Please enter verification code
Theoretical Analysis on Economic Impacts of Universities on Regional Economies
International Journal of Economy, Energy and Environment
Volume 5, Issue 5, October 2020, Pages: 69-73
Received: Aug. 24, 2020; Accepted: Sep. 5, 2020; Published: Sep. 23, 2020
Views 138      Downloads 99
Habtamu Kefelegn, Department of Economics, Faculty of Business & Economics, Mekdela Amba University, Mekane Selam, Ethiopia
Article Tools
Follow on us
Policy makers widely recognized that universities have dynamic contribution to individuals, to the regional and national economy and to society as whole. Now a days understanding the economic impacts of universities that convey to the hosted local economy and communities in which they are located is attracting extensive attention in scientific community. This paper tries to analyze the economic impact of universities on regional economies from empirical literatures. Methodologically, the paper used systematic reviewing approach that follows the distinct phases of planning, searching, screening, coding and synthesis. The results of the study found that universities hosted in different region of given country positively and significantly affect private consumption, public spending, investment, employment, urbanization and industrialization, human capital variables and sustained regional economy. Moreover, individuals, firms and local government and economy can be better-off with universities. These institutions also lead the agriculture, industry and service sectors growth of regional economy. Despite this, the result also suggests critical assumptions like quality of public infrastructure, quality of teaching and research, university-industry-community partnership, academic freedom and peace and stability of region determine the level of impact it works. Finally, the study suggests national government should lead efforts towards improving both the regional universities and local economy to promote efficiency and equitable development in the entire economic system of the nation.
Regional Economies, Universities, Systematic Review, Economic Impacts, Research, Human Capital
To cite this article
Habtamu Kefelegn, Theoretical Analysis on Economic Impacts of Universities on Regional Economies, International Journal of Economy, Energy and Environment. Vol. 5, No. 5, 2020, pp. 69-73. doi: 10.11648/j.ijeee.20200505.11
Copyright © 2020 Authors retain the copyright of this article.
This article is an open access article distributed under the Creative Commons Attribution License ( which permits unrestricted use, distribution, and reproduction in any medium, provided the original work is properly cited.
Smith, T. R., Drabenstott, M., & Gibson, L. (1987). The role of universities in economic development. Economic Review, 72 (9), 3-21.
Schendel, R., McCowan, T., & Oketch, M. (2014). The economic and noneconomic benefits of tertiary education in low-income contexts. International Higher Education, (77), 6-8.
Kofoworola, A. A., Akinsanya, A. O., & Tope, O. Selected Impact of a University Community on the Development of Its Host Community in Nigeria.
Sudmant, W. (1994). The economic impact of the University of British Columbia. The Office.
Kotosz, B. (2013). Local economic impact of universities. Analecta Technica Szegedinensia, 7 (1-2), 22-26.
Gakenheimer, R. A. (1967). Letters about The Economic Impact of a University on its Local Community.
Brown, K. H., & Heaney, M. T. (1997). A note on measuring the economic impact of institutions of higher education. Research in higher education, 38 (2), 229-240.
Blackwell, M. Cobb, Steven and Weinberg, David (2002) The Economic Impact of Educational Institutions: Issues and Methodology. Economic Development Quarterly, 16, 88.
Oketch, M., McCowan, T., & Schendel, R. (2014). The impact of tertiary education on development: A rigorous literature review.
Abel, J. R., & Deitz, R. (2011). The role of colleges and universities in building local human capital. Current issues in economics and finance, 17 (6), 1.
Kotosz, B. G., Gaunard-Anderson, M. F., & Lukovics, M. (2015). The local economic impact of universities: an international comparative analysis.
Kotosz, B. G., Lukovics, M., Molnár, G., & Zuti, B. (2015). How to measure the local economic impact of universities? Methodological overview. Regional Statistics, 5 (2), 3-19.
Carroll, M. C., & Smith, B. W. (2006). Estimating the economic impact of universities: The case of Bowling Green State University. Industrial Geographer, 3 (2).
Economics, B. (2019). Economic contribution of the LERU universities. A report to LERU.
Valero, A., & Van Reenen, J. (2019). The economic impact of universities: Evidence from across the globe. Economics of Education Review, 68, 53-67.
Science Publishing Group
1 Rockefeller Plaza,
10th and 11th Floors,
New York, NY 10020
Tel: (001)347-983-5186