Estimating the long-term economic impacts of the Spanish universities on the national economy

Universities are institutions whose activities have important economic and social impacts on their nearest surroundings. Most studies of the economic impact of universities analyze exclusively the impacts on the demand side, the effects on output, income and employment deriving from the universities' activity and their associated spending. This paper focuses on the universities' effects on the supply side of the economy, and analyzes the long term impacts of the universities on their local economy. Taking as a case study the Spanish University System, it proposes a methodology for estimating the effects of university activity on the Spanish economy in terms of its contribution to the increase of human capital, of salaries, of occupation, of technological capital and, finally, to the increase of income and the growth of the economy for the period 1989-2010. These effects are quantitative important and their impact on GDP of Spain is non-negligible.