Geography of Talent for Understanding Regional Disparities in Spain

IntroductionTalent is an emerging paradigm at the heart of the debate about economic development and a subject of growing interest among not only economists, economic geographers and, regional scientists (Florida 2002a, Mallender and Florida 2007), but also sociologists, and urban planners (Power and Scott 2004, Hartley 2005, Cooke and Lazzeretti 2008, Lazzeretti et al. 2008). Regional development is driven by changes in economic specialization; Karlsson and Johansson (2008) identify talent as the basic driver of such regional specialization and development. Knowledge based economic growth and local development today are found according to Lucas (1988), in association with the productivity gains brought with the "clustering of talented people". Other authors have similarly highlighted that local development is closely related to the presence of high skilled human capital (Glaeser et al. 1992, Henderson et al. 1995, Capone 2006). Indeed, economists have long stressed the link between the agglomeration of talent and regional development, reporting tentative empirical evidences that the agglomeration of human capital contributes to regional development. Given this association between talent and economic development, and the fact that talent is unevenly spread, it becomes critical to understand the factors that account for its varied geography (Mallender and Florida 2007).This paper contributes to the literature by investigating the Southern European case study, Spain. It attempts to identify the role of talent for furthering our understanding of regional disparities in Spain. Here, talent is identified as the group of individuals who are highly educated and occupied with strategic sectors, which assumed to be strategic for regional growth in that they provide economic specialization, including the high-tech sector, knowledge intensive services, real estate, architecture and engineering, R&D, advertising and market research, professional, scientific and technical activities, financial and insurance activities and creative activities. This paper constitutes an empirical evaluation of the impact of talent on regional differentiation by means of a detailed analysis of the 17 Autonomous Communities of Spain between 1996 and 2004. The static, non-spatial panel data models are simply constructed. The unit of analysis is NUTS2.In the following section, discussions in the literature examining the impact of the concentration of talent on regional development are briefly reviewed. In section 3, first, the geography of talent, the characteristics of the Spanish regions and their levels of development are described. Second, data and research methodology are outlined, while the concentration of economic activity and the spatial distribution of talent in Spain's Autonomous Communities are analysed, the models of talent and regional development are discussed and findings are presented. The last section evaluates and discusses the achieved results.Theoretical Framework: Talent and Regional DevelopmentMany studies demonstrate that the quality of a region's labour force is a key determinant of that region's economic success (Glaeser 2000, Florida 2002a, Simon and Nardinelli 2002, Petrov 2008). Talent have long been linked to urban and regional growth and their presence considered key components of innovation, is essential for economic development. In this section we provide a brief summary of the voluminous literature on the effects of the concentration of talent on regional development. The literature has two types of talent: human capital and creative class (Qian 2008). As discussed above, highly educated people and employment in selected sectors, deemed strategic for the economic performance of regions in that they provide economic specialization, comprise our measure of talent. This paper examines accordingly the impact of both on regional disparities in Spain.In recent decades, knowledge based and creative sectors have encouraged economic specialization. …