Draft for Presentation at the Annual Meeting of the Japan Section of
the Regional Science Association International
Wakayama, Japan
October 8-10, 2011

The University Research Park as a Microcluster:
Mapping Its Development and Anatomy(Working Draft, Version of 9‐9‐2011)

Lay James Gibson
Office of Arid Lands Studies
University of Arizona, USAljgibson@ag.arizona.edu
Vera Pavlakovich‐Kochi
Economic and Business Research Center
Eller College of Management
University of Arizona, USA
vkp@email.arizona.edu
Jaewon Lim
Office of University Research Parks
University of Arizona, USA
jlim@email.arizona.edu

ABSTRACT. University research parks facilitate co‐location of businesses within or in relative proximity
to the main campus. They provide a favorable environment for interaction among tenant firms, as well
as between firms and academia. Because of their physical size, employment base, support services,
export driven activities and their overall role in the region’s economy, university research parks can be
regarded as microclusters. In this paper we dissect and map the anatomy of a university research park
to demonstrate its dynamism and economic impact on the region’s economy through a mixture ofdifferent yet related activities. First we identify core activities that include technology companies andincubator based technology companies. These core activities are supported by park management
support organizations, park tenant support organizations, and community service support organizations.
Individual firms and agencies assigned to each of these categories are identified and employment isclassified as export driven or non‐export driven. Only the export component is used to estimate theindirect and induced employment in the metropolitan region that is dependent on park activity. The
methodology and results of this project will be particularly useful in conceptualization andoperationalization of economic impacts of university research parks on their local and regional
economies.
11. Introduction
Michael Porter’s 1990 Competitive Advantage of Nations has been widely credited for the
popularization of the concept of industry clusters, although the original observations on geographic
clustering of specialized companies can be traced way back to Alfred Marshall’s (1890) work on
industrial districts. Porter enhanced the basic idea of an industry cluster as a geographical concentrationof industries that increase their competitiveness through co‐location and collaboration. Moreover, heargued that the competitiveness of a region is based on the competitiveness of the industries, which inturn depends upon four key determinants, known as the “Diamond of Advantage:” factor conditions;home demand conditions; related and supporting industries; and industry strategy, structure andcompetitiveness (Porter 1990, 1998).
The concept of industry clusters found its two main applications in academic and applied research: one,as a strategy for regional economic development, and two, as an analytical tool in identifying existing
functional relationships between region’s industries (DeVol 2000, Doeringer and Terkla 1995, Held 1996).
Empirical studies on successful clusters have demonstrated the importance of co‐location andinteraction between research universities, suppliers of venture capital, adequate infrastructure andsupport services as well as active social networks as key drivers of innovation in a particular region(Markusen 1996, Porter 2000, Saxenian 1994). Because many of these region’s attributes can be
influenced by economic policy, cluster approach to regional economic development became widely
accepted strategy at state, regional and local levels. Consequently, countless high‐tech corridors,
technopoles, and science parks have sprung up to provide the environment believed to be conducive tothe development of targeted industries.

2

Geographic scope of clusters can range from a single city, to region, or a state. More than single
industries, clusters encompass an array of linked industries and other organizations, including suppliersof inputs, governmental and educational institutions, as well as trade associations and technical support(Porter 2000). By facilitating co‐location of businesses within or in relative vicinity of host campus,
university research parks provide a favorable environment for dense interaction among firms, andbetween firms and academia.

