GRM 2010 GRM 2011

Abstract Details

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A Preliminary Cost Benefit Analysis of Divergent Strategies of Overcoming Management and Business Skills in Saudi Arabia
Paper Proposal Text :
I. CONTEXT AND STATEMENT OF THE PROBLEM: Like other oil-rich GCC countries, Saudi Arabia has pursued a number of strategies to overcome indigenous skills deficit and to develop human capital geared towards a diversified knowledge-based economy. Three main strategies have been pursued by Gulf states to address the indigenous deficit in management and business skills and the perceived risks associated with overdependence on foreign labor: (1) sponsoring national students to seek higher education abroad in areas of national priorities, (2) building high quality national institutions, and (3) establishing branch campuses of universities. Saudi Arabia has pursued the first two strategies simultaneously, as exemplified by King Abdullah Scholarship Program (KASP) (2005) and the top research universities par excellence. While government sponsorship of foreign students is common to all GCC countries and most of them have had some form of scholarships for advanced studies abroad, Saudi Arabia stands out in terms of the magnitude of resources committed in pursuit of this strategy as manifested in King Abdullah Scholarship Program (KASP). The scale of the initiative can be gauged from the fact that in 2014/15, 59,945 students from Saudi Arabia (60% of all outbound students) were studying in the United States alone (up over 1700% from 2005 when the scholarship scheme was introduced). Saudi Arabia is now the fourth leading place of origin for international students for the 5th year in a row, and ranks first in the Middle East in terms of outbound student mobility.
KASP is a high cost strategy to overcome the skills deficit in the country. According to the US Department of Commerce, Saudi students contributed $3.2bn to the US economy in the 2013/14 academic year alone. In our conversation with the officials of Ministry of Education, it became clear that KASP has never been evaluated in terms of its intended labor market objectives, as scholarship recipients are not tracked upon returning. There is some evidence that the labor market has been unable to absorb all of the returning graduates, and this has posed a serious challenge for the Saudi regime. A related issue is one of the disconnect between female enrolment at tertiary level (including participation in KASP) and their labor force participation. The government has recognized these problems and has undertaken some reforms in the scope of the scholarship program and tightening of the selection criteria.
II. OVERALL OBJECTIVES / SIGNIFICANCE : There have been some descriptive studies of KASP. Most of these studies rely upon sampling (usually small and purposive) of current recipients studying abroad. There has been no rigorous study to assess the impact of KASP in terms of its intended labor market objectives. To date, there has been no study to assess the real and potential contribution of these two strategies to the Saudi labor market. Thus, the overall purpose of the proposed pilot study is to assess the intended and unintended labor market consequences of KASP relative to the contribution of national institutions. The pilot study is expected to lead to a full-fledged project, much larger in scope and scale.
Policy Relevance: The importance of highly skilled and educated labor force able to perform complex tasks and adapt rapidly to the needs of a globalized knowledge-based economy cannot be exaggerated. The twin goals of nationalization of labor force (Nitaqat) and providing suitable jobs for citizens Provide citizens with knowledge and skills to meet the future needs of the labor market are enshrined in National Transformation Program (NTP) and are adopted by the Ministry of Labor and Social Development (MLSD) Strategic objective # 10 & 8). It is expected that the findings of the pilot study will lead to policy recommendations for the improvement ‎of the design of the scholarship program in view of the strategic objectives of MLSD.
Academic Research Contribution: International ‎student mobility is a relatively neglected field in labor market research. We believe that the proposed research will go some way towards correcting the simplistic and reductionist images of the international student in terms of brain drain or brain gain. International student mobility has important implications for the strategic goal of nationalization of - Saudization or Nitaqat of the skilled labor force. However, the nexus between inbound and outbound student mobility and the intended indigenous skills accumulation in the Arab Gulf states has remained a relatively unexplored area. With few exceptions, the studies conducted so far rely upon a very small non-representative samples ‎from a single institution in one of the destination countries, or involve only current recipients or a specific demographic segment thereof. The most significant omission has been the absence of data on the alumni of KASP. To our knowledge, there has been no scholarly attempt at a cost benefit analysis of the two divergent strategies to address the indigenous deficit in business and management skills.
Analysis Plan: The proposed research is designed as a rigorous non-experimental case study of KASP to assess its intended and unintended labor market consequences. The pilot study adopts a mixed methods approach involving both qualitative and quantitative methods to enhance the credibility of findings.