The Impact of Universities on Regional Economies

This project is part of City-REDI’s insights into the ways that universities can influence their host regions. Higher Education Institutions (HEIs) have a multifaceted role to play in driving local economies. From generating, attracting and retaining human capital to innovation, entrepreneurship and demand increases, universities can be a catalyst of local economic development. 

This project aims to identify the economic impact of universities in their regional economies by focussing on the effects of increased spending associated with HEI activities. 


The project uses a multi-regional Input-Output model for UK NUTS2 regions and combines it to microdata from the Living Costs and Food Survey to:

  • Introduce the concept of absorptive capacity for local economies benefiting from university spending.
  • Identify direct impact multipliers and show how different UK regions benefit from HEI spending at varying degrees. 
  • Detect regional spillover effects to highlight how spending in one region can benefit other regions. 
  • Quantify multiplier effects in terms of gross value added and labour market outcomes.

Research team

  • Andre Carrascal-Incera, Research Fellow
  • Tasos Kitsos, Research Fellow
  • Diana Gutierrez-Posada, Research Fellow


Universities, Students and Regional Economies: A Symbiotic Relationship?
Regional Studies, 25 June 2021
Andre Carrascal-Incera, Tasos Kitsos, Diana Gutierrez-Posada


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Funder/client: N/A


Tasos KitsosProject Contact: Tasos Kitsos