Brain Drain and Economic Developmentin the Context of U.S.-Korea Alliance
Sunwoong Kim
University of Wisconsin
Ju-Ho Lee
Korea Development Institute, Korea

I. Introduction
Most people would acknowledge that the military andeconomic alliance between the U.S. and South Korea (Korea
hereafter) has played a very important role in shaping the modern
history in Korea. Among other things, many have pointed out that
Korea's savings in military spending in order to deal with the North
Korean threat since the Korean War is one of the major benefits ofthe strong alliance, because the savings that should have been
diverted to military expense could be invested for improved
economic development. Also, under this security arrangement,
Korea has successfully implemented the strategy of export-as-anengine-for-economic-growth by borrowing heavily from theinternational financial market.
Without the U.S.'s security
guarantee, international borrowing would have been much morecostly. Another important aspect of the strong alliance is that the
U.S. has been the major market for Korean exports for several
decades.
In explaining Korea's successful economic development
experience since 1960, economists usually point to several reasons.
The rapid expansion of production capacity through heavy
investment in capital goods and social infrastructure, stable
governments, high domestic savings rates, a disciplined Confucian
work ethic, and well-timed government-led economic policies havebeen often cited as the major determinants of Korea's high growth
rates. However, the accumulation of Korea's human capital has
been mostly ignored in discussions of Korea's successful economic
development process. This article, focuses on the role of humanresources, particularly highly trained professionals, which will bereferred to as "brains" hereafter, in the economic development
process from the perspective of the U.S.-Korea alliance.
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3International Journal of Korean Studies • Vol. VII, No. 1

99

II. Role of Human Resourcesin the Rapid Economic Development of Korea
Many scholars date Chung-Hee Park's industrial policy ofexport promotion as the beginning of Korea's success story.
However, one often overlooked fact is that when Park started to
implement this policy, Korea was already prepared with quite
substantial human resources as a result of more than a decade ofintensive human capital investment by the previous administration.
Immediately after independence, the Rhee administration pushed
for universal primary school education under the guidance ofAmerican education planners. Although seriously jeopardized by
the outbreak of the Korean War, the successful post-war
implementation of universal primary schooling increased theprimary school enrollment from 1.37 million students in 1945 to
2.27 million in 1947 to 4.94 million in 1965. Despite substantial
foreign aid provided by the U.S., Rhee's government failed toestablish a peaceful and prosperous economy, mainly due towidespread corruption among its political elite. But, its legacy of
expanding universal education paid off handsomely several years
later. The number of teachers increased from 20,000 in 1945 to
79,000 in 1965. By 1965, the goal of universal primary school
education had been more or less achieved, and the human resources
for Park's export promotion policies were already in place.
4

5

The second important aspect of human capital resources inthat era was the availability of brains that assumed leadership roles
in Korean economy. Most of these people received advanced
degrees in the U.S. As the U.S. was heavily in the Korean War andthe reconstruction efforts afterwards, many Korean brains went to
the U.S. for advanced study. Although the Korean government did
not pursue the systematic policy of "learning from the West" that
the Meiji government of Japan adopted in the middle of thenineteenth century, substantial numbers of brains came to the U.S.
to pursue further education and training by taking advantage of thepatron-client relationship between the U.S. and Korea. Also, astrong alliance between the two countries enabled many others tocome to the U.S. with private funding after the war. In any case, by
the early 1960s, there was a substantial number of U.S.-educatedand trained brains that could be tapped by the government,
universities and the private sector.
It has been widely recognized that the cooperation between
6100Intl. Journal of Korean Studies • Spring/Summer 2003

the government technocrats in the Korea Economic Planning Board,and the government-sponsored think tank, Korea Development
Institute, successfully charted a roadmap of economictransformation to transform Korea from a poor, backward, agrarian
economy to a productive industrial one. Most of the intellectualgroup that led this initiative had been trained in the U.S., and had
extensive contacts in the U.S. These American contacts also
contributed to successful economic development planning. And
this successful cooperation by Korean technocrats and American
experts has been a direct result of the strong U.S.-Korea allianceunder the Park administration.
7

