Higher education and economic growth: A longitudinal study of European regions 2000-2017

This paper investigates the impact of regional higher education systems (HESs) on economic growth, based upon 284 European regions (NUTS 2) over an 18-year period (from 2000 to 2017). The empirical framework specifically models the heterogeneity of the HESs by including indicators on university concentration, on the size of the HES and on HES performance and other important factors. The analysis is based on a novel and integrated dataset, created by collecting and combining indicators from different data sources (Eurostat, OECD, WHED and InCites). The results reveal that an increase in number of universities in a region is conducive to stronger economic growth within that region. The quality of research and a specialisation in STEM subjects are the primary drivers through which universities impact positively on the regions' economic development.