Impacts of transit and walking amenities on robust local knowledge economy

Publication Date

May 2018

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As of 2013, knowledge economy has held more than 10% of U.S. employment, generated nearly 20% of national GDP and expect to increase to 25% during the next 20 years. Likewise, Eurostat 2020 aims to increase investment in Knowledge Intensive Business Services (KIBS) to bypass the competitors, Japan and the U.S. As the result, investigating the determinants of robust knowledge economy is a continuing concern between city scholars, planners and leaders. To date, several locational and non-locational factors have been found to be influential. For instance, transit service, walkable street networks and dense neighborhoods that provide walkable access to urban amenities are the location preferences for the creative class. Creative class, in turn, attracts KIBS, and produces innovation which are all contributive to the knowledge-based economic vitality. While such trend is widely supported by the theoretical efforts, there is little empirical evidence on these complex multidimensional relationships and hence this study seeks to investigate both direct and indirect impacts of transit and walking amenities on the robust local knowledge economy. Using Structural Equation Modeling (SEM), we developed a comprehensive model that accounts for KIBS, creative economy and innovation productivity and investigates their locational and non-locational determinants with the particular focus on walking and transit amenities. Our results generally echo the findings of previous studies about the key role of industry clustering, place quality amenities, diversity and tolerance on the three drivers of robust local knowledge economy. We found that among all exogenous variables racial diversity and industry clustering have the most significant direct effect on innovation productivity. We also found that transit service quality and walkability contribute to a robust local knowledge economy through KIBS and creative class, but they have an adverse relationship to the innovation production of the STEM small firms. This might be due to the fact that walkability and transit access increase the property values and, therefore, make them unaffordable for small innovative firms. Our findings on the impacts of walkability and transit access on innovation productivity in vulnerable small firms call for attention to the equity aspects of innovation-supportive urban developments.


Transit, Walkability, Knowledge economy, KIBS, Creative industries, Innovation


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