In this paper we carry out a meta-analytic review of the literature on culture-led local development models. We identify and discuss three typical fallacies characterising mono-causal culture-led development schemes: instrumentalism, over-engineering, and parochialism. We then discuss their analytical background, and provide examples illustrating the consequences of each. Based upon this critical discussion, we make a case for a ‘new territorial thinking’ approach that takes into account the tangled hierarchy of global and local viewpoints that is connatural to spatially situated cultural production, and focuses upon a non-linear, multi-causal scheme as the only possible framework for the policy design of credible, socially accountable, culture-led development strategies.

This article focuses upon the relationship between culture, urban regeneration schemes, and their impact on socio-cognitive assets – namely, social and human capital. It examines three major urban regeneration projects in the districts of Saint Michel (Montreal, Canada), Auburn (Sydney, Australia) and Bicocca (Milan, Italy), where culture has been invoked as a main transformational driver at the economic and socio-environmental levels, but with different approaches and results. Through comparative analysis, we develop a more general reflection on the social impact of culture-led urban transformation processes, questioning the actual role of cultural initiatives – particularly those related to the creation of new cultural facilities and the programming of big cultural flagship events – and participation as a means to improve the local social milieu. We find that a key role for social efficacy is played by projects’ capacity to elicit the commitment of residents through inclusive cultural participation, as opposed to instrumental top-down initiatives mainly addressing city and neighbourhood branding and real estate marketing purposes.

We develop a new conceptual framework to analyze the evolution of the relationship between cultural production and different forms of economic and social value creation in terms of three alternative socio-technical regimes that have emerged over time. We show how, with the emergence of the Culture 3.0 regime characterized by novel forms of active cultural participation, where the distinction between producers and users of cultural and creative contents is increasingly blurred, new channels of social and economic value creation through cultural participation acquire increasing importance. We characterize them through an eight-tier classification, and argue on this basis why cultural policy is going to acquire a central role in the policy design approaches of the future. Whether Europe will play the role of a strategic leader in this scenario in the context of future cohesion policies is an open question.