Harvard University, following the lead of other educational institutions around the nation, is trying to improve relations with the communities that surround its campus by taking a symbolic first step of issuing a report detailing the university's nearly $2 billion-a-year impact on the local economy.

It is an unprecedented move for the country's oldest and richest university, whose reputation for academic excellence on campus has been matched historically only by a reputation for hubris outside its high brick walls. In recent years, while other colleges nationwide demonstrated a newfound commitment to the communities surrounding their campuses, Harvard rarely trumpeted civic pride. And in occasional reports, the university made mention of its positive economic contributions only in passing.

But faced with a tight real estate market and federal funding cuts that threaten university research and its affiliated teaching hospitals here and elsewhere, Harvard officials say it is necessary to expand their community connections to leverage resources in the college capital of the United States and enhance their competitive edge in a knowledge-based economy.

"Investing in the Future," a 70-page report presented late last month to the Greater Boston Chamber of Commerce by Harvard President Neil L. Rudenstine, outlines the university's contributions in employment, spending, research, community service and intellectual talent.

"Reaching out to make ourselves a more active participant and trying to figure out how to do it cooperatively and collaboratively seems to me to be incredibly important at this juncture in history," said Rudenstine, who spoke of finding "common ground" and praised Boston's "enlightened, progressive, and strong city government" in his remarks to the chamber. "Right now, there is no alternative but to work together."

An increasing number of institutions of higher learning--from Trinity College in Hartford to the University of Southern California in Los Angeles--have reached the same conclusion. More than 20 New Hampshire colleges and universities, including Dartmouth College, recently pledged a deeper commitment to civic responsibility by encouraging their students to register and vote and to be active in the communities where they live. Yale University, which has provided incentives for faculty and student home ownership in New Haven, assembled managers from the city and Yale to participate in its Management Training Institute this month.

And the University of Pennsylvania, which once demolished residences in West Philadelphia to build high-rises, is helping to build a public elementary school and working with other area institutions to improve neighborhood safety.

The Clinton administration also has awarded about $90 million in grants over the past five years for community-based collaborations through the Department of Housing and Urban Development's Office for University Partnerships.

"Every college or university is in some conversation with its host municipality, and they are asking two questions: How do we benefit each other, and how can we overcome historic tensions?" said David Warren, president of the Washington-based National Association of Independent Colleges and Universities. "I sense a much stronger collective sense of joint endeavor."

Some observers here say that Harvard, which has a $14.4 billion endowment and owns more than 440 acres of property here and in Cambridge, can afford to make generous overtures after exceeding its $2.1 billion goal in a fund-raising campaign. Residents of the Allston section of Boston recall how just two years ago they were shocked to learn the university had secretly acquired 52 acres of property in their neighborhood, prompting Boston Mayor Thomas M. Menino to accuse Harvard of "the highest level of arrogance seen in our city in many years."

These days, a shift in deed as well as tone appears to be underway, Menino and others said. Harvard, which is discussing moving more of its operations here from Cambridge, recently announced that it will build 288 units of graduate student housing and pay the city of Boston $40 million in lieu of taxes over the next 20 years--an overall increase of $12 million over the previous payment plan. And on Sept. 28, university officials formally handed over a low-income housing development in the city's Mission Hill neighborhood to its tenants' association for $66 million.

"In the past, Harvard was a university that stood alone," Menino said. Now, "if we are able to ask them to help us solve some of our urban problems, it's very advantageous for the city. I think Harvard has come of age."

The recently released report posits Harvard as an economic as well as academic entity, based on figures from the 1997-98 school year. Among its findings: Boston area residents make up the bulk of Harvard's $661 million employee payroll. Harvard purchased about $338 million in city-supplied goods and services. And the university paid more than $80 million to local contractors for construction work.

The report adds that Harvard students and visitors spent $220 million in the area that same year.

By comparison, Boston University, with an endowment less than one-twentieth the size of Harvard's, had a much larger economic impact. Boston University paid about $443 million to employees living in greater Boston and purchased nearly $541 million in area goods and services. The university generated at least $2.2 billion in spending statewide during the previous fiscal year.

"What you're seeing is a broad effort to really make it clear that Harvard has an enormous stake in the quality of life in Boston and Cambridge," said Paul S. Grogan, a university vice president and former community redevelopment agency head who has led Harvard's initiative. "We're doing more and making it more visible."

The University Weighs In

Harvard brings in most of its revenue from outside Boston and spends most of its money locally.

Source of Harvard revenue, 1997-98

In Boston area: 12%

Outside Boston area: 88%

Location of Harvard spending, 1997-98

In Boston area: 71%

Outside Boston area: 29%

Harvard's nearly 20,000 students spend millions throughout the school year.

Estimated living expenses, 1997-98*

Students Expenses Spending

Undergraduate 6,630 $2,100 $13,923,000

Graduate 11,967 $12,000 $129,396,000

Total 18,597 $143,319,000

*Excluding summer school

SOURCE: "Investing in the Future," Harvard University

CAPTION: Boston Mayor Thomas Menino, left, and Harvard President Neil Rudenstine talk at a ceremony last month marking the sale of a university housing project to its tenants, another sign of eased tensions between the city and the school.