This paper focuses on the regional economic impacts of US university research and science parks. Motivating this focus is the fact that the landscape for private-sector research is changing, and future research might well emphasize America’s “new geography of innovation.” Thus, university research and science parks might face, if they are not already doing so, pressure to retain current tenants and competition for future tenants. We find that only 11 of 146 research and science parks in the USA have, in the spirit of public accountability, conducted an economic impact study. One reason for the paucity of such studies is that universities are unfamiliar about how to conduct as well as how to interpret the findings from such a study. We offer an economic impact method for park administrators to follow if they proceed to document the regional economic impact of their park.
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See, Katz and Wagner (2014).
For example, STAR (Science, Technology and Advanced Research) Park at Texas State University, founded in 2011, is relying on the sale of US$10 million of Texas State University System Revenue Financing System Bonds for future growth. The innovation park campus at the University of Delaware’s advanced research campus is being developed through a US$20 million award from the National Institutes of Health plus US$5 million of support from the state.
This is an observation that many entrepreneurial universities face or will face (see Trequattrini et al. 2018 for Italian universities examples).
Skype communications was founded in 2003.
Link and Scott (2003) provide some descriptive information related to the impact of research and science parks on internal university activities. Nearly one half of the 29 provosts surveyed reported that as a result of their involvement with organizations in a science park, overall publications and patents by faculty had increased. Their study did not address potential changes in the locational advantages to park tenants on being juxtaposed to the university (see also Hobbs et al. 2017).
RTP’s strategic plan for future growth is based, in part, on state support for more capacity in existing road networks as well as the development of mass transit, in order to remain attractive to those research firms already within the park and to potential tenants that might either be considering another park or even an urban cluster involved with related technologies.
In a broad sense, our effort attempts to evaluation public engagement (Vargiu 2014).
Of course, it could be the case that a university conducted such a study but was displeased with its findings, and thus either denied doing so or was unresponsive to our inquires. Or, it could be the case that the park director conducted a study on his/her own, but the office of the provost was not aware of it. Our prior experience in collecting information about research parks from park directors, or even from AURP, was unsuccessful; thus, our focus in this study was on collecting information from the universities themselves.
The impact study of the Purdue Research Park states that it was done to commemorate the 50th anniversary of the park.
To illustrate this trend for a new park, see Howard and Link (2017).
It is our understanding that previous AURP surveys were directed to park managers or directors and not to university administrators.
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Hardin, J. (2013). “North Carolina’s Innovation Ecosystem: Focus on Research Parks,” presentation to the Committee on Science, Engineering, & Public Policy (COSEPUP) at the National Academy of Sciences, May 20.
Hobbs, K. G., Link, A. N., & Scott, J. T. (2017). The growth of U.S. science and technology parks: does proximity to a university matter? Annals of Regional Science, 59, 495–511.
Howard, E. S., & Link, A. N. (2017). An Oasis of knowledge: the early history of gateway university research park. Journal of the Knowledge Economy. https://doi.org/10.1007/s13132-017-0513-x.
Katz, B., & Wagner, J. (2014). “The rise of innovation districts: a new geography of innovation in America,” Brookings Institution Report.
Link, A. N., & Scott, J. T. (2003). U.S. science parks: The diffusion of an innovation and its effects on the academic missions of universities. International Journal of Industrial Organization, 21, 323–1356.
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Trequattrini, R., Lombardi, R., Lardo, A., & Cuozzo, B. (2018). The impact of entrepreneurial universities on regional growth: A local intellectual capital perspective. Journal of the Knowledge Economy, 9, 199–211.
Vargiu, A. (2014). Indicators for the evaluation of public engagement of higher education institutions. Journal of the Knowledge Economy, 5, 562–584.
We thank (alphabetical) Bernadette Grafton, Christopher Hayter, Sara Lawrence, Alan O’Connor, John Scott, and Ryan Smith for comments and suggestions on earlier versions of the paper.
This paper is based on a report prepared by Albert Link and Terri Shelton using Federal funds under award ED16HDQ3120043 from the Economic Development Administration, U.S. Department of Commerce. The statements, findings, conclusions, and recommendations are those of the authors and do not necessarily reflect the views of the Economic Development Administration or the U.S. Department of Commerce.
