Universities’ knowledge exchange efficiency and regional innovativeness: an empirical analysis

This study examines the relationship between universities’ knowledge exchange (KE) activities and regional innovation. Using panel data on UK universities from 2008 to 2019, we first estimate activity-specific stochastic frontier models to assess KE efficiency of both formal research commercialisation activities and informal academic engagement activities. We then employ Poisson Pseudo-Maximum Likelihood regression to examine the associations between universities’ KE efficiency and regional innovativeness. The results reveal substantial heterogeneity in universities’ KE efficiency across activities. Licensing and spin-off efficiency exhibit positive associations with regional innovation in both the main and two-year lag specifications, while consultancy efficiency is positively associated with regional innovation only in the two-year lag analysis. Patenting efficiency becomes statistically significant in the two-year lag analysis, whereas other KE activities generally exhibit no significant associations with regional innovativeness. These findings highlight the heterogeneous relationships between different KE activities and regional innovation. The study advances Regional Innovation Systems theory by demonstrating that KE efficiency, rather than KE volume, is an important factor associated with regional innovation outcomes. It also provides policy-relevant insights into the importance of prioritising high-efficiency KE channels and aligning KE strategies with regional absorptive capacity and industrial structure.