The Differential Economic Effects of Private Universities in Urban and Rural Regions

This paper investigates whether the local economic effects of niche university actors depend on regional context. Focusing on private university campuses in Germany, it exploits their staggered foundation between 1990 and 2020 and estimates their effects using a conditional staggered difference-in-differences design at the postal code level. Campus foundations raise local economic activity, but only gradually, with effects becoming statistically significant after about ten years. The effects are strongest in rural and intermediate regions, while urban regions show no significant effects. This pattern supports the argument that niche universities have greater potential to become significant actors in institutionally thinner rural regions.

Krieger, Bastian, Henning Kroll, Torben Schubert, Linus Strecke und Cecilia Chavez (2026), The Differential Economic Effects of Private Universities in Urban and Rural Regions, ZEW Discussion Paper Nr. 26-020, Mannheim.