8

III. Influx of Korean Students to the U.S.:
Brain Drain or Import of Graduate Education?
Throughout the history of the Republic of Korea, domestic
education opportunities have expanded. Compared to the direcondition immediately after independence, the current educationalsituation is nothing short of a miracle. In 1945, the enrollment rate
for primary school was less than 60%, and less than 3% of collegeaged children attended higher education establishments. As of 2003,
schooling through grade 9 has become free and mandatory, highschool (grades 10-12) is more-or-less universally attended withmodest fees, and about 70% of high school graduates advance tohigher education institutions. In terms of the number of college
students to their age cohort, Korea ranked the first in the world in2003.
Unfortunately, the rapid expansion of educational
opportunities in Korea has not been accompanied by quality
improvements. Even though government's expenditure on primaryand secondary schools has increased tremendously over the years,
dissatisfaction over the high cost of private tutoring and fierce
competition to enter universities have been a perennial social
problems.
The lack of improvement in quality has been
particularly evident in higher education which relies least on
government funds. When the Park administration implemented theequalization policies that eliminated competitive student selection
by primary and secondary schools in exchange for government
subsidies, the Korean government had to increase its support for
public funding for primary and secondary education substantially.
As the government put more resources into primary and secondary
910International Journal of Korean Studies • Vol. VII, No. 1 101

education, the higher education sector had to rely heavily on private
finances.
While competitive student selection procedures toprimary and secondary schools have been eliminated, universities
have maintained competitive entrance examinations. Because of thestrong demand for higher education, Korean universities have nostrong incentives to improve the quality of instruction in order toattract more students. Also, as its revenue relies heavily on
students' tuition payments, the universities have been moreinterested in increasing the number of students. There is no strong
incentive to invest in research activities that are costly and do notyield immediate return to the university. In short, the Korean
higher education system is characterized by high levels of college
attendance, private funding, low quality instruction, and fierce
entrance examinations.
At the same time, the primary andsecondary schooling system can be characterized as mediocre,
supplemented with costly but effective for-the-exam, private
tutoring activities.
11

In particular, the quality of graduate education in Korea has
not improved very much over the last several decades. Since the1960s, more and more faculty positions, particularly in science,engineering, and business disciplines are filled by returning students
with foreign Ph.D.s, a majority of whom are from the U.S.
Following their favorite professors' advice, the brightest students
who aspire to obtain advanced degrees go abroad, and the U.S. has
been the most popular destination.
The strong U.S.-Korea
economic and intellectual alliance helps to sustain this cycle.
Table 1 shows the dramatic increase in the number of
Ph.D.s received by Korean students since 1975. Notice that most of
this increase is due to the increase of students with temporary visas(student or exchange scholar visas). The bonanza of obtaining U.S.
Ph.D.s culminated in 1993-94. In those years, more than 6% of thetotal Ph.D.s granted in U.S. institutions were awarded to Koreans.
Since then, it has started to decline quite rapidly. In the year 2000,
the number of science and engineering Ph.D.s received by Koreanshas decreased by a third compared to the peak years.
Naturalscience and engineering disciplines traditionally had the largest
share, and the share of social sciences has decreased substantiallysince 1985, while that of the humanities and professional studies has
increased. It is quite clear that more and more students have been
supported by personal means since 1985.
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102 Intl. Journal of Korean Studies • Spring/Summer 2003

Table 1. Statistical Profiles of Korean Doctorates Received in the US.

Classification

1975

1980

1985

1990

1995

2000

Total number ofPh.Ds earned

190

158

392

1,259

1,306

1,048

Natural Scienceand Engineering(%)
Social Science
including
Psychology (%)

59.5

55.0

64.2

60.9

52.4

53.2

21.6

28.5

18.7

16.9

24.6

18.0

Humanities,
Education, andProfessional (%)

18.9

16.5

17.1

22.2

23.0

28.8

Some personal
financial support
(%)

44.2

53.8

79.7

72.4

74.1

96.5

With permanentvisa (%)

36.3

21.5

12.0

5.6

10.0

9.7

Intend to stay in
the U.S.(%)