Conceptualizing university research park as an industry microcluster
A typical university research park resembles an industry cluster in terms of employment base, firm type,
and the overall role in the region’s economy. But, because university research parks are typicallyorganized within geographically limited area (physical boundaries of a park), encompass a smaller
number of firms, and are managed as a unit, they can be regarded as microclusters.
An obvious difference between a regional cluster and the university research park conceptualized as a
microcluster is in the process of identification of geographical and functional scope. Identification ofcluster “boundaries” – i.e., organizations that actually or potentially comprises a cluster – is primarily
based on the understanding of the linkages and complementarities across industries and institutions
that are most important to competition in a particular field. In case of university research parks, amicrocluster is easily identified as the firms located within the park’s boundaries.
One of the most interesting aspects of university research parks in economic development literature istheir role as drivers in local/regional economy. While academic debate in support of “pro” and “con”
arguments continues (Link & Scott, 2006 and 2007; Miyata, 2000), an increasing number of studies deal
with measurement of economic impacts of university research parks in specific communities, e.g.
economic impact study of the University City Science Center for greater Philadelphia (Economy League3

of Greater Philadelphia. 2009), Purdue Research Foundation Economic Impact Study (Thomas P. Miller
and Associates, 2011) and The University of Arizona Science and Tech Park Economic Impact Study (Lim,2010).
Conceptualizing the university research park as a microcluster allows for identification of types of firms
in terms of their primary role – as “core” and “supporting” firms. Furthermore, the firms can be
identified in terms of export‐ and non‐export employment, which is a crucial step in operationalization,measurement and understanding of economic impacts on local and regional economy that areassociated with the university research park.

Mapping Microcluster Anatomy
Literature has examined “anatomy” of clusters from different perspectives. Common approaches
include identifying product‐market relationships such as the buyer‐seller linkages and input of
supporting services.

These and other dimensions of clusters, such as industry collaboration andinformation flow, require a combination of quantitative and qualitative methods, from input‐output
models to surveys and interviews of key industry representatives. In practice, clusters are often
identified by local economic development leaders in collaboration with industry representatives andbusiness consultants.

An example of a localized cluster that has seen its reputation bloom is opticalsciences in Southern Arizona. The University of Arizona has been proud of its optical science capabilities
for decades. But the economic development implications of optical sciences were not widely recognizeduntil Business Week magazine called the region "Optics Valley" in 1992 because of the large
concentration of optics firms and organizations. In the years since the elements of the optics cluster,and its importance have been identified and analyzed by the Arizona Optics Industry Association, the4

Arizona Department of Commerce, Tucson Regional Economic Opportunities, Inc (TREO) and, of course,
the University of Arizona and its Office of Economic and Policy Analysis).
In case of the university research park, the geographic scope of the microcluster is determined by its
physical site, while the list of tenants determines a finite number of firms in the microcluster. The focusof the analysis is on the microcluster’s anatomy: identification of firms in terms of their function within
the microcluster and consequently, the nature of their impacts on the local/regional economy. Figure 1
shows a general composition of a typical university research park. On the left side are shown (a) Export‐oriented technology companies and (b) Incubator‐based technology companies; on the right side are (c)Park management support organizations, (d) Park tenant support organizations, and (e) Community
services support organizations. The Export‐oriented technology companies and the Incubator‐based
technology companies are primary park tenants whereas the three groups of support organizationsdeliver essential supporting services that make the park an effective microcluster.

Anatomy of the University Research Park
Whereas every science and technology park has distinctive attributes, most will follow the patternestablished by the University of Arizona's Research Park (UA Tech Park). Export oriented technology
companies and a variety of support organizations are identified (Figure 1). The UA Tech Park is
anchored by a dozen mostly established export oriented technology companies and 6 mostly embryonicincubator‐based export oriented technology companies.

Additionally there are three community

serving support organizations‐‐a high school, a community college, and a branch of the University of
Arizona. The Research Park per se is supported by 10 tenants including fire and police protection,
facilities and plant maintenance, food services, real estate services.

5

Exported Oriented
Technology
Companies

Park Management
SupportOrganizations

The University
Research Park
Micro Cluster

Park Tenant
SupportOrganizations

Incubator Based
Technology
Companies
Community
Service Support
Organizations
Source: Authors

Figure 1. The University Research Parks as a Microcluster: Mapping Its Anatomy

Finally there are 5 tenants that are university‐based and devoted to the promotion of university driven
economic development through improved access to an appropriate research park or through improved
access to information about innovation and technology or employee access to housing throughimproved mortgage access.

