I was just reading this article and immediately saw a nice parallel. Take a look at "The Secrets of Intangible Wealth" - http://reason.com/news/show/122854.html. It's about a World Bank study of the effect of intangible capital on productivity. One conclusion that can be drawn from the study is that pure application of financial capital in itself does not result in productivity - in other words, it's not just where the money is. It seems pretty clear that startup hubs have a significant amount of intangible capital related to startups. For economic development in general, according to the study, natural and financial capital are actually dwarfed by intangible capital: "In the U.S., according to the World Bank study, natural capital is $15,000 per person, produced capital is $80,000 and intangible capital is $418,000." It would be great if there were a study on startup-related development so we had solid data, but it would not be surprising to me if the effect of startup-related intangible capital in startup hubs was indeed significant.