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DePaul University Via Sapientiae College of Business Theses and Dissertations Driehaus College of Business Spring 5-15-2018 University internationalization as a method of human capital development Kari Costello DePaul University, kcostel7@depaul.edu Follow this and additional works at: https://via.edu/business_etd Part of the International and Comparative Education Commons Recommended Citation Costello, Kari, "University internationalization as a method of human capital development" (2018). College of Business Theses and Dissertations.edu/business_etd/4 This Dissertation is brought to you for free and open access by the Driehaus College of Business at Via Sapientiae. It has been accepted for inclusion in College of Business Theses and Dissertations by an authorized administrator of Via Sapientiae. For more information, please contact digitalservices@depaul.

Running Header: UNIVERSITY INTERNATIONALIZATION 1 University Internationalization as a Method of Human Capital Development Kari Costello DePaul University DISSERTATION Submitted as partial fulfillment of the requirements for the degree of Doctor of Business Administration Kelstadt Graduate School of Business DePaul University 2018 DEFENSE COMMITTEE: Dr. Zafar Iqbal, Chair and Advisor Dr. Grace Lemmon Dr. Albert Muniz UNIVERSITY INTERNATIONALIZATION 2 Acknowledgements I would like to thank my lucky stars for giving me the best possible dissertation advisor and committee I could have asked for.

First, I wish to thank Dr. Zafar Iqbal, who helped me shape smartphone snapshots of ‘whiteboard spaghetti’ into a focused research question and eventually a defensible dissertation. Thank you for having vision when I did not, for providing clarity during my moments of confusion and coaching me across the finish line. I would also like to thank Dr.

Grace Lemmon, for being my 24/7 data lifeline and a continuous source of encouragement and positive energy. I did not think it was possible to pass, let alone feel enthusiastic about statistics and data analysis, but you made me see the light. I would also like to thank Dr. Al Muniz for teaching me that even though qualitative research methods can be labor intensive and tedious, they can also pay off tremendously, especially when you find those golden nuggets of truth.

The three of you were the ultimate academic dream team! Thank you for making this such a rewarding experience. Embarking on a three-year academic journey would not have been possible without the understanding, support and flexibility from those at work and at home. To my incredible boss and mentor, Dr. GianMario Besana, thank you for encouraging me to take on this challenge and for giving me space to spread my wings.

To my amazing husband and partner, Jason, thank you for holding my hand through this journey. Without hesitation or complaint, you stepped up and kept our family, house and life in order while I was in class, working or otherwise preoccupied. Not all superheroes wear capes! Finally, thank you to my beautiful, precocious, and delightful daughter Mia. Thank you for your cartwheels, hugs of encouragement and your toothless grin, which remind me that every day and every experience is a gift to be cherished.

UNIVERSITY INTERNATIONALIZATION 3 Table of Contents Acknowledgements. 2 Table of Contents. 3 List of Tables. 4 List of Figures.

61 APPENDIX A: Interview Methodology. 65 APPENDIX B: Interview Participants. 67 APPENDIX C: Survey Participant Profile. 68 APPENDIX D: Correlation Table.

69 APPENDIX E: Moderation Tables. 70 APPENDIX F: Survey Instrument. 74 UNIVERSITY INTERNATIONALIZATION 4 List of Tables Table 1: Measurement.27 Table 2: Survey Items .35 Table 3: Results of Hypotheses Testing.39 Table 4: Results of MANOVA (Students Only) .42 Table 5: Results of Further Hypotheses Testing (Students Only) .43 UNIVERSITY INTERNATIONALIZATION 5 List of Figures Figure 1: Proposed Theoretical Model .23 Figure 2: Intercultural Interactions and Engagement.40 Figure 3: Study Abroad and Institutional Commitment .41 Figure 4: Intercultural Interaction and Engagement (Students Only) .44 Figure 5: Intercultural Interaction and Engagement (Students Only) .45 Figure 6: Study Abroad and Institutional Commitment (Students Only) .46 UNIVERSITY INTERNATIONALIZATION 6 Abstract University internationalization involves a complex set of initiatives that provide students and faculty with opportunities to gain global perspectives and intercultural skills which can enhance human capital. Typically, these activities are evaluated in terms of participation numbers or financial costs.

But little attention is paid to understanding the intangible benefits of internationalization activities. This study aims to understand the benefits of international educational experiences and determine whether they can be considered investments from a human capital perspective. This mixed methods study involved qualitative interviews and a quantitative survey of over 400 students and faculty at a university. The results demonstrated that some methods of internationalization, such as study abroad and international or intercultural coursework, had significant and positive relationships with benefits such as engagement and institutional commitment.

However, other experiences such as having interactions with individuals from different cultural backgrounds, showed significant but negative relationships with expected benefits such as engagement and professional development. This study provides empirical evidence to help university leaders in determining the best ways to invest limited resources in internationalization activities. Further research is needed to more clearly understand why some methods of internationalization are better than others in developing student and faculty, from a human capital perspective. Keywords: university internationalization, human capital development UNIVERSITY INTERNATIONALIZATION 7 Introduction University internationalization has become an explicit, articulated, institution-wide strategic priority (Gao, 2015).

However, it faces increasing challenges due to limited resources and a changing political landscape. Internationalization of higher education is commonly understood to mean the process of integrating an international/intercultural dimension into the teaching, research and service elements of an institution (Altbach & Knight, 2007). The 2006 International Association of Universities (IAU)1 survey indicated that 73 percent of the participating higher education institutions assigned high priority to internationalization, 23 percent medium priority and only 2 percent low priority (de Wit, 2009). To operate successfully in the increasingly globalized environment, academic institutions must continue to foster a commitment to internationalization and make significant efforts to integrate the international dimension into key areas of operation (Gao, 2015).

