© COPYRIGHT by Lucas Olson 2016 ALL RIGHTS RESERVED ii! US-SINO JOINT EDUCATION VENTURES IN CHINA: A STAKEHOLDER ANALYSIS OF HOPKINS-NANJING CENTER, DUKE KUNSHAN UNIVERSITY, AND SCHWARZMAN SCHOLARS By Lucas Olson ABSTRACT Elite US-Sino joint education ventures in the People’s Republic of China (PRC) have brought together diverse stakeholders to create a learning environment that supports innovation in the context of China’s transformation to a service-based economy. These diverse stakeholders include: university administration, faculty, and students; government agencies; and industry. Theories of strategical alliances are useful in understanding how these stakeholders interact and influence these institutions during their establishment. Important insights can be learned about how to build successful cross-border education partnerships in a complex social environment. Three descriptive case studies were conducted through in-depth interviews, site visits, and official documentation. The first case is the Hopkins-Nanjing Center at Nanjing Universi- ty—the first US-Sino venture established in 1986. The second case is Duke Kunshan University, and the third case is the Schwarzman Scholars Program at Tsinghua University, heralded as the Rhodes Scholarship of China. !iii Acknowledgements I would like to thank first and foremost my committee members who accompanied me through the painstaking process of seeing this project to completion. A deep level of thanks is due to Dr. Louis Goodman of the School of International Service at American University for his constant encouragement and push to see me succeed. His focus on inductive research and always pushing me to get into the field has been a source of great learning and balance for my deductive tendencies. Thank you also to Dr. Amanda Taylor of the School of International Service at Amer- ican University for encouraging me to be rigorous in my methodology, critical in my thinking, and for always helping to keep me grounded. Thank you to the School of International Service for the grant that allowed for the field research in China. Also, a sincere thank you to all who allowed me to interview them and gain a window into the incredibly fascinating and important work that they do. I would also like to thank Karen Ives for editing my early drafts and for her support throughout the research and writing process. Finally, thank you to the Carter Center and Global Times for the opportunity to present the results. The writing of this thesis has been an amazing learning process about the in- tricacies of international and transnational higher education, and I am profoundly grateful for the experience. !iv Table of Contents Abstract…………………………………………………………………………………………..ii Acknowledgements………………………………..…………………………………………….iii List of Tables……………..……………………………………………………………………..vi List of Illustrations……………………………………………………………………………..vii Introduction………………………………………………………………………………………1 Outline……………………………………………………………………………….…….………4 Research Significance……………………………………………………………..…………..…6 Background……………………………………………………………………………..………..8 Research Problem……………………………………………………………….….…………..15 Research Question……………………………………………………………….….………….18 Theoretical Framework…………………………………………………….…………………..19 Literature Review……………………………………………………….……………..……….23 Methodology…………………………………………………….………..……………………..29 Case (Site) Selection………………………………………………….………..….……………..30 Hopkins Nanjing Center………………………………………………….……………………32 Stage 1: Envisioning HNC………………………………………………….……..…..…………32 Stage 2: Negotiations………………………………………………….………..…..……………34 Stage 3: Implementation………………………………………………….………..…….………37 Stage 4: Evaluation and Evolution………………………………………………..…………..…40 30th Anniversary Celebration: Reflecting Back…………………………………………………49 !v Duke Kunshan University………………………………………..…….………………………55 Stage 1: Envisioning Duke Kunshan University…………………………..…….………………55 Stage 2: Negotiations………………………………………………….……..…..………………56 Stage 3: Implementation………………………………………………….….……..……………63 Schwarzman Scholars………………………..…………………………………………………73 Stage 1: Envisioning Schwarzman Scholars…………………………………….…………….…73 Stage 2: Negotiations………………………………………………….…………………………74 Stage 3: Implementation………………………………………………….…..…………………78 Discussion……………………………………………….………………………………………89 Strategic Alliances………………………………………………….………..……..……………91 Stakeholder Analysis………………………………………………….……….…………………95 Hybrid Model of World-Class Chinese University………………………………..……………100 Rival Theories………………………………………………….………..………..……………105 Recommendations for Practice……………………………………………….………………110 Conclusion……………………………………………………………………..………………113 List of Interviews.…………………………………..…………………………………………115 References…………………………………………..