The University of Otago contributed $829 million to the local economy last year, a yearly report evaluating its economic impact has found.

University director of planning and funding David Thomson, whose office put the report together, said a ''really rough estimate'' would put the impact at about 15% of Dunedin's GDP.

''Given that staff and students are roughly 20% of the population [and that] the university's the biggest employer in the city,'' he said.

The number was calculated based on estimated spending by students, staff and the university itself.

It also included ''the downstream effects of direct expenditure'', such as businesses needing to buy more product and hire more staff to account for the increased demand by students, staff and the university.

''This flow-on effect is estimated using standard economic multipliers, which are specific to the different cities and regions in which the university operates,'' he said.

The ''total value added'' to Dunedin by the university for 2014 was $9 million greater than the previous year, which Mr Thomson attributed to increases in expenditure on salaries and consumables, largely because of inflation.

The report put the University of Otago's total value added to Christchurch at $55.2 million, Wellington at $27.1 million, Invercargill at $2.2 million, and Auckland at $700,000.

Mr Thomson said he could not make ''exact comparisons'' between the University of Otago's economic impact on Dunedin and other universities' impact on their respective home cities, because ''not all universities do these reports, and if they do, they do not always release them''.

''We all know there is no other city in New Zealand where the economic impact of the university is going to be as large as it is for Dunedin,'' he said.

This was because university students and staff made up such a significant chunk of the city's population, an estimated 20%.

The report reflected ''what we mean to our home city, in an economic sense'' as well as ''the economic importance of having a really strong university in the city'' to Dunedin, he said.

The report acknowledged there were many other benefits more difficult to quantify, including ''knowledge transfers, human and social capital enhancement'', which ''fall outside the scope of this report''.

carla.green@odt.co.nz