PUBLICATIONS & REPORTS

Contents Introduction

Recent studies on economic growth reveal an increasing interest on the role of not only physical factors but also endogenous ingredients linked to technology, R&D, creative ideas, consumer’s preference on cultural products (i.e., recreation, music, dancing, movie, and general education, etc.,) as well as cultural diversity (ethnicity, language, religion, and other inherent traits). This paper attempts to analyze the effects (roles) of the overall contributors including cultural variables to the growth of urban areas in Korea. Despite the short history of urban statistics, various specification such as production function, Solow residual equation, and pooling of cross-section and time series data are experimented to identify the marginal effects of theoretically relevant inputs. Also the growth source analysis by both city and pooled data finds the proximate contribution of each variable to the growth of cities under study. Productivity is found to be the first runner in every city, followed by physical capital, citizen’s spending on cultural products, and human capital. But the effects of cultural diversity indicators we employ are interestingly promiscuous, possibly due to limited heterogeneity of Korean society. Korean data set does not allow us to test satisfactorily our hypothesis on affirmative role of cultural diversity, but this promises to be interesting path to explore further.