Social capital matters for a sustainable South Korea

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South Korea is facing a number of challenges. Not unlike other advanced economies in Asia, the country is confronted with a declining working-age population, reduction in birth rates, and risk of long-term stagnation.

A team of Stanford researchers at Stanford’s Shorenstein Asia-Pacific Research Center (APARC), in collaboration with other scholars from around the world, is increasingly thinking about those challenges and is working on a number of research initiatives that explore potential solutions in leveraging benefits from globalization.

The researchers propose that Korea can extract value from two major movements of people – outflows of its own population (diaspora) and inflows of foreigners (immigrants and visitors), all of whom hold the capacity to build social capital – a network of people who have established trust and in turn spread ideas and resources across borders.

Engaging diaspora

Emigration is traditionally viewed as a loss of human capital – ‘brain drain’ – movement of skills out of one country and into another, but Stanford professor Gi-Wook Shin and Koret Fellow Joon Nak Choi support an alternative view of outward flows of citizens.

Shin and Choi suggest that people who leave their countries of origin but never return can still provide value to their home country through ‘brain linkage,’ which advocates that there is economic opportunity in cross-national connections despite a lack of physical presence. This concept is a focus of their research which was recently published in the book Global Talent: Skilled Labor and Mobility in Korea.

“What we’re trying to do is to extend the thinking – to not just look at potential losses of having your people go abroad but also the potential gains,” Choi said. “Previous studies have found that if you have more of these relationships or ‘brain linkages,’ you have more trade and more flow of innovations between countries.”

People who stay in a host country become participants in the local economy and often conduct influential activities such as starting companies, providing advice and sitting on boards of directors, Choi said, and these transactions enact flows of resources from home country to host country and vice versa.

Choi, who outside of his fellowship is an assistant professor at Hong Kong University of Science and Technology, said that this way of thinking pulls away from a zero-sum view of the world and instead sees it as “more globalized, cosmopolitan and diffuse.”

He leads a research project with Shin focused on global talent and cultural movement in East Asia, and over the past quarter, taught a graduate seminar on the Korean development model.

“Cross-national ties are harder to establish than those that are geographically close, but they provide invaluable means of sharing information and brokering cooperation that may otherwise be impossible on other levels,” said Shin, who is also the director of Shorenstein APARC. “In many ways, social ties can be a good strategy to gain a competitive edge. This is an area we endeavor to better understand through our research efforts on Korea.”

Shin has described his own identity of being a part of the very system they are studying. He grew up in Korea, arrived in the United States as a graduate student and has since stayed for three decades and frequently engages the academic and policy communities in Korea.

One cross-national initiative that he recently started is a collaborative study between scholars at Shorenstein APARC and Kyung Hee University in Seoul. The two-year study evaluates the social capital impact of a master’s degree program at the Korean university that trains select government officials from developing countries.

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An international cohort including many researchers from Stanford’s Shorenstein Asia-Pacific Research Center have been conducting group interviews with international students at Korean and Japanese universities to better understand their motivations to stay or go following their completion of a degree or non-degree program at Korean universities. Their initial results reveal that gaps in cross-cultural understanding and opportunities cause feelings of disassociation, but recent internationalization efforts are helping to address those gaps and support innovation, knowledge sharing and local economic growth. An op-ed on the topic authored by Stanford professor Gi-Wook Shin and Yonsei University associate professor Rennie Moon can be viewed here. Credit: Flickr/SUNY – Korea/crop and brightness applied

Harnessing foreign skilled labor

Globalization has also led to migration of people to regions that lack an adequate supply of skilled workers in their labor force. This new infusion of people is an opportunity to bridge the gap, according to the researchers.

“In order to be successful, countries need a large talented labor pool to invest in,” said Yong Suk Lee, the SK Center Fellow in the Freeman Spogli Institute for International Studies and affiliate of the Korea Program. “Innovation is not something like a technology ladder which has a more obvious and strategic trajectory, it’s more about investing in people and taking risks on their ideas.”

Korea currently has a shortage of ‘global talent’ – individuals who hold skills valuable in the international marketplace. Yet, Korea is well positioned to reduce the shortage.

