Delivering Impact: A Comparison of Studies on the Economic Impact of Irish HEIs

What made the headline on the Irish Times education page this Wednesday was a report carried out by Viewforth Consulting on the economic, cultural and social impact of University College Dublin (UCD). Over the last few years, Viewforth Consulting has been a major partner working with Universities UK on the economic impact studies of UK universities. The Viewforth study on UCD is the second report the company has produced for Irish HEIs, with their pilot study on the social and economic impact of Dublin City University (DCU) published in 2014.

In this blogpost, I would like to compare the results from the Viewforth studies on the two institutions with the results from our Tionchar project.

Prior to any discussion of the results, it is crucial though, to acknowledge any differences between the methodologies adopted by the studies which would affect the final results on the economic impact.

In the Viewforth study on UCD, little has been said about the methodology adopted to undertake the analysis. Its DCU report, however, indicates that “the university’s impact on Ireland was modelled using a type II input-output model of Ireland”, with a footnote further explaining that “economic modelling of Irish impact was undertaken … using the national input output tables 2010 (CSO, 2014).”

Even so, there is a lack of details on the methodology in both reports which is well presented in the Viewforth studies on UK universities. It seems reasonable to assume that a similar, if not exactly the same, approach has been undertaken by the company to conduct analysis for universities in the UK and Ireland.

Therefore, both the Viewforth studies and our Tionchar project adopt a type II input-output model of Ireland and use the national input output tables 2010 which are the most recent ones for the country, making the comparison more straightforward.

Table 1 below shows some key indicators and results from the Viewforth and our own studies on DCU and UCD.

It should be stressed that the data shown in Table 1 does not include any impact from students, as in the Tionchar project we could not gather enough data from all Irish HEIs to calculate the economic impact of student expenditures. We, based on the studies on UK universities, assumed that student impact should be modest in comparison to the impact generated by the university and its employees. Nevertheless, according to the Viewforth study on UCD, its students generate an additional €448 million to the total economic impact of the university and its employees (€850 million), suggesting that students enrolled at UCD are a significant force of the university’s overall economic impact. The exclusion of student impact, although reducing the value of total economic output, should have no influence on the comparison between the two studies.

Table 1: Key indicators and results of the economic impact of DCU and UCD (excluding any student impact)

Tionchar

(2010/11)

Viewforth Consulting

(2012/13)

∆ 2010/11-2012/13
DCU
Income €175 million €148 million -€27 million
Expenditure €172 million €144 million -€28 million
Staff FTE 1209 1228 +19
Total output impact €719 million €278 million -€441 million
Output multiplier 4.18 1.88 -2.30
UCD
Income €411 million €421 million +€10 million
Expenditure €403 million n/a n/a
Staff FTE 2978 3340 +362
Total output impact €1702 €850 million -€852 million
Output multiplier 4.14 2.01 -2.13

In general, there are significant differences between the results from the two studies, with the Tionchar project reporting significantly higher results than the Viewforth studies. In the case of DCU, the Tionchar project found a output multiplier of 4.18, while the Viewforth reported that the output multiplier for DCU was just 1.88. A similar drop from 4.14 to 2.01 could be seen in the case of UCD.

One may wonder that if the difference was resulted by the fact that the two studies used institutional data in different years. Indeed, the Tionchar project used institutional data in the year of 2010/11, in order to make a direct linkage to the national input output tables 2010, while the Viewforth studies used more recent data for both DCU and UCD (2012/13).

This is a reasonable speculation, as Table 1 shows that the income of DCU decreased from €175 million to €148 million over the period, which could have a negative impact on its output impact. However, the income of UCD in fact increased from €411 million in 2010/11 to €421 million in 2012/13, making it more difficult to suggest what might be the underlying factor for the decrease of the output impact.

That said, both studies have confirmed that Irish HEIs, DCU and UCD more specifically, are significant driving forces of regional and national economy. Furthermore, as the Viewforth studies have shown, both institutions have substantially broader social and cultural impacts as well as the financial contribution they make to the economy.

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