Publication

Evaluating the local business growth effects of the UK City of Culture 2013 and 2017: A simple propensity score matching-difference-in-difference modelling approach

Published: 27 February 2024

ERC Insight paper

Associated Themes

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  Business Growth
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  Innovation

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Evaluation of Cities of Culture (CoC) are typically focused on their cultural and tourism dimensions, with less attention often paid to their longer-term economic impacts. Here, we draw on longitudinal data for businesses across the UK to estimate the local business growth effects of CoC 2013 and 2017. Specifically, we use a firm-level, propensity score matching-difference-in-difference modelling approach to compare business growth in each CoC to a matched control group of firms in the other shortlisted cities. For CoC 2013 among the group of matched firms, employment grew 4.6-4.7 per cent faster on average over 2 years after the CoC, and 19.3-20.3 per cent faster over 4 years than in the other shortlisted cities. We find no consistent evidence of significant impacts on firms’ sales growth in Derry over either 2 or 4 years after the CoC. For Hull, we find little evidence of any robust effects on either firm sales or employment growth although it is very likely that any longer-term benefits of CoC 2017 were dominated by impacts of the COVID-19 pandemic. Our results suggest that Cities of Culture can lead to significant economic benefits, however, these are not guaranteed

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