…………………………………………116 !vi List of Tables Table 1: Program Details………………………………………………………………………90 Table 2: Outcomes…………………………………………………………………………….102 vii! List of Illustrations Diagram 1: Stakeholders in Higher Education……………………………………………….22 !1 Introduction US-China relations have repeatedly been described as the most important bilateral rela- tionship in the world for the 21st century (e.g. Kissinger 2014; Christensen 2015), and, in the sto- ry of this relationship, international higher education has played a key role. According to the In- stitute for International Education (2014), China is the origin of nearly one-third of all in- ternational students who study in the US higher education system, which in 2013-14 hosted near- ly twice as many international students as any other country (Altbach and Knight 2007). This trend is not a recent development, as the history of education exchange between the US and Chi- na extends back over a century (Li 2007). Yet throughout this history, collaboration in this area has been subject to the vagaries in US-Sino government relations. During the period 1949-79, educational exchanges ceased to exist as the People’s Republic of China (PRC) and the US did not have formal diplomatic relations. Following the establishment of formal relations in 1979, international education grew rapidly to their currently levels. This thesis explores some of the most high-profile education institutions established in this period that are helping to further de- fine the relationship between the United States and China. International education between the US and China has taken on new dimensions since China joined to the World Trade Organization (WTO) in 2001. WTO membership required China to open its education market to foreign providers, and in 2003 China’s Ministry of Education re- leased regulations to manage foreign providers that required all foreign universities to have a Chinese partner. This opening of China’s education market has since created a large growth of joint-venture partnerships, and, by 2013 there were 1,780 such jointly-run institutions and pro- !2 grams with overseas partners (Jingjing 2013). Branch campuses, the most ambitious ventures that foreign universities can undertake, have also grown, and currently 27 branch campuses have been set up in China, according to Cross-Border Education Research Team (C-BERT) at the State University of New York at Albany. Eleven branch campuses have been set up in China by US institutions, more than any other country (C-BERT 2016). The presence of this large number of US education providers in China has had important implication for US-China relations, and this thesis presents, in the form of three separate case studies, an analysis of the stakeholders in- volved in the establishment of three key US-Sino joint-venture educational institutions in China. China’s two most recent national Five-Year Plans (FYPs) (2011-15 and 2016-20) have established an economic transition from manufacturing to services at the forefront of the national agenda, and this transition has created important context for US higher education providers that are currently operating in China or are seeking to do so. The role of higher education has been highlighted as necessary to create the human capital and innovation required for this economic transition. However, there is a wide perception that quality in China’s higher education is falling short of employer expectations. In the late 1990s and 2000s, major government initiatives, such as the 98/5 initiate and 2/11 initiative, pumped billions of Yuan into leading Chinese universities. However, in 2014, the unemployment rate of college graduates six months after leaving universi- ty was still between 15-30% (Sharma 2014). Multinational corporations, a key employer of high- skilled human capital and provider of services in China, have been warning for nearly a decade about the problem of Chinese graduates being unfit for the service export sector. In 2005, a re- port by McKinsey titled China’s Looming Talent Shortage predicted a shortage in the labor mar- ket based on the inability of higher education institutions to effectively train students for the job !3 market and suggested that multinational corporations (MNCs) in China would need to internally train employees for the foreseeable future (Farrell and Grant 2005). It is within this context of China’s increasing demand for high-quality higher education programs to aid in the economic transition that joint-venture institutions find themselves. However, the context in the US also plays an important role for US universities that are partners in a Chinese joint-venture. The necessity of supporting the Chinese government’s agenda has challenged US univer- sities to reflect on their core mission as educational institutions as well as their responsibilities as institutions