Institutional challenges in the internationalization of higher education consist of a lack of financial resources, scarcity of human resources, and educational structure (Zolfaghari, Sabran, & Zolfaghari, 2009). Internationalization strategies are clearly important for universities; however, limited institutional resources and the current political climate pose significant challenges to its successful implementation. As the higher education industry becomes more competitive and university resources become scarcer, securing resources for internationalization efforts will become increasingly difficult. Leslie, Slaughter, Taylor, and Zhang, (2012) based on resource dependence theory, found that institutions facing budget cuts tend to engage into academic capitalism to search for 1 Knight, Jane, 2005, IAU Global Survey on Internationalization of Higher Education, reported in Internationalization of Higher Education: New Directions, New Challenges, retrieved from /https://www.net/IMG/pdf/key_results_2005_1.pdf/ UNIVERSITY INTERNATIONALIZATION 8 supplementary revenue streams in the market (Bugandwa Mungu Akonkwa, 2009).

Moreover, with an increasingly tense political climate within the U. and growing nationalistic agenda, critics of internationalization insist that the focus should be on the U. This leads to even higher competition for resources within university budgets and an even more pronounced need to demonstrate the benefits and payoffs of internationalization efforts. Without more conclusive evidence of the payoffs of internationalization, securing resources for these activities will become increasingly difficult.

The resources that are allocated to university internationalization are spread across a broad array of activities and it is difficult to know which of these activities has the greatest returns. While there is no agreed upon definition, Elkin, Devjee, and Farnsworth (2005) suggest, university internationalization should “aim to create values, beliefs and intellectual insights in which both domestic and international students and faculty participates and benefit equally. They should develop global perspectives, international and cultural and ethical sensitivity along with useful knowledge, skills and attitudes for the globalized market place”. Rationale for university internationalization vary by institution but may include desired benefits such as increasing global awareness of students, improving the quality of teaching and learning, strengthening research and institutional knowledge, enhanced prestige for the institution, and diversified and increased revenue potential (Seeber, Cattaneo, Huisman, & Paleari, 2016).

colleges use international programs to provide international and cross-cultural perspectives for their students and to enhance their curricula (Hayward & Siaya, 2001). With such a wide array of internationalization goals and methods and limited resources to support them all, it is difficult to know which investments make the biggest impact. Most of the focus to-date has been on understanding how university internationalization UNIVERSITY INTERNATIONALIZATION 9 efforts impact the whole university or institution, which can be considered the macro level. For example, Elkin, Farnsworth, and Templer, (2008) developed an 11-dimension model to help universities measure their ideal versus current performance in internationalization efforts focused on the macro level and based on opinions of university leadership.

And Ayoubi and Massoud, (2007) examined the international achievements versus strategic intent at 117 universities and developed a matrix to compare international mission to international action. Similarly, in a study by Delgado-Marquez, Escudero-Torres, and Hurtado-Torres (2013), university internationalization (as measured by percentages of international students and staff) was established as a predictor of institutional reputation for the top 50 universities in the World Reputation Ranking (2011), (Delgado-Marquez et al, 2013). While these studies help define various aspects of internationalization from the macro view, they do not help us understand how international efforts may benefit the individual faculty and students who are involved in them, the micro view. Perhaps, the benefits of internationalization need to be assessed differently.

Because a university is the sum of its parts, perhaps the best way to understand real benefits is to study the impact at the individual level and how those benefits also affects the institution. Kotler and Fox (1995) stated that the institution is the sum of opinions, ideas, and impressions that prospective students have of the institution and their opinion about the image of the institution is formed from word of mouth, past experience, and marketing activities of the institution (Ivy, 2001) as cited by María Cubillo, Sánchez, and Cerviño, (2006). This study will investigate the micro view, the benefits of internationalization activities to individual faculty and student participants, and how those benefits also impact the institution. The returns on university internationalization efforts are difficult to measure and are UNIVERSITY INTERNATIONALIZATION 10 largely assumed.

While traditional internationalization efforts may enhance the competitiveness, prestige, and strategic alliances of a university, it is rarely a profit-making activity (Altbach & Knight, 2007). It is also challenging to quantify the true costs and returns associated with university internationalization activities, because the greatest returns are intangible benefits. Because return on investment is typically understood by evaluating the financial inputs and outputs of a particular activity, attempting to apply a return on investment analysis on university internationalization would not fully capture the intangible returns. Perhaps, a better foundation from which to investigate these returns is to leverage human capital theory to assess how international education activities can serve as a method of human capital development.

My research interest lies in understanding how university internationalization efforts serve as a method of human capital development, in delivering benefits to the individual participants (faculty and students) and how those benefits affect the university that invested in those efforts. Human capital, defined by Theodore Schultz as “the knowledge and skills that people acquire through education and training as being a form of capital, and this capital is a product of deliberate investment that yields returns” (Nafukho et al. 11) as cited by Zula and Chermack, (2007). Human capital theory provides solid grounding for assessing the benefits of internationalization activities to individual participants and how those benefits affect the universities that invest in them.

Literature Review Theoretical Foundation Gary Becker (1975) defined the basic notion of human capital as skills acquisition, and that skills acquisition can be achieved through education and training. Human capital UNIVERSITY INTERNATIONALIZATION 11 development benefits the organization from a productivity standpoint, and benefits the individual workers with improved performance (Bae & Patterson, 2014).