46.8

48.5

33.5

31.5

38.7

64.1

Firm Plans to
Stay in the U.S.
25.8
37.7
40.9
23.0
42.9
20.9
(%)
Source: Jean M. Johnson, Statistical Profiles of Foreign Doctoral
Recipients in Science and Engineering: Plans to Stay in the United States,
NSF-99304, Arlington, VA: National Science Foundation, 1998. Year 2000 isfrom unpublished special tabulation. N o t e : Only for science and engineering(including social sciences).
aBecause of substantial living standard differences between
the U.S. and Korea, there was a substantial brain drain during thisperiod. Many bright Korean students who finished their advanced
degree in the U.S. ended up settling down in the U.S. Thisphenomenon was particularly keen in the science and engineering
fields, where scholarships for graduate students and employment
opportunities for graduates were abundant. At the same time, quite
International Journal of Korean Studies • Vol. VII, No. 1 103

a few medical doctors migrated to the U.S. during the 1960s and1970s after the Kennedy administration started to accept theimmigration of foreign doctors. The brain drain of professionals
from low income countries to high income countries has been
widely observed in many countries. According to a U.S. National
Science Foundation report, 63% of foreign-born students whoearned science and engineering doctorates from U.S. institutions
between 1988 and 1996 said they planned to locate in the U.S.
Two-thirds of those who planned to stay had firm plans for further
study or employment.
The number was substantially lower for
Koreans: among the science and engineering doctoral recipientsduring the period of 1988-96, about a third wanted to stay in the
U.S., and about two thirds of them had firm plans to stay (seeFigure 1).
415

Figure 1. Plans of Korean Science and Engineering Doctoral Recipients
at Degree Conferral: 1988-1996
Permanent
visa
8.1%

Non-

Firm plan tostay in the
U.S.
63%

Plans tostay in the
U.S.
36.1%

Seeking tostay in the
U.S.
37%

Total
permanent
number of
No plans to stay in the U.S.
visa
Ph.D.s
63.9%
91.9%
8,851
Source: Jean M. Johnson, op. cit.

Post-doc
47.1%
Employment
15.6%
Post-doc
23.5%
Employment
12.6%

In the case of Korea, the concern over the brain drain
turned out to be brain savings to some extent. As economic
opportunities for Korean talents, particularly in business andengineering, expanded in Korea during the 1980s and 1990s, a
substantial number of those who settled in the U.S. returned to
Korea. Even if they did not return to the U.S. permanently, many
served as resource persons in academia and industry, when such
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Intl. Journal of Korean Studies • Spring/Summer 2003

Korean organizations sought occasional help for technical expertise.
Until the early 1990s, despite a large gap in earningpotential between the U.S. and Korea, many U.S.-educated brains
gladly chose a career in Korea because the jobs there tended to behigher in status with more responsibility. Korean jobs also tended
to be more stressful and with longer hours, but they could be more
fulfilling as they came with more responsibility. Between 1965 and1995, the Korean economy grew rapidly, and there was a strong
demand for such brains in leadership positions. Most of the U.S.
educated brains were able to take up such positions.
Therefore, it is safe to conclude that until the mid-1990s,
Korea did relatively well in minimizing the brain drain. Comparedto other Asian countries such as China and India, the percentage ofbrains who intended to stay in the U.S. was substantially lower. In
this regard, the large influx of Korean students during this period
can be regarded as an effective mechanism for training high level
human resources without much domestic investment, and the strong
alliance between the U.S. and Korea was one of the most important
determinants of this success story.
IV. Role of U.S.-Educated Ph.D.s in Korea
Currently in Korea, the U.S. educated Ph.D.s are the major
component of high level human resources. In 1999, 40.1 percent offull time faculty in Korean universities had earned Ph.D.s fromabroad, with 67.2% of them from the U.S.
This ratio would
undoubtedly be higher among younger faculty members. Amongthe 22,133 foreign doctoral recipients registered in the Korea
Research Foundation in 2001, 12,824 (about 58%) had received
their degrees from the U.S. In the top ranking research universities,
such as Seoul National University, Yonsei University, Korea
University, Korea Advanced Institute of Science and Technology(KAIST), and Pohang University of Science and Technology(POSTECH), most faculty had received their Ph.D.s from major
U.S. universities.
Most university students in the 1970s and 1980s recognized
the high rewards for U.S. Ph.D.s. Consequently, much talent cameto the U.S. for higher degrees, and a majority returned to Korea.
However, the process could not be sustained in the long run. In the
Korean labor market, an advanced degree has been regarded as
more of a credential, and the credential has been more important
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International Journal of Korean Studies • Vol. VII, No. 1 105