Indirect Primary Employment
The indirect primary concept is relatively obscure but it is useful for recognizing that not all export
employment is easily identified.

The concept was described in Blumenfeld's 1955 paper andsubsequently discussed and utilized by others including Gibson and Glenn (2000). There are numerous
examples many of which are tied to the concept of out‐sourcing. A straight‐forward example might bean electric generating plant which exports all of its electricity out of the region. Assume that this firmelects not to have in‐house workers to service it's plant but instead out sources plant maintenance to a6

specialist firm which co‐locates to provide the service. According to the indirect primary concept, thesemaintenance workers should be treated just like the electricity generating workers‐‐as export
employees.
At the UA Tech Park the task of identifying export and indirect and induced employment is usuallystraight forward. Export oriented technology companies and incubator companies are export driven
whereas the employees in community service support organizations are indirect or induced. On thesurface, firms and organizations providing park management services, park maintenance functions suchas landscape maintenance and other common area maintenance activities, and other park supporting
activities such as fire protection, janitorial services and cafeteria and dinning services would have
employees counted in the indirect and induced categories. But a careful look at the facts suggests thatthese activities are in fact export activities. The export firms in the park out source these activities tolocal firms and organizations; the cost of these activities is directly supported by the export firms
through their rent. These indirect primary employees may appear to be indirect or induced employees
but in fact they are export workers.

2. Results
The grand totals are impressive. The UA Tech Park supports 16,334 total employees in 36 tenant firms
and elsewhere in the Metropolitan Tucson Region (Table 1). Only 3 of the 36 tenants have no
indirect/induced impact. Put another way most of the firms in the Micro Cluster and almost all of theiremployees have a multiplier impact that eventually adds indirect and induced employment and, ofcourse, direct employment to the Tucson Region.

7

Table 1. Employment of UA TechPark Tenants and Impacts (Summary)Company & Organization by Activities
Export Oriented Technology Companies
Export Oriented Incubator Based Technology Companies
Export Oriented Companies Total
Community Servicing Support Organization
Park Management/Support Organizations
Park Tenant Support Organizations
Non‐Export Oriented Organizations Total

6,248
18
6,266
55
0
0
55

IndirectPrimary
Employment
0
0
0
0
164
9
173

Indirect/InducedEmployment
9,739
21
9,760
0
73
7
80

Total
Employment
Share (in %)97.88%
0.24%
98.11%
0.34%
1.45%
0.10%
1.89%

6,321
21

173
15

9,840
33*

100.00%
N/A

Total
Employment

DirectEmployment

15,98739
16,026
55
237
16
308

Grand Total
16,334
Total Number of Tenants (n)36Source: UA TechPark Annual Tenant Survey, September 2010
* Among total of 36 tenants, only 3 tenants do not have indirect/induced impact.

There are a dozen mature export oriented technology companies which account for almost 16,000
employees ‐ 6,248 export employees and another 9,739 indirect and induced employees through themultiplier process (Table 2). Of this total almost all export employees are in the 6 largest firms and thesame is true of the induced and indirect employment generated through the multiplier process. Amongthe better known tenants are Canon USA, Citi Group, IBM, NP Photonics, IBM System Storage Executive
Briefing Center, and Raytheon. Sectors which lead in generation of total employment include Aerospaceand Defense Related Research and Development, Electronic Component Development, Surveying and
Mapping Services, Credit Card Banks Services, and Data Processing Services. These are also the bulk of
the sectors yielding export employment.
Table 2. Employment Impact of Export Oriented Technology Companies by Activities
Company by Activities
Security and Other Technical Consulting Service
IT Marketing Service
Credit Card Banks Services
Surveying and Mapping Services
Electronic Component Development
Scientific Research & Technology Development
Data Processing Services
Aerospace & Defense Related R&D
Total
Number of Tenants (n)Multiplier
Source: UA TechPark Annual Tenant Survey, September 2010

