Creative class dynamics, technological evolution and growth

Torben Klarl

No 2504, Bremen Papers on Economics & Innovation from University of Bremen, Faculty of Business Studies and Economics

Abstract: This paper investigates the impact of creativity on technological advancement, long-term economic development, and social welfare, with creativity endogenously determined through interactions within social networks. We demonstrate that an economy remains stagnant, exhibiting neither networking nor long-term growth, when the size of the creative class falls below a certain positive threshold. Conversely, surpassing this threshold triggers active networking between creative and non-creative individuals, fostering sustained technological progress and income growth. We calibrate the model and simulate the economy’s transition from stagnation to dynamic growth. Although immediate welfare gains from transitioning to a growing economy are modest, medium- to long-term welfare improvements become substantial due to the cumulative effects of technological advancement facilitated by networking.

Keywords: Creativity; Population dynamics; Innovation; Technological evolution; Endogenous growth; Network; Welfare (search for similar items in EconPapers)
JEL-codes: E13 E14 I30 O11 O31 O33 (search for similar items in EconPapers)
Pages: 35 pages
Date: 2025-08
New Economics Papers: this item is included in nep-ent, nep-gro, nep-ino and nep-net
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Persistent link: https://EconPapers.repec.org/RePEc:atv:wpaper:2504

DOI: 10.26092/elib/4429

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