The Contribution of the Arts and Creative Economy to Social Capital: Evidence from the COVID-19 Pandemic

Abstract

While there is a large literature about the importance of social capital and its impact on economic and social flourishing, much less is known about the relevance of the arts and creative communities as inputs to social capital. Using cross-sectional variation in the exposure of different counties to the arts and creative communities prior to the pandemic, we quantify how their employment declines are associated with social capital. We find that a 1 percentage point decline in arts employment growth between February and May 2020 is associated with a 0.16 standard deviation decline in social capital. We find even stronger effects when we focus on the creative economy at large, concentrated in the association with collective efficacy and shared norms within a community. Our estimates are robust to the inclusion of median household income, overall county employment growth, and state fixed effects. These results suggest that there is an open window for state and local policy interventions that promote economic development and social capital through the arts and creative communities.

Keywords: Arts, Cities, Cultural Capital, Social Capital, COVID-19

JEL Classification: D91, E71, J21, Z11