Efficient creativity in Mexican metropolitan areas

Abstract

Human creativity is the most important economic resource. Yet, very few studies in the economic literature have attempted to evaluate the efficiency of creative sectors around the world. In that regard, this paper examines the efficiency of the production of creative goods in Mexico. The empirical examination is made covering 36 metropolitan areas at four different periods of time, using the quinquennial economic censuses taken by the government in 1998, 2003, 2008 and 2013. The paper first estimates the static performance of the creative industries by means of data envelopment analysis models. Subsequently, the Malmquist productivity index is used to estimate their dynamic efficiency. Using both analyses, it is shown that, contrary to a commonly held view in the literature, most of the efficient creative industries in Mexico are to be found in metropolitan areas that are not relatively large. Furthermore, it is also found that more than three fourths of the creative sectors in the metropolitan areas are inefficient. The paper then makes use of Florida's 3Ts model to explore some possible factors that could account for those inefficiencies. Two features that are not widespread in Mexico, good public infrastructure and culturally diverse cities, are found to be explanatory factors of best practices in the production of creative goods.