than the performance of an individual worker in determining thelabor market outcome. For example, professors are granted de facto
tenure when they are hired, and the determination of salaries andpromotions is hardly affected by individual performances after thehire. Even in private firms, loyalty and the length of the job tenure
are regarded as more important in determining the fate of theworker. However, as enrollment in higher education in Korea
increased dramatically and foreign Ph.D.s grew dramatically, thereturn to college and post-graduate education started to decrease
substantially.
The Korean system, relying that on credentials
rather than competitive pressure for resource allocation, created anincreasing excess supply of talents and wasteful rent-seeking
activities over time.
17

Table 2. Doctoral Degrees awarded in Korea
Year

Number of Ph.D.s

Ratio (%)*

1970

407

n.a.

1975

994

19.1

1980

528

29.9

1985

1,400

28.0

1990

2,747

45.8

1995

4,469

29.5

2000

6,558

13.9

2002

7,623

n.a

Source: Number of Ph.D.s - Korea Ministry of Education and Human
Resources, Education Statistics Yearbook, various years.
Ratio of U.S. Ph.D.s to Korean Ph.D.s in percent is calculated byauthors, n.a.: not available

During the late 1980s and early 1990s, it became evident
that the job prospect for U.S.-educated Ph.D.s had dimmed as thenumber of U.S.-educated Ph.D.s grew rapidly. More graduate
students then wanted to stay in Korea for their Ph.D. in order not to106

Intl. Journal of Korean Studies • Spring/Summer 2003

lose contact with the professors who could be helpful in securing
teaching positions. Also, the quality of faculty and graduate
education in Korea improved substantially, thanks to the quality of
the new faculty and the establishment of graduate and researchoriented universities. Consequently, the relative attractiveness of
pursuing a PhX). in Korea increased substantially over time. At thesame time, the Korean government provided military service
exemptions to those pursuing graduate education in Korea. Becauseof all these factors, the number of graduate students and Ph.D.sawarded in Korea rose rapidly after 1985. As shown in Table 2, thenumber of Ph.D.s awarded in Korea was only about 400 in 1970. In
2002, the number of Ph.D.s awarded in Korea was 7,623, quite highcompared to other nations. The last column in the Table is the ratioof number of Ph.D.s awarded in the U.S. to the number of Ph.D.sawarded in Korea for that year. Between 1975 and 1990, the ratio
has increased rapidly, but decreased suddenly after 1990, reflecting
both the desire of graduate students to pursue Ph.D.s in Korea andthe rise and fall of the popularity of the U.S. Ph.D.s.
The glut of Ph.D.s produced domestically and abroad has
made the job market for Ph.D.s extremely tight. It has beenreported that one third of the Ph.D.s do not have meaningfulemployment, and the situation is likely to become worse. A
peculiar trap for this excess supply Ph.D.s is the under-employed"part-time instructor".
Most Korean universities, particularly
private universities under strong incentives to reduce expenditures
for teaching personnel, have relied heavily on cheap part-time
instructors.
The number of part-time instructors in 2003 is
estimated at more than 50,000, and is more than the number of fulltime instructors. After investing so many years earning their
Ph.D.s, part-time instructors struggle with low earnings for many
years, hoping eventually to secure full time teaching positions.
Because of the slow turnover of the regular professorial positions
and the sluggish expansion of new positions, the wait becomes
longer every year.
Although there have been examples of world class research
universities (e.g., KAIST and POSTECH), most of the Ph.D.
programs in Korean universities remain weak. As Korea enters intoa more knowledge-based economy, the role of research anddevelopment becomes more important. Consequently, there has
been a rising concern related to the quality of university education
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International Journal of Korean Studies • Vol. VII, No. 1 107

in Korea. For example, Korea ranks almost at the bottom of all
major countries ranked by the IMD criteria as to whether theuniversity system meets the needs of a competitive economy.
However, it is fair to say that the effort to upgrade Korea's higher
education system emphasizing the supply side has not been very
successful, while the labor demand for brain in Korean economy
has not grown substantially.
20

