The Reinvestment Fund

Funding Received: 2011
Philadelphia, PA
Funding Period: 1 year and 5 months
August 12, 2012

CultureBlocks is a collaboration between The Reinvestment Fund (TRF), the City of Philadelphia’s Office of Arts, Culture, and Creative Economy (OACCE), and the University of Pennsylvania Social Impact of the Arts Project (SIAP). Its purpose is to develop a web-based tool for displaying Philadelphia’s cultural assets in ways that is useful to artists and cultural organizations, public officials, development professionals, and the general public. In addition, TRF and SIAP are collaborating on several research projects based on the web-based application.

Katie Nelson, Senior Associate at PolicyMap, explains some of the project's conclusions:

NELSON: One aspect of our research agenda is to use SIAP’s cultural database to examine changes in Philadelphia’s cultural sector over the past fifteen years. In particular, we are interested in whether the clustering of cultural assets is good for the cultural sector and for the neighborhoods in which they are located.

In order to examine these questions, SIAP developed two ways of classifying cultural districts—by composition and by social and spatial advantage.

Often implicitly, creative placemaking is based on cluster theory. Most associated with Michael Porter, cluster theory posits that the bunching of firms in particular locations creates efficiencies that can spur economic development. This line of thinking has encouraged several national governments, including France, to use incentives to promote clustering.

Yet, Porter has come in for wide-ranging criticism. As Gilles Duranton of the University of Pennsylvania has noted:

[I]t is unclear what cluster policies should do and how they should do it. This is true even in the simplest setting. Considering richer frameworks of analysis only multiplies the ambiguities. Cluster policies can even turn ugly when implemented by less than perfectly benevolent governments.

Very large economic benefits from clusters might provide a justification for brushing aside these concerns. However, the benefits from clustering on local earnings and local productivity are small. For other outcome measures such as innovation, existing research even suggests that clustering plays a negative role. (Duranton 2011: 4)

This does not mean that clusters are always bad, but it suggests that artificial clusters created through top-down policies are likely to fail. Certainly, the history of planned cultural districts suggests that these top-down approaches rarely work and—even when they are viable—provide limited benefits for the cultural sector.

This line of reasoning has encouraged us to think about bottom-up approaches to arts-based community revitalization. We use the term “natural” cultural districts to refer to districts in which cultural assets cluster, not because of policy prescriptions, but because it makes sense to the artists, entrepreneurs, and organizations involved.

But not all clusters are alike. We discovered that some clusters are composed of one predominant type of asset; for example, a neighborhood with many artists but few organizations or many nonprofit cultural organizations, but few artists or commercial firms. (We call these nonprofit-dominant, artist-dominant, and commercial-dominant clusters.) Other clusters have a more complex composition, with a concentration of artists, nonprofits, and commercial cultural firms.

We then asked which types of districts are more sustainable and provide a greater probability of growing over time. We found that the complex clusters were remarkably stable. Of the 63 block groups that were judged complex in 1997, 47 (75 percent) were still high complex in 2010. The block groups dominated by a single cultural asset were much less stable.

Of course, the decline of some districts was accompanied by the increases in other parts of the city. Between 1997 and 2010, 134 block groups became commercial-dominant and 136 block groups became nonprofit-dominant. The vast majority of these were located in upper North Philadelphia and the lower Northeast, areas that were attracting both immigrants and African Americans during these years. Artist concentrations emerged in 90 block groups, which included significant clusters in West Philadelphia and adjacent to the existing cluster in South Philadelphia. Artist concentrations also formed in the Art Museum and Brewerytown neighborhoods.

With such volatility in the ebb and flow of cultural assets, cities need to be careful about when and how to invest in them. On the one hand, it suggests that “Good Government 101” — reliable city services and honest government — are a good starting point for encouraging these districts. On the other hand, making investments after people on the ground have committed to a neighborhood seems like smart policy. For example, Maryland has a program of designated arts and entertainment districts, but the proposed district must demonstrate that there’s an existing cultural scene to win designation.

Our findings on the sustainability of complex cultural districts also have implications for policy. They suggest that the success of cultural districts — and by implication the success of individuals and organizations within those districts — is a function of their ecology. Rather than applying organizational metrics to judging the likelihood of future success, funders and policymakers may choose to encourage the cultural diversification of districts.

Economic and spatial advantage
“Natural” cultural districts benefit from a variety of social conditions. Higher-income neighborhoods, an abundance of rental properties, and distance to Center City all make it easier for a district to emerge. If the arts and culture are to play a role in promoting social inclusion and justice, however, we need to pay attention to neighborhoods that are relatively disadvantaged in these qualities but “overachieve” in spite of these challenges. We call these overachievers "civic clusters" because they usually are inspired by the civic engagement of local residents.

In contrast to a shortsighted top-down strategy of betting on advantaged districts, a longer-term strategy would build on the social and economic benefits that cultural engagement generates in all types of cultural districts, including civic clusters. It would define cultural engagement broadly to include conventional notions of high art as well as the popular culture and folk traditions of all groups that inhabit the contemporary city. Rather than using government and philanthropy to reinforce market forces, a long-view policy would compensate for market failure and promote social equity. Over time, the strategy would promote social inclusion and the productive utilization of all of the city’s fiscal, human, and social capital.

Duranton, Gilles (2011). California Dreamin’: The Feeble Case for Cluster Policies, Review of Economic Analysis 3,3-45.
Porter, Michael E. (2000). Location, Competition, and Economic Development: Local Clusters in a Global Economy, Economic Development Quarterly 14, 15–34.
Stern, Mark J. and Seifert, Susan C. (2012). “Natural” Cultural Districts: A Three-City Study.”