The Impact of a Business School on Regional Economic Development: a Case Study

Abstract

This paper investigates the impact of a major extension to Lancaster University's Management School on the North West regional economy. It differs from earlier university impact studies since the estimated impact is not confined to backward linkage effects but focuses specifically on the forward linkage effects that will occur as a result of greater engagement with firms in the region's SME sector. The paper demonstrates that the expansion of the university sector can have far greater beneficial effects on their regional economies than is indicated by conventional impact studies. Specifically, the provision of business advice to SMEs can be a significant factor in increasing their sales volume.

Reach-in and Reach-out

“…The cluster of pipeline engineering businesses in the region has been significant in transferring knowledge into the university by providing human resources and teaching expertise, as well as benefiting from knowledge transfer from the university, not necessarily via the most prominent mechanisms of spin out companies and licensing of technology, but via the employment of highly skilled graduates. This resonates closely with the notion of forward links that local universities can create by engaging with local businesses, significantly contributing to regional development (Cox and Taylor, 2006).…”

“…The Lambert Review (HM Treasury, 2003) concluded that more could be done to support new sectors, small and medium-sized enterprises and services through better engagement with higher education, particularly regionally and locally, and from 2004-5 RDAs have had a larger formal role in the distribution of HEIF funding. Cox and Taylor (2006) recognise two types of linkages between a university and the regional economy: backward linkages arising as an expenditure of university staff and students in the local economy and forward linkages which often arise as an effect of the services provided by the university to the regional economy (e.g. business support, human capital formation, knowledge economy).…”

Evaluation of High Educational Institutes Economic Impact with Satellite Accounting: An Empirical Application in Greece

“…The assessment of the economic impact of HEIs may be approached by treating a university or TEI as any other business or economic organization, measuring the direct and indirect economic effects poured into a region's economy because of the expenditures associated with the establishment and operation of HEIs. Studies of the impact of a university on the regional economy have not been confined only to backward linkage effects, but also have focused on the forward linkage effects that result from greater engagement with the region's enterprises, revealing that the expansion of the university sector can have great benefit to regional economies, increasing enterprises' sales volume (Cox and Taylor, 2006). Di Veroli and Tartamella (2008) consider the role of government in the process of income redistribution associated with education as another significant element that occurs from the assessment of economic impact of educational institutions.…”

“…The necessity and usefulness of evaluating the effect of a HEI on local economy have become perceptible in countries such as Australia (Garlick, 2005), the islands of the Southern Pacific (Thaman, 2007), Sweden (Duke, 2005), Holland (Raymond, 1992), European countries (Paterson and Lindsay, 2001), Canada (Martin, 1998) and Great Britain (Cox and Taylor, 2006;Bleaney et al, 1992). Drucker and Goldstein (2007) and Bessette (2003) concluded that university activities had "substantially positive results" on the regional economic development of the United States.…”

Economic Impact of Pharmacy Graduates on a Regional Economy

“…[1][2][3] 6,7 In addition, the economic impact of higher education spending is disproportionately higher for small and medium-sized economies (ie, those with fewer than 200,000 nonfarm jobs) because there are fewer large industries available to drive local economic growth. 8 While the economic impact on the local economy of some university departments and colleges, such as business schools, athletic departments, and health science centers, have been studied, [9][10][11] little research has been done on the economic impact of schools and colleges of pharmacy. Several factors unique to pharmacy education may explain why conducting an economic impact study is challenging.…”