jonas husum johannesen head of section danish agency for universities and internationalisation

Ministry of Science, Innovationand Higher Education

24 september 2013Helsinki

Jonas Husum Johannesen

Jonas Husum JohannesenHead of Section

Danish Agency for Universities and InternationalisationMinistry of Science, Innovation and Higher Education

[email protected]

Macroeconomic benefits of attracting international students

Helsinki, September 24, 2013




The Reason




Increasing number of international students in Denmark




The yearly intake of international students

2005 2006 2007 2008 2009 2010 2011

Nordic 1.298 1.435 1.561 1.616 2.030 2.141 2.024

Other EU/EEA 1.478 1.655 2.121 2.971 4.071 5.147 5.854

Non-EU/EEA 1.595 1.053 1.211 1.663 1.674 1.399 1.443

Total 4.371 4.143 4.893 6.250 7.775 8.687 9.321




Retention and employment

Year of Graduation

2004 2005 2006 2007 2008 2009

After 1 year 47 51 52 54 56 55

After 2 years 42 45 46 49 50 -

After 3 years 38 39 41 44 - -

Year of Graduation

2004 2005 2006 2007 2008 2009

After 1 year 82 73 74 72 75 74

After 2 years 83 74 73 73 74 -

After 3 years 83 72 73 73 - -

Retention

Employment




A need for more knowledge

Existing knowledge:•Attracting international students and recruiting from the Study in Denmark initiative (input)•Student satisfaction and perception of studying in Denmark (process)•Retention and employment (output)

No knowledge:•Long term effects of international students (outcome)




The Model




The DREAM model - I

• Danish Rational Economic Agents Model• Based on registry data from Statistics Denmark• The DREAM system is used to evaluate the long-term development of public finances in Denmark• The central question is whether the fiscal policy is sustainable based on two variables: the future revenues and

future expenditures of the public




The total DREAM system consists of three pre-models:

· The population projection model,

· The education projection model,

· The socioeconomic projection model,

They feed into:

· The DREAM economic model.

The DREAM model - II




Example of calculation

• 5000 immigrants are introduced into the population model• In the education model they are assigned a level of education• In the socioeconomic model they are assigned a labor market category• In the DREAM economic model, public finances are calculated for the alternative population development with

5000 additional immigrants.




The Analysis




Three experiments

A. An annual increased influx of 1,000 immigrants from Western countries with Bachelor’s degrees; all of whom are accepted for Master’s programmes and where the Danish state finances the educational costs.

B. An annual increased influx of 1,000 immigrants from non-Western countries with Bachelor’s degrees; all of whom are accepted for Master’s programmes and where the educational costs are borne by the student based on tuition fees.

C. An annual increased influx of 1,000 immigrants from Western countries with Bachelor’s degrees; all of whom are accepted for Master’s programmes and where the educational costs are borne by the student based on tuition fees.




The results

• Overall, the analysis shows that there is a socioeconomic benefit in attracting international students to study a full Master’s programme, even if the programme is financed by the Danish state

• Experiment A (No tuition – western) lead to a lasting annual increase of the primary public budget of DKK 0.75 billion • Experiment B (Tuition – non-western) lead to an annual increase of DKK 0.36 billion• Experiment C (Tuition – western) lead to an annual increase of DKK 0.79 billion




Variation relative to the baseline in the primary public balance, 2011 level




Labour Force and GDP effets

Change in population and labour force

Change in GDP




Validity

Analysis can be seen as slightly conservative

• Models the whole group of western and non-western immigrants in the relevant age and education bracket• Does not take productivity effects into account• Level of education and demographics not directly linked• The main conclusion of the analysis, that attracting international students is socioeconomically beneficial, is however viewed to be fully valid.




The Usage




Usage

• Often cited in media when international students are discussed• Have been confirmed by different economic experts• Used politically in support of international students coming to Denmark to study• Has been an important input in the discussion concerning the ECJ-ruling on

access to SU

jonas husum johannesen head of section danish agency for universities and internationalisation

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