John Daley and Annette Lancy in The Conversation on Wednesday suggested that regional universities are failing to have economic impacts, and that investment in regional universities is largely wasted in efforts to stimulate regional development.

I read their report with some interest earlier this week as an economist who has previously written about the economic benefits of regional universities. I also have some ‘skin in the game' because I have spent all my life in central Queensland, much of it as a cattle producer, and have worked for Central Queensland University for more than 20 years.

There are many parts of Daly and Lancy's analysis that I agree with, as I suspect most others do.  Who doesn't think that governments waste money, or that many regional development initiatives are really pork barrelling exercises disguised in glitzy economic wrapping paper? Who doesn't agree that there are more returns to be generated by investing in rapidly growing regions rather than the slowing ones?

Where their analysis is most surprising, and most flawed, is in relation to their arguments that regional universities don't make economic contributions. There are at least three major issues that can be identified with the analysis they present.

The first problem is that they appear to confound regional universities with inland universities. They make the point very nicely that the highest annual rates of population growth in Australia are in capital city satellites (2.4% ) and coastal cities (2.0%), outstripping capital cities (2.0%) and inland cities (1.5%). Yet most regional universities are located in the coastal cities and capital city satellites. I can only identify two regional universities, Charles Sturt and New England, which properly can be classified as based in inland cities (Daley and Lancy categorise the universities of Ballarat and Southern Queensland (Toowoomba) in capital city satellites). By deduction, the other regional universities in Australia are servicing those population groups that are growing faster than capital cities.

The second problem is with their comparison of private sector growth rates between cities that have universities based in them, and cities that don't. They identify that cities such as the Gold Coast-Tweed (QLD/NSW), Sunshine Coast (QLD) and Mandurah (WA) don't have universities based in them but have much higher growth rates than ‘University' cities such as Canberra, Wollongong, Toowoomba, Ballarat and Rockhampton. Let me just identify two issues with this analysis. First, regional economies are complex and driven by a range of factors and sectors, so confounding effects overwhelm the very small numbers of comparisons that are given. For each of the example cities that are nominated, a range of non-education sector drivers can be identified to explain why growth rates are higher or lower than other cities. Second, the professional workforce in Australia is very mobile, particularly between big cities and close centres like the Gold Coast and Sunshine Coast. At least two million people change jobs every year in Australia, and a part of the employment churn involves relocations between areas. Just because some capital city satellites have higher growth rates does not mean that they are not drawing on highly educated professionals.