V. Increasing Supply and Decreasing Demand of Talents
in Korea: Large Scale Brain Drain?
According to a recent study done by the Korea Trade
Association, the number of Korean students seeking degrees or
language training abroad is about 350,000. The amount they spentin one year has been estimated at about 4.6 billion U.S. dollars,
which is about a quarter of the budget of the Korea Ministry of
Education and Human Resources. There has been a steep increasein these numbers. Currently, there are about 150,000 Korean
students enrolled in higher learning institutions abroad. Out ofthese students, about 60,000 (40%) are in the U.S. Other popular
destinations are other English speaking countries, such as Canada
and Australia, which take an additional 30,000 students.
In 2002, there were about 500,000 foreign students in U.S.
higher education institutions. Korea ranks third in total numbers,
following China and India. Roughly speaking, Korean students
make up about 10% of the total of foreign students in the U.S.
Since India and China have much bigger populations than Korea,
Korea's presence in American universities is quite substantial.
With the educational opportunity in Korea improving substantially,
why are so many Korean students choosing to study in the U.S. andother countries? As this article indicates, the answer is primarily
related to job market conditions in Korea.
Since the late 1980s, the composition of students goingabroad to study has changed substantially. Instead of graduate
students, more and more undergraduate students have gone to the
U.S. The phenomenon has been driven by the following factors.
One is that rising incomes have enabled middle class students
without any outside scholarship to attend foreign universities. The
second factor is that the emerging global economy in Korea hasawarded additional benefits to job applicants with better foreign
language skills (particularly English). Many college students have21

22

108 Intl. Journal of Korean Studies • Spring/Summer 2003

taken a semester or even a year off, and headed for study abroad to
sharpen their language skills. The third reason is that the search forexchange at the secondary school level has been compromised by
the goal of equality in education.
Besides the brain drain that started in the 1970s, (i.e.,
Korean nationals who receive advanced degrees in the U.S. staying
in the States), there are new trends of even more extensive brain
drains out of Korea. Many professionals who returned to Korea inearlier years, have migrated back (return-return-migration) to the
U.S. for various reasons (unsuccessful career development in Korea,
family problems such as difficulties in raising children, and so on).
However, the current economic difficulty in Korea, risingnationalism (and anti-Americanism), and security uncertainty
created by the North Korean nuclear weapons program are also
major contributing factors to this return. Moreover, more and moretalented Koreans who are already out of Korea wish to stay out of
Korea.
The earlier wisdom that they can lead more fulfilling
professional careers in Korea is no longer accepted. As the senior
positions in Korean government, university teaching positions, andprivate sectors for expatriates has shrunk, the prospects for suchjobs in Korea has also.
The shifting paradigm of personnel policies since thefinancial crisis of 1997-98 has contributed to a new brain drain.
Many Korean professionals have started to view jobs in Korea as nolonger life-time employment. Most mid-career workers have begun
to think that, unless they upgrade themselves continuously, they
face the danger of losing their jobs. For career development
purposes, therefore, many young professionals have viewed
American and other foreign jobs that have emphasized individual
performance and improvement as more suitable than Korean jobs
that have emphasized organizational harmony and loyalty. There
has been an additional social consideration for younger workers.
Unlike their older colleagues who grew up in tougher economic
situations, the new generation has enjoyed more comfortablematerial lives, and has tended to be more individualistic and value
quality of family life over a more fulfilling career. Many of thesepeople have viewed the high pressure of working conditions in
Korea less favorably than the American situations.
At the same time, the number of primary and secondary
school students who have gone abroad to study has grown rapidly.
23

