The Impact of University-Firm Knowledge Links on Firm-level Productivity in Britain Richard Harris and Cher Li University of Glasgow University of Strathclyde This work contains statistical data from ONS which is Crown copyright and reproduced with the permission of the controller of HMSO and Queen's Printer for Scotland. The use of the ONS statistical data in this work does not imply the endorsement of the ONS in relation to the interpretation or analysis of the statistical data. This work uses research datasets which may not exactly reproduce National Statistics aggregates

Overview This study uses data from the UK Community Innovation Survey for 2007 to consider – (i) which firms engage with HEI’s in terms of both sourcing information and/or cooperating for innovation activities; and – (ii) whether involvement with HEI’s impacts on productivity (directly and indirectly through innovation activities). Also consider role of graduate employment in terms of (i) and (ii)

Percentage of enterprises sourcing knowledge from HEI’s in Great Britain 2006, by industry UK average = 22.8% 70.4

Percentage of enterprises sourcing knowledge from HEI’s in Great Britain 2006, by region and sector

Percentage of enterprises sourcing knowledge from HEI’s in Great Britain 2006, by size

Percentage of Workforce with degrees by certain activities in GB

Variable definitions used in CIS-ARD merged dataset for 2006 (cont.)

Conclusions Linkages with HEI’s for knowledge/cooperation is significant – on average nearly 23% of firms did so in 2006 – More so in production sector, larger enterprises, and NW, NE, SE and Scotland Some 17.9% of workforce were graduates in 2006 – More prevalent in innovative, internationalised firms In terms of use of HEI’s: – Exporters (+); foreign-owned (-) – Novel innovators (+); patenting (+); product innovators in manufacturing (-) – Those undertaking extramural R&D & cooperation (-) Less need for universities? – Higher absorptive capacity (+), especially external knowledge – When risks associated with innovation high (+); lack of qualified personnel (+)

In terms of impact on productivity: – UK-owned firms sourcing knowledge from HEI’s benefited – Foreign-owned firms in manufacturing sourcing knowledge from HEI’s had lower productivity Technology-sourcing FDI? – Firms with no graduates had lower productvity For those with graduates, inverted U-shaped relationship with productvity – Larger manufacturing firms more productive Some evidence that larger service sector firms have lower labour productivity