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Public Research, Local Knowledge Transfer, and Regional Development: Insights from a Structural VAR Model

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  • Jonathan Eberle
  • Thomas Brenner
  • Timo Mitze

Abstract

This article estimates the regional economic effects of public research activities. In order to identify the underlying transmission channels from knowledge creation to the regional environment, the empirical identification strategy goes beyond traditional partial effects analyses and studies the complex linkages between public research, innovativeness, and regional development on the basis of a structural vector autoregressive model. A particular focus is thereby set on assessing whether the effects of local public research activity differ by the type of research actors (universities, technical colleges, and public research institutes). The empirical results indicate that an increase in the volume of (public) third-party funding to technical colleges is associated with a rise in the regional investment and employment rate as well as the human capital stock. Increasing public third-party funding to both universities and technical colleges positively affects the regional patent activity, the employment rate, and per workforce output. In comparison, the empirical results provide limited evidence for regional economic effects stemming from an increase in local knowledge creation measured in terms of scientific publications. Here, only variations in the publication rate of public research institutes can be linked to positive private sector investment and employment effects.

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  • Jonathan Eberle & Thomas Brenner & Timo Mitze, 2020. "Public Research, Local Knowledge Transfer, and Regional Development: Insights from a Structural VAR Model," International Regional Science Review, , vol. 43(6), pages 555-586, November.
    • Handle: RePEc:sae:inrsre:v:43:y:2020:i:6:p:555-586
    DOI: 10.1177/0160017619863466
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    2. Luca Romagnoli & Paola Di Renzo & Luigi Mastronardi, 2022. "Modelling Income Drivers in Peripheral Municipalities: The Case of Italian Inner Areas," Sustainability, MDPI, vol. 14(22), pages 1-16, November.
    3. Uschi Backes-Gellner & Patrick Lehnert, 2021. "The Contribution of Vocational Education and Training to Innovation and Growth," Economics of Education Working Paper Series 0177, University of Zurich, Department of Business Administration (IBW).

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