Creative industries and productivity in the European regions. Is there a Mediterranean effect?

The existence of a Mediterranean way of creativity and its effects on regional performance has been discussed in European development strategies. However, there is little evidence supporting that idea. This paper addresses this issue by using data on creative industries for a sample of 276 European regions and the local linear least squares estimator, able to deal with parameter heterogeneity. The results suggest that creative industries increase labor productivity. Nevertheless, the paper contributes by providing, for the first time, evidence that the average impact of the creative industries for Mediterranean regions is not substantially different from that for the rest of European regions. However, other territorial patterns emerge, showing the heterogeneity of the impacts of creative industries, which can be even negative in some regions. This evidence has implications for regional, economic and cultural policies.