Appendix: Summary of Economic Impact Studies
Appendix: Summary of Economic Impact Studies
North Dakota State University
North Dakota State University Research & Technology Park
“NDSU Research Technology Park, Inc., 2010 Annual Report”
Economic Modeling Specialists Inc., 2010
“The NDSU Research & Technology Park [RTP] operates to enhance the investments in North Dakota State University by the citizens of North Dakota. Through partnerships with international, national and regional centers of excellence, high technology-based businesses, and the research community at NDSU, the Research & Technology Park works to achieve successful technology-based development and broaden the economic base of North Dakota.” https://www.ndsu.edu/research/newsroom/feature_stories2011/ report_shows_ndsu_research_tech_parks_economic_impact_on_region/
While Economic Modeling Specialists Inc.’s report is not available on-line or through the Park, it appears that the analysis was one of quantifying jobs, salaries, property income, and revenue to the state and local governments over the 2007–2010 period.
p. 4: “The 19 businesses located at the RTP account for 893 direct, on-site jobs and another 551 indirect, off-site jobs. … RTP industries pay out nearly $51 million in wages and account for another $23 million in indirect off-site wages as a result of multiplier effects. … RTP industries and offsite but linked businesses generate $28.4 million in property income in North Dakota. … RTP generates more than $10.9 million for state and local governments.”
Purdue Research Park
“Driving Today’s Economy: An Economic Impact Study of the Purdue Research Park Network” Thomas Miller and Associates, 2011
p. 5: “The primary mission [of the Park] during the early years was to serve as an attractive site for companies seeking a location to leverage the resources of Purdue University.” Since the early 1990s, the mission of the park has changed and now it is involved in (p. 5): “promoting technology-based economic development [and becoming a] primary vehicle for focusing the University’s economic development activities (both as a physical location and with a dedicated staff).”
Economic impact estimates came from the use of the Regional Input-Output Modeling System (RIMS II).
p. i: The Park’s impact has been: “$256 million investment in the Park facilities and infrastructure from 1999 to 2010; $1.3 billion annual impact for State of Indiana; $48 million contributed to State and local taxes; and $49 million in Federal research and development grants for small businesses brought to the State since 1987.”
University of Arkansas
Arkansas Research and Technology Park
“Economic Impact of the Arkansas Research and Technology Park”
University of Arkansas Center for Business and Economic Research, 2016
The Arkansas Research and Technology Park (ARTP) is operated by the University of Arkansas Technology Development Foundation. The mission of the foundation (p. 1): “is to stimulate the knowledge-based economy in Arkansas through partnerships that lead to new opportunities for learning and discovery, that build and retain a knowledge-based workforce and that spawns the development of new technologies to enrich the economic base in Arkansas.” The mission of the park is to assist (p. 1): “technology-based companies to be more efficient and have higher quality products by applying knowledge and techniques developed at the University.”
Using park tenants’ annual business expenditures and construction expenditures, an IMPLAN model was used to estimate the economic impact on the state.
The business expenditures of tenants and related construction expenditures exceeded US$216.9 million since 2003. These economic activities (p. 11) “have had a combined economic output impact of $575.9 on the state of Arkansas.”
University of Arizona
University of Arizona Tech Park
“The Economic Impact of the AU Tech Park”
VP Research & Consulting, LLC, 2015
p. v: The Park is built “upon the synergies among the faculty, administration, students and alumni; the tech parks; and the technology and business community to enhance the impact of UA research, intellectual property and technological innovation … [and to promote] synergistic relationships between the University, industry and the community.”
The IMPLAN model was used to calculate economic impacts at the county and state level.
In 2015 the overall county impact, including construction was US$1.5 billion. At the state level, the impact was US$1.7 billion.
University of Illinois at Urbana-Champaign
Research Park at the University of Illinois Urbana-Champaign
“An Economic Impact Report for the Research Park at the University of Illinois Urbana-Champaign”
Champaign County Regional Planning Committee, 2015
p. 1: “The Research Park at the University of Illinois provides an environment where technology-based businesses can work with faculty and students to take advantage of opportunities for collaborative research and easy access to University labs, equipment, and services. It was created by the University of Illinois in order to advance its economic development mission.”
Economic impacts estimated at the regional level from the IMPLAN model.
p. 7: In 2015, the “economic output from direct, indirect, and induced Research Park operations in East Central Illinois is $319 million.”
