Here is a brief excerpt from an edited version of an interview of Richard Florida by Rik Kikland, senior managing editor of McKinsey Publishing, in which Florida explains how creative companies and the venture capital that drives them are increasingly flowing to cities, and what that means for economic and societal development. To watch the video of the interview, read the transcript, check out other resources, learn more about McKinsey & Company, and register to receive free email alerts, please click here.

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The financial crisis profoundly altered the economic landscape, particularly in the United States. In this video interview, academic and author Richard Florida explains how energy and creative, knowledge-based companies—particularly in the high-tech field—are increasingly consolidating in urban areas, generating a new economic growth model. This interview was conducted by Rik Kirkland, senior managing editor of McKinsey Publishing.

A new growth model

The US economy really is stumbling towards a new growth model. And many people see this growth model in conflict. Even Tom Friedman wrote this piece in the New York Times saying that places that have natural resources and oil, they suffer from a resource curse. They’re damned because they get lazy. And one of the things I found is that our energy sector—and obviously this isn’t rocket science—our energy sector is booming. Texas, Oklahoma, up through the Plains States, it is booming.

The highest rate of productivity in the country on a per capita GDP is Midland, Texas, at over $100,000 a person, well ahead of San Jose. And what I’ve speculated in this piece1is our old growth model, our auto-, housing-, suburban-driven model is giving way to a new growth model, which I call the “knowledge energy growth model.”

I don’t think these things are in conflict, and one of the things I talked about a lot is people see Houston as an energy center. And that’s right, it is. But it has some of the high-techiest stuff in America. Extraordinary concentrations of software engineers, info-techs. So one of the things I speculated is, even though there are winners and losers, there is this new growth model emerging that has a lot of potential. What other nation has as many energy resources as America? What other nation can boast as many great research universities? What other nation has one high-technology complex that would rival, never mind a Silicon Valley, but a Boulder?

Put those things together, and it might not be all gloom and doom. There might be a glimmer of hope, and I think more than a glimmer of hope, a ray of sunshine for economic future.

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To watch the video and/or read the complete transcript, please click here.

Richard Florida is director of the Martin Prosperity Institute at the University of Toronto’s Rotman School of Management, a professor of global research at New York University, and a senior editor at Atlantic Monthly, where he cofounded and is editor-at-large of The Atlantic Cities. Rik Kirkland is senior managing editor of McKinsey Publishing and based in McKinsey’s New York office.