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We examine the determinants of university involvement in knowledge transfer activities, focusing on the value of external services provided by higher education institutions. Data come from 164 universities in the UK and are drawn from the HE Business and Community Interaction Survey (HE-BCI), with a variety of university- and region- specific explanatory variables grafted onto the data from other official sources. The production function for such external services is estimated using the appropriate stochastic frontier methods, and unobserved heterogeneity across institutions of higher education is accommodated by adopting a latent class framework for the modelling. We find strong effects of scale and of research orientation on the level of knowledge transfer. There are, however, two distinct latent classes of higher education institutions, and these differ especially in terms of how external service provision responds to subject specialization of universities and to economic conditions in the region. Research-intensive universities are concentrated in one of the latent classes and, in these institutions, the provision of external services appears to be highly efficient, while in the second latent class there is greater variation in the efficiency of universities.

This article deals with the relationships between the performance of higher education systems (HESs) and their potential determinants. The research employed data relating to twenty-nine European countries, within a time span of 15 years. The empirical work is based on a conceptual framework that has been tested through Structural Equation Modelling. The data was selected from a novel data set that we have built by gathering HES indicators from the major international databases. Among the more noteworthy results, we found no statistically significant correlation between graduation rates and research performance. Additionally, we found a moderate effect of public expenditure on HES performance. The article addresses the issue of the lack of a comprehensive set of systemic indicators for HES performance, providing a holistic picture of the relationship between HES determinants and performance, which, in turn, could help to provide an adequate evaluation of the policies in the field of higher education.