Do UK research and collaborations in R&I promote economic prosperity and leveling-up? An analysis of UKRI funding between 2004 and 2021

Abstract In this paper, we examine the extent to which public funding of research-related investments in the UK contributes to regional development and the fostering of regional convergence processes. This issue arises against the backdrop of the UK’s ‘Leveling Up’ agenda, in which there is an explicit mission to significantly increase the share of R&D public support in the regions outside of London and the Greater South East. Yet, whether such a policy is a realistic approach for driving regional development itself depends on how the impacts of publicly funded research play out across the economic development landscape. As such, our aim is to assess whether the funding logic and architecture over the last two decades has contributed to regional development and convergence or Leveling Up. To achieve this, we develop a novel multilevel structural equation modeling methodology applied to panel data constructed using social network analysis techniques. This novel methodology then enables us to uncover all the direct, indirect, and induced development effects operating both within and between regions, arising as a result of public funding. The analysis uses the UK Research and Innovation (UKRI) repository of funded projects between 2004 and May 2021, involving 25,122 projects and 44,406 participant firms and organizations, and accounting for approximately 32% of the total UK government-supported R&D over the period. The results from our analysis provide new evidence and insights into the regional development effects of different types of knowledge collaborations supported by publicly funded sources.