Urban engagement is not a peripheral endeavor, but rather an integral part of Northeastern’s teaching and research mission, said President Joseph Aoun during a recent panel discussion with Boston University President Robert Brown and Tufts University President Lawrence Bacow on the role universities play in the economic development of Greater Boston.

The panel, “Universities as Economic Drivers,” was moderated by Paul Grogan, president and CEO of the Boston Foundation and held at the Boston Federal Reserve Bank. The panelists addressed members of the Urban Land Institute, a nonprofit research and education organization dedicated to creating and sustaining thriving communities, and others interested in real estate development.

“There is no question that when people think of Boston, they think first about higher education,” said Grogan. “It is the distinctive marker of our community. Higher education is not only an enormous industry, it underlies most of our other vital industries such as healthcare, travel and tourism.”

Aoun underscored that urban engagement should “not be thought of as an extracurricular activity.” He mentioned that last year Northeastern students performed more than 110,000 hours of community service, but stressed that he prefers to think of this as “service learning.”

“Urban engagement is part of the educational process,” he said. “You cannot ask students to begin acting as engaged citizens when they leave the university; you have to do it while they are students.”

The panelists discussed the highly competitive nature of modern higher education and how this competition might impact urban engagement. Competition between universities for the best amenities and the most qualified students, faculty and staff heighten costs, Bacow said.

“In most other industries, competition drives cost down,” he said. “In ours, competition drives costs up. We know how to make education cheaper at our institution. It’s called larger classes, it’s called less hands-on learning, it’s called simpler facilities, and it’s called less opportunities in terms of student life.”

The university leaders agreed on the importance of forging important relationships with community organizations, but also spoke of current budgetary pressures. “Every dollar I give someone is a tuition dollar I charge someone else,” Brown said. “So this tension between the cost of higher education at our institution and what we do internally or externally are directly linked by that fact.”

Northeastern provides several direct benefits and resources to the community, Aoun said. Each year, the University provides more than $10 million in scholarship money for Boston residents who come to Northeastern. He cited Northeastern’s new Foundation Year program, which provides Boston Public Schoolgraduates three semesters of university study to increase their chances of graduating from college. He also mentioned relevant university research—such as projects on transportation and housing—and the fact that universities produce students and ideas that create economic growth.

“We have to look at it in terms of the diversity of what’s being done,” Aoun said. “We should celebrate this partnership between the city and its institutions.”