Over drinks one night in West Hollywood, I met a drag queen who was crowned with a tall blue wig — Marge Simpson style — with lights woven throughout it. She was a friend of a friend and, like most of the group we were with, a queer performer. I was something of the odd man out — an urbanist who works with cities to build inclusive economies.

Chatting with this queen, I learned that she had recently moved from Montana to Los Angeles in search of a more welcoming community and stronger career prospects. A few weeks later, I saw her take the stage at a packed club that charged 20 bucks a cover.

How a society treats its most vulnerable not only says a lot about what it values but, ultimately, its economic vitality. One of the key points missing from the current debate and backlash around diversity, equity and inclusion is the real economic value marginalized people bring to communities. If your city has a diverse and growing economy, then chances are your city doesn’t just value inclusion — it’s passing what I call “The Drag Queen Test.”

The Drag Queen Test is my shorthand for evaluating a city’s economic vitality. It asks the following: How does the city treat its drag queens? Does it have nondiscrimination laws? Does it avoid restrictions on adult performance? Does it foster safe spaces for queer communities? Does it possess an ecosystem that supports queer talent and expression? Do local queens make it to “RuPaul’s Drag Race,” the televised pinnacle of the drag queen industry? Cities that answer “yes” to these questions are more likely to have dynamic cultures and inclusive communities — and yes, thriving economies. Let me explain.

Aside from being extravagant performers, drag queens are economic actors helping to create and sustain jobs. They serve as compelling symbols for LGBTQ+ communities, which, thanks to skewing youthful and highly educated, have significant purchasing power (nearly $4 trillion in 2023). And, as I saw at the L.A. club I was in, drag performances also generate important economic activity for cities, a pull for entertainment districts across the country.

So, as someone whose job involves helping communities thrive, allow me to clap back against the mean-spirited attacks we’ve seen on drag queens and trans individuals. The faux outrage and restrictive state laws focused on bathrooms, pronouns, drag performances and publicly funded DEI programs —intended to further marginalize already vulnerable people — have important and negative economic implications.

Why? Because attacking drag turns off a much larger group of people: the creative class, including the STEM, artistic and professional talent in knowledge-intensive fields that are critical drivers of innovation and growth. (After all, who doesn’t love a good drag brunch?) These creative class workers tend to gravitate toward cities where they feel welcome and included — and how a city treats its drag queens becomes a proxy for how it treats other groups. In other words, a community that embraces its most marginalized is not going to shun other minority populations. This welcoming culture translates into economic growth for the very basic reason that more workers and more consumers lead to greater activity and growth.

The Drag Queen Test isn’t merely pop urban theory. UCLA Law School’s Williams Institute found that public protections and acceptance of queer people correlate with increased per capita GDP. “Inclusion can enhance the economy, primarily by promoting an increase in the human capital available to the economy and by using existing human capital more efficiently,” a 2018 report stated.

A 2023 Wells Fargo study expressed similar findings with a bit more flair, calling LGBTQ+ inclusion the “secret sauce” for economic growth. “Higher population shares of LGBT individuals were associated with stronger [gross state product] growth rates, everything else equal,” it concluded. This held true for cities beyond New York and L.A.: Atlanta, Detroit and Minneapolis, for example, have higher GDP per capita than most U.S. metro areas as well as large queer populations — and they all pass The Drag Queen Test.

In “The Rise of the Creative Class,” urbanist Richard Florida presented his “Gay-Bohemian Index,” which helps explain these findings, measuring the relationship between local queer populations and economic strength. Florida’s research shows that the proportion of queer people in a particular place positively correlates with economic dynamism for two reasons: the aesthetic-amenity premium and the tolerance (or open culture) premium.

The aesthetic-amenity premium is the concentration of cultural assets that increase a neighborhood’s desirability — such as bars, clubs, museums and theaters — which is higher in areas with large queer populations. These groups also tend toward creative occupations, leading to greater levels of entrepreneurship. The tolerance premium captures community inclusiveness — more inclusive places show higher demand for housing since more people feel safe in those neighborhoods, a pattern that further contributes to urban development, though it can also increase cost of living.

Florida concludes that a strong LGBTQ+ presence “signals that a location has the very characteristics that drive innovation and growth, driving further innovation and growth.” This brings us back to The Drag Queen Test. A city that supports drag queens supports the LGBTQ+ community and, by extension, fosters the creativity and innovation that drive economic growth. It would behoove cities, therefore, to foster communities where drag queens, trans individuals, queer people and their allies feel welcome. Doing so shows LGBTQ+ people and the wider creative class that the city is welcoming and full of the amenities that many people — LGBTQ+ or not — look for.

For growth and innovation, cities should prioritize inclusion, ensuring that opportunities abound across demographics. Toward that end, an essential ingredient to inclusive growth is seeing drag queens or any minority population, such as Black entrepreneurs or women in tech, as important economic actors worthy of respect. In short, if you want to help create more jobs and foster a bustling, economically vibrant city, don’t forget to tip your drag queen.

Nicholas Lalla is an urbanist, working at the intersection of emerging technology and economic development. He is the author of “Reinventing the Heartland.” For more info, visit www.nicholaslalla.com.

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