Marshallian and Jacobian externalities in creative industries: Evidence from Chile

Abstract

Most papers on creative industries ask whether they are a source of Marshallian or Jacobian effects, inasmuch as a stronger creative sector is a direction of diversification that could have positive spillovers onto the rest of the economy. While most works have focused on developed economies, I contribute evidence from a middle-income Latin American country and study both creative occupations and creative sectors. I find that specialisation in creative sectors is associated with higher sales and a larger number of firms in those sectors, albeit at a decreasing rate. A similar relationship is found between specialisation in creative occupations and the income of those workers. I find no evidence of effects of creative specialisation on other sectors.