Total
Employment
7
10
9,528
55
69
26
3,097
3,195
15,98712
2.56

8

Direct(Export)
Employment
4
6
2,520
28
37
12
1,532
2,109
6,248
12

IndirectPrimary
Employment
0
0
0
0
0
0
0
0
0
0

Indirect/InducedEmployment
3
4
7,008
27
32
14
1,565
1,086
9,739
12

Total
Employment
Share (in %)
0.04%
0.06%
59.60%
0.34%
0.43%
0.16%
19.37%
19.98%
100.00%N/AOne common difference between an industrial park with high‐tech tenants and a university based techpark is that the university park will more often than not have an incubator dedicated to "bringing along"developing technology companies (Table 3). These will sometimes be smaller companies with
speculative

products,

untested

production

models,andbusinessmodelswhich

are"underdevelopment." From time to time an incubator based firm will actually have export‐type
employment and, perhaps, a small number of indirect and inducted employees supported by the export
employment.
The UA Tech Park Incubator accommodates 6 tenants and 39 export, indirect and induced
employees. Whereas these numbers are modest they have the potential to grow two ways in the
future. Ideally one or more of these tenants will blossom and move from the Incubator into theresearch park per se. Alternatively, more developing companies coming from the Tucson Community,
the University of Arizona, or elsewhere will emerge to call the UA Tech Park home. The 6 firms currently
in the Park represent Bio, agricultural, and information technology development which seems
appropriate inasmuch as we are talking about a university based research park.
Table 3. Employment Impact of Export Oriented Incubator Based Technology Companies by Activities
Company by Activities
Bio Research & Technology Development
Ag. Research & Technology Development
IT Research & Technology Development
Total
Number of Tenants (n)Multiplier
Source: UA TechPark Annual Tenant Survey, September 2010

Total
Employment
33
2
4
39
6
2.17

Direct(Export)
Employment
15
1
2
18
6

IndirectPrimary
Employment
0
0
0
0
0

Indirect/InducedEmployment
18
1
2
21
6

Total
Employment
Share (in %)84.62%
5.13%
10.26%
100.00%N/A

It is not uncommon for university‐based research parks to have non‐core tenants. The UA Tech Park has
three community servicing support organizations with a total employment of 55 and has discussed
hosting other such tenants (Table 4). Tenants of these sorts might provide services for the larger
community or for Park tenants.
9

The three current tenants are the Vail Academy and High School, Pima Community College, and The
University of Arizona South. The three tenants are accommodated inasmuch as the park has, or had,excess capacity but there are other considerations too including the fact that the Park wishes to be agood neighbor. This is certainly the case of the Vail Academy when the Research Park ownership wastransferred from IBM to the State of Arizona the local (Vail) school district lost revenue from property
taxes. By providing space for the Academy and High School it proved temporary relief for the school
district. By providing space for the Community College and the University of Arizona South the Research
Park is providing educational access to residents of Southern Arizona and the Tucson Metropolitan areaand potential access to training and education programs to park tenants too.
Other non‐ core tenants that have been considered by the University of Arizona and have been locatedin other Research Parks elsewhere include hotel and conference facilities, a health club, and a golfcourse.
Table 4. Community Servicing Support Organization* by Activities
Organization by Activities

Total
Employment

Direct(non‐Export)
Employment
23
32
55
3

IndirectPrimary
Employment0000Indirect/InducedEmployment
0
0
0
0

Total
Employment
Share (in %)41.82%
58.18%
100.00%N/A

High School
23
Academies, College or University
32
Total
55
Number of Tenants (n)3Multiplier
N/A
Source: UA TechPark Annual Tenant Survey, September 2010
* Other types of Community Servicing Support Organization include Hotel & Conference Facilities, Health Club, Golf Course and etc.