University of Missouri
University of Missouri Research Parks
“The Economic Impact of the University of Missouri’s Research Operations”
The Hanover Council, 2009
“The University of Missouri has a statewide network of 10 research parks and business incubators, each designed to help faculty, entrepreneurs and businesses collaborate to move innovative research to the marketplace.” The oldest and largest park is the Missouri Research Park (MRP). (https://www.umsystem.edu/ums/aa/umrpi/locations_list)
Unclear. Impacts seem to come from the St. Louis Regional Chamber & Growth Association.
p. 3: “MRP tenant operations are estimated to have a $786 million total impact on the St. Louis area economy, including the direct or indirect support of 4450 jobs.”
University of Nebraska
University of Nebraska Technology Park
The Annual Economic Impact of Firms Located at the University of Nebraska Technology Park”
Bureau of Business Research at the University of Nebraska, 2011
p. 1: “The mission of the University of Nebraska Technology Park is to enhance the transfer of technology from the University to the marketplace, foster interaction among technology-based businesses and with the University, provide an environment which fosters applied research and development of new technology-driven products or services and promotes technology-focused economic development in Nebraska.”
Direct impacts were estimated from (p. 2) “employment, salaries, and gross revenue from firms located at the Technology Park, and of graduates of the Technology Development Center.” Indirect impacts were calculated at the county level using multipliers from the IMPLAN model.
The total impact from Park businesses in 2010 was US$589 million.
University of Pennsylvania and Drexel University
University City Science Center
“University City Science Center: An Economic Catalyst for Greater Philadelphia”
Economy League of Greater Philadelphia and Econsult Solutions, Inc., 2016
The City Science Center’s mission statement is: “Our mission is to inspire and lead a diverse and inclusive community of innovation and entrepreneurship that nurtures and scales economic development through technology commercialization, business growth and civic engagement.” (https://www.sciencecenter.org/about-us)
IMPLAN model was used to estimate indirect impacts (e.g., spending on materials, equipment, and professional services) and induced impacts (e.g., spending that is supported by labor income paid to workers as a result of direct and indirect employment in industries, such as food, entertainment, housing, retail, and transportation).
p. 9: “Science Center incubated firms in greater Philadelphia drive $12.9 billion in annual economic activity.”
University of Wisconsin—Madison
University Research Park
“The Economic Contribution of the University Research Park”
NorthStar Economics, Inc., 2010
The Park’s mission is “to encourage technology development and commercialization that advances the economy and benefits research and related education programs at the University of Wisconsin – Madison.” (Strategic Plan at: http://universityresearchpark.org/about/strategic-plan/)
The report does not mention the IMPLAN model, but the impact estimates are based on direct and indirect effects from the use of multipliers.
Park activity generated in 2010 over US$826 million in economic activity statewide; in Dane County, it was US$588 million and in the rest of the state it was US$238 million.
Arizona State University
Arizona State Research Park
“The Economic Impact of the Arizona State University Research Park, 2016”
Center for Competitiveness and Prosperity Research at Arizona State University, 2016
“ASU Research Park’s mission is to strengthen ties between Arizona State University and industry, and to contribute to the Valley’s economic development.” (https://cfo.asu.edu/article/20160406-asu-research-park-board-directors-welcomes-three-new-members)
Economic estimates were made using the IMPLAN model
The total economic impact in 2016 was US$1.4 billion
Virginia Commonwealth University
Virginia BioTechnology Research Park
“The Estimated Cumulative Benefit of the Virginia Biotechnology Research Park”
Virginia Economic Development Partnership, 2010
The mission of The Virginia Biotechnology Research Park is to be “a technology center dedicated to fostering development of Virginia’s biosciences industry through technology transfer, new business formation, expansion of existing businesses and business attraction.” (https://www.biospace.com/employer/506781/virginia-biotechnology-research-park/)
IMPLAN model used.
The Park’s economic impact on the City of Richmond was US$598 million; and for the Greater Richmond area was US$846 million.
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Hobbs, K.G., Link, A.N. & Shelton, T.L. The Regional Economic Impacts of University Research and Science Parks. J Knowl Econ 11, 42–56 (2020). https://doi.org/10.1007/s13132-018-0566-5