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University decentralization as regional policy: the Swedish experiment

  • Roland Andersson
  • John M. Quigley
  • Mats Wilhelmson

During the past 15 years, Swedish higher education policy has emphasized the spatial decentralization of post-secondary education. We investigate the economic effects of this decentralization policy on productivity and output per worker. We rely upon a 14-year panel of output and employment for Sweden's 285 municipalities, together with data on the location of university-based researchers and students, to estimate the effects of exogenous changes in educational policy upon regional development. We find important and significant effects of this policy upon the average productivity of workers, suggesting that the economic effects of the decentralization on regional development are economically important. We also find evidence of highly significant, but extremely localized, externalities in productivity. This is consistent with recent findings (e.g., Rosenthal and Strange, 2003) on agglomeration in 'knowledge industries.' Copyright 2004, Oxford University Press.

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Article provided by Oxford University Press in its journal Journal of Economic Geography.

Volume (Year): 4 (2004)
Issue (Month): 4 (August)
Pages: 371-388

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Handle: RePEc:oup:jecgeo:v:4:y:2004:i:4:p:371-388
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  1. James E. Rauch, 1991. "Productivity Gains From Geographic Concentration of human Capital: Evidence From the Cities," NBER Working Papers 3905, National Bureau of Economic Research, Inc.
  2. Paul Krugman, 1990. "Increasing Returns and Economic Geography," NBER Working Papers 3275, National Bureau of Economic Research, Inc.
  3. Romer, Paul M, 1986. "Increasing Returns and Long-run Growth," Journal of Political Economy, University of Chicago Press, vol. 94(5), pages 1002-37, October.
  4. Jaffe, Adam B, 1989. "Real Effects of Academic Research," American Economic Review, American Economic Association, vol. 79(5), pages 957-70, December.
  5. James D. Adams, 2001. "Comparative Localization of Academic and Industrial Spillovers," NBER Working Papers 8292, National Bureau of Economic Research, Inc.
  6. Jaffe, Adam B & Trajtenberg, Manuel & Henderson, Rebecca, 1993. "Geographic Localization of Knowledge Spillovers as Evidenced by Patent Citations," The Quarterly Journal of Economics, MIT Press, vol. 108(3), pages 577-98, August.
  7. Rosenthal, Stuart S. & Strange, William C., 2001. "The Determinants of Agglomeration," Journal of Urban Economics, Elsevier, vol. 50(2), pages 191-229, September.
  8. Audretsch, David B & Feldman, Maryann P, 1996. "R&D Spillovers and the Geography of Innovation and Production," American Economic Review, American Economic Association, vol. 86(3), pages 630-40, June.
  9. Lucas, Robert Jr., 1988. "On the mechanics of economic development," Journal of Monetary Economics, Elsevier, vol. 22(1), pages 3-42, July.
  10. Anselin, Luc & Varga, Attila & Acs, Zoltan, 1997. "Local Geographic Spillovers between University Research and High Technology Innovations," Journal of Urban Economics, Elsevier, vol. 42(3), pages 422-448, November.
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