming from the urban cultural and creative characteristics on regional economies dismisses the hypothesis of excessive polarization of benefits within the urban boundaries. However, each territory is endowed with specific and distinctive characteristics, and it might be more or less affected by potential inequalities or gentrification issues. As highlighted in [113] and as also confirmed by our empirical results, no standardized development formulas for cultural and creative cities should be put in place. On the contrary, the complexity and the peculiar territorial characteristics of the cities and regions should be valorized and acknowledged.

Urban complexity and territorial distinctiveness are fundamental elements also linked to urban cultural heritage and cultural attractiveness and participation. In fact, if on the one hand, cultural heritage enhances sense of belonging and attachment to a place and positively influences relational, social, and economic dynamics (see Section 2), on the other hand, validation of certain groups at the expense of some others might be related to cultural heritage. In fact, a rhetoric of inclusion and exclusion emphasizing the distinctiveness of specific cultural identities and groups might result in closures and exclusion.

One last fundamental issue to be discussed is the risk of over-tourism and the dangerous downsides and consequences of mass tourism led by heritage sites. Tourism is a prosperous sector that represents a relevant source of economic benefits for cities and regions. However, when crowds of people invade cities because of their precious cultural sites, two typologies of negative consequences should not be neglected: a risk of physical and symbolic deterioration of cultural heritage and the exposure of the local community to discomfort caused by an excessively high number of tourists. As highlighted by Russo [114], corresponding to a disproportionate touristic flow, physical stress characterizes the experience and causes deterioration both to the quality of the environment and auxiliary facilities. Furthermore, as explained in [115], tourism influences the quality of life of local communities and the displacement of local inhabitants from central areas towards the outskirts of the cities. However, an increase in tourist flows might favor territories endowed with valuable but less well-known heritage sites.

Overall, the cultural and creative characteristics of cities represent strategic assets that favor regional economies and should be supported by dedicated suitable policies. In addition, culture and creativity can contribute to the shaping of a cosmopolitan atmosphere, able to attract investment and high-skilled labor force and to favor the generation of diverse neighborhoods [116].

However, the previously mentioned potential risks and drawbacks should be acknowledged and managed, especially considering the idiosyncratic territorial characteristics of urban and regional environments.

7. Conclusions

This work has shown how the cultural and creative characteristics of CCCs have strong spillover effects that benefit the whole regions in which they are located. As shown by the results of the empirical analysis, this is especially true when cultural vibrancy and creative economy, in their different shades and specifications, are accompanied by particular context conditions (a certain enabling environment).

Although extremely interesting, making this finding constructive from a policy point of view is no easy task. Building a cultural/creative milieu and the related convenient territorial features is, in fact, not something that can be made overnight.

Under this perspective, and consistently with the results we obtained on the role of cultural participation, the first way that comes to mind to enhance the effects we found is to favor sustainable tourism (“tourism that takes full account of its current and future economic, social, and environmental impact, addressing the needs of visitors, the industry, the environment, and host communities” [117]) (see also [118]), which has already been demonstrated to be particularly effective in middle-sized cities (see URBACT project [119]).

Moreover, identity has been shown to be a driver of development as well and heritage, both built and natural, seems to be a driving factor for both social cohesion and profitable long-lasting development. Access to culture and participation in cultural life are in fact deemed to promote individual empowerment, democratic consciousness, and social cohesion through exchanges with other people and civic engagement [2].

Additionally, paying attention to local know-how and creativity appears particularly relevant, especially when these are accompanied by accessibility, use, and production of heritage as a collective good [120].

An additional approach to the issue could be through improving higher education (universities) and innovation, also considering that the two domains can be smoothly associated. However, this undeniably implies a relatively long-term time frame, which goes far beyond short-term political considerations.

Therefore, what is needed is a real cultural (in a broad sense) transformation. Although there is still not sufficient understanding of how a sense of place can be created, maintained, and recreated, the existing debate has been highlighting the links between the natural, physical, social, cultural, political, and economic environments and thus encourages holistic thinking [9].

Even if the present work revealed a significant relationship between the cultural and creative features of CCCs and economic efficiency in terms of positive spillover effects on the regional output, and some previous work already highlighted the importance of cultural heritage in more intangible territorial characteristics (e.g., creativity or identity), a significant impact of culture/arts/creativity on more socially relevant aspects, such as inclusion, has not been conclusively found until now. Depending on data availability, testing this relationship could be one of the main future developments of this research.

Finally, the current pandemic situation calls for a deep reflection on the changes the whole world will have to face, also regarding the aspects we have been discussing all along the present work. Although the “old normal” is probably gone forever [121], culture and creativity can be an opportunity for territorial resilience when the health emergency will be overcome, also in terms of social impact favoring mental health [122].

Only involving territorial culture and creativity, in fact, it will be possible to deal with the medium and long-term social consequences of the Covid-19 pandemic. In this sense, culture is to be seen as a tool of welfare, well-being, and action on the vision for the future.