The country produces a vast amount of skilled college graduates. Nearly 70 percent of Koreans between the age of 25 and 34 have the equivalent of a bachelor’s degree. Korea has the highest percentage of young adults with a tertiary education among Organisation for Economic Co-operation and Development (OECD) countries. Another study found that the foreign student population in Korea has risen by 13 percent in the past five years.

Universities are moving to “internationalize” in seeking to both recruit faculty and students from abroad and to retain them as skilled workers in the domestic labor force. A new book published by Shorenstein APARC Internationalizing Higher Education in Korea: Challenges and Opportunities in Comparative Perspective assesses efforts by institutions in Korea, China, Japan, Singapore and the United States through nine separately authored chapters.


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Shin and Yonsei University associate professor Rennie Moon, who served as book editors and chapter authors, found that Korea has on average more outbound students (students who leave Korea to study elsewhere) than inbound students (international students who come to Korea to study). The figure above compares five countries and finds that Korea and China are more outbound-driven while Singapore, Japan and the United States are more inbound-driven.

“For most national and private universities in Korea, internationalization is more inbound-oriented—attracting foreign students, especially from China and Southeast Asia,” said Yeon-Cheon Oh, president of Ulsan University and former Koret Fellow at Shorenstein APARC who co-edited Internationalizing Higher Education in Korea. “In many ways, it’s about filling up students numbers. There needs to be a balance in inbound and outbound student numbers in order for internationalization to have an optimal effect.”

International students that do come to Korea are on average not staying long after graduation, though. The researchers identify reasons being difficulty in adapting to the local culture, inability to attain dual citizenship, language barriers, and low wages in comparison to that of native Koreans; in short – it is not easy to assimilate fully.

These and other barriers facing foreigners in Korea are a focus of a broader research project led by Shin and Moon that aims to propose functional steps for policymakers striving to internationalize their countries and to shift the discourse on diversity.

Developing a narrative

The Korean government has expanded efforts to recruit foreign students to study at Korean universities – many of which now rank in the top 200 worldwide – but addressing education promotion is only one area.

“The challenge is to propose a pathway that rallies around a general narrative,” Lee said, citing a need for internationalization to be coordinated across immigration policy, labor standards, and social safety nets.

An international group of experts in Korean affairs gathered at Stanford earlier this year at the Koret Workshop to address the challenge of creating a cohesive narrative, focused on Korea as the case study. The Koret Foundation of San Francisco funds the workshop and fellowship in its mission to support scholarly solutions to community problems and to create societal and policy change in the Bay Area and beyond.

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The Koret Workshop brings together an international panel of experts on Korean affairs at Stanford. From 2015-2016, the workshops focused on higher education, globalization and innovation in Korea. Above, Michelle Hsieh (far right) speaks during a question and answer session following her presentation on Korean and Taiwanese small and medium enterprises, next to her is former U.S. Ambassador to the Republic of Korea Kathleen Stephens, Stanford consulting professor Richard Dasher, former U.S. foreign affairs official David Straub, and Korea University professor Myeong Hyeon Cho.

The interdisciplinary nature of the workshop was an important aspect, according to Lee, and Michelle Hsieh, one of 27 participants of the conference that covered a range of areas from entrepreneurship to export promotion policies in Korea.

“The workshop demonstrated how internationalization of higher education – and academic research in general – can be achieved by constructing cross-cutting ties,” said Hsieh, who was a postdoctoral fellow at Shorenstein APARC from 2006-07 and is now an associate research fellow at Academia Sinica in Taiwan.

“Participating in the workshop made me realize I really miss the lively and rigorous discussions at Shorenstein APARC, where researchers are interdisciplinary with diverse backgrounds yet focused on a common research interest,” Hsieh said. “I think debate and discussion in that kind of setting can illuminate a completely different take.”

The workshop will result in a book that features multiple areas and policy directions for Korea’s development. The lessons included are also envisioned to apply to other emerging countries facing similar trends of demographic change and economic slowdown. Shorenstein APARC expects to publish the book next year.