Table 5 describes the 10 tenants that provide park management, park maintenance including landscapemaintenance and maintenance of common areas, and park supporting organizations including those
providing fire protection, janitorial services, and cafeteria/dinning services. These tenants have a totalof 164 indirect primary employees which are all directly supported by monthly rent payments. These
tenants support an additional 73 indirect and induced employees through the multiplier process in other
Tucson area firms.
10Table 5. Park Management/Support Organizations
Organization by Activities

Total
Employment

Park Management Organization
Park Maintenance Organization
Park Supporting Organization
Total
Number of Tenants (n)Multiplier
Source: UA TechPark Annual Tenant Survey, September 2010

96
74
67
237
10
1.45

Direct(non‐Export)
Employment
0
0
0
0
0

IndirectPrimary
Employment
61
55
48
164
10

Indirect/InducedEmployment
35
19
19
73
10

Total
Employment
Share (in %)40.51%
31.22%
28.27%
100.00%N/A

The 4 tenant support organizations described in Table 6 have 9 indirect primary employees and another7 indirect and induced employees which are supported through the multiplier process. Organizations
included here are the UA Office of University Research Parks, the Arizona Center for Innovation, theArizona Technology Council, and Meriwest Mortgage.

Table 6. Park Tenant Support Organizations
Organization by Activities

Total
Employment

Research Park Tenant Supporting Services
Total
Number of Tenants (n)Multiplier
Source: UA TechPark Annual Tenant Survey, September 2010

16
16
4
1.78

Direct(non‐Export)
Employment000IndirectPrimary
Employment
994Indirect/InducedEmployment
7
7
4

Total
Employment
Share (in %)100.00%100.00%N/A

The multiplier for the entire micro cluster is 2.6 (Table 7). Export oriented technology companies are
the largest contributors to this total but incubator based technology companies, park
management/support organizations and park tenant support organizations make a modest contribution
too.

Park management support/organizations and park tenant support organizations make theircontribution as indirect primary employers.

Community servicing support organizations do notcontribute to either export or multiplier employment but these organizations do contribute to the grand
total employment of 16,334.

11

Table 7. Multiplier by Activities

6,248
18
6,266
55
0
0
55

IndirectPrimary
Employment
0
0
0
0
164
9
173

Indirect/InducedEmployment
9,739
21
9,760
0
73
7
80

6,321
21

173
15

9,840
33*

Total
Employment

DirectEmployment

Export Oriented Technology Companies
Export Oriented Incubator Based Technology Companies
Export Oriented Companies Total
Community Servicing Support Organization
Park Management/Support Organizations
Park Tenant Support Organizations
Non‐Export Oriented Organizations Total

15,98739
16,026
55
237
16
308

Grand Total
Total Number of Tenants (n)Source: UA TechPark Annual Tenant Survey, September 2010

16,33436

Company & Organization by Activities

Multiplier
2.56
2.17
2.56
N/A*
1.45**
1.78**
1.46**
2.60***N/A* Multiplier for ‘Community Servicing Support Organization’ is not applicable since these organizations would have existed even without thepresence of UA Tech Park, i.e. there is no measurable indirect/induced employment of ‘Community Servicing Support Organization’. This is
purposely designed to avoid the double counting issue.
** Multipliers for ‘Park Management/Support Organizations’ and for ‘Park Tenant Support Organizations’ are calculated as the ratio of ‘Total
Employment’ to ‘Indirect Primary Employment’ since these activities’ direct employment is labeled as “Indirect Primary Employment” due tothe non‐export oriented characteristics of employment. The employment for these organizations would have not existed without the presenceof UA Tech Park.
*** Total Multiplier is calculated by excluding the number of employment in ‘Community Servicing Support Organization’ from both direct andtotal employment.

3. Conclusions
University Research Parks are complex entities. Using the UA Tech Park as an example we find that thisMicro Cluster has five distinct elements, 36 tenants, and 16,334 mostly export driven employees. The
bulk of the employees (15,987) are found in just a few large export‐oriented technology companies. But
smaller firms and organizations come into play, too. We employ the indirect primary concept to identify
employees that might initially appear to be indirect or induced but in fact are important export oriented
workers who contribute additional indirect and direct workers through the multiplier process.

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