24International Journal of Korean Studies • V o l . VII, N o . 1

109The number in 2001 was estimated at about 16,000. Most of thesestudents have been children of upper-middle- and upper- income
households with strong ties to foreign countries, such asprofessionals who had studied in the U.S. earlier, or cultivatedbusiness affiliations abroad. Quite often, the burden of private
tutoring, the pressure of college entrance examinations, and the poor
quality of schools in Korea have been cited as the major reasons forstudy abroad. It is likely that the students who have left Korea at a
young age will be more likely to work and stay abroad in the future.
VI. Exit or Voice? The Choice of the Korean Brains
One may wonder why the anti-U.S. sentiment, particularly
among young people, is growing in Korea while the number of
Koreans who come to the U.S. to study is also growing more
rapidly than ever.
Common expectations, as expressed by U.S.
State Department officials are that the more foreign students
experience American culture, the more favorable their impressions
will be towards the U.S. Several factors would seem to contributeto this phenomenon. Some are directly related to American foreign
policy toward the two Koreas, while others are purely domestic innature.
First, the young generation has not experienced theuncertainties of the Korean War. Consequently, their security
concerns about North Korea are much weaker than that of older
generation. Also, the young people have grown up in a more
affluent environment in which Korea is portrayed as a sizable factor
in the international arena (member of OECD, successful sponsor forinternational events such as Olympic Games and World Cup, and soon). In this regard, young people would like to assert their national
pride, and the assertion is sometimes expressed as more
independence from the U.S. in various areas, including military,political, diplomatic, economic, and social spheres.
Second, the political coalition that successfully elected
President Rho was based on resistance to people in power including
big corporations, conservative opinion leaders in the mass media,
universities, and government bureaucracies.
Because thedemocratization of Korean politics put these forces into the mainstream, the movements are beginning to be considered as a force forpolitical freedom for oppressed minorities. As the Rho governmentis reluctant to discourage its political supporters, these opinions(e.g., anti-U.S. slogans) expressed in mass rallies have been
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Intl. Journal of Korean Studies • Spring/Summer 2003

accepted as the major opinion.
Third, the North Korean government has successfully
played an important role in driving a wedge between thenationalistic movement sponsored by Rho government and antiNorth Korean political forces. For years, North Korean openly
criticized the Grand National Party and the conservative media(Chosun Daily Newspaper in particular) as U.S. puppets and abetrayer of the Korean people against unification. A recent example
is that the anti-North Korea rally by conservative civicorganizations that included the burning of the North Korean flag
and Kim Jong H's portrait caused the North Korean team not toattend the 2 2 Universiade Games in Daegu. However, North
Korea reversed its decision after President Rho expressed regret
about the incident. Though it is not clear how divided younger
generations are dealing with North Korea, people with strong
nationalist sentiments are clearly more vocal under the current
administration.
Fourth, the wave of strong labor activities and North
Korea's nuclear threat have been major stumbling blocks to foreign
investment in Korea. Despite strong efforts to promote foreign
investments by the Kim Dae Jung and Rho Moo Hyun governments,
the current political and economic environment is regarded as not
hospitable to active direct foreign investment. The lack of growthin employment in the midst of the continuing supply of college
graduates in Korea has created a tight job market for college
graduates and young professionals. Recent college graduates havebeen frustrated by this tight job market, as the dream of social
mobility and secure jobs through more education have not beenrealized. With newly found national pride in the young generation,
this frustration is often directed at the U.S.
The inability to create jobs, particularly high paying
professional jobs, is the major weakness of the current Korean
economy. For the last three decades of economic growth, theKorean economy has relied on the manufacturing sector. Althoughseveral manufacturing industries, including ship building,automobile, and electronics, are strong in Korea, the manufacturingsector in general is not likely to create a great number of jobs.
Moreover, there is a serious mismatch between current job openings
and the emerging labor force. Although labor shortages and highwages are reported in manufacturing and blue collar jobs, collegeInternational Journal of Korean Studies • Vol. VII, No. 1 111
ndeducated workers are not willing to take such jobs. This tendency islikely to continue in the future.
Given this serious mismatch between the demand andsupply of labor, it seems that a stronger U.S.-Korea alliance could
create more professional jobs in Korea. Currently, almost one-halfof employment opportunities in Korea are in the informal sector.
Although most of these informal sector jobs are in services, theytend to be low-paying-low-productivity-dead-end jobs. As the
Korean economy matures, it is quite likely that professional service
sector jobs could be the engine of economic growth of Korea in the
coming decades.
A common response to the ineffective education systemand tight professional job market is that talented younger brains areleaving Korea. They are typically children of upper class andmiddle class parents with professional jobs. Many of them are
educated in the U.S., and some were born as American citizens. In
the case of males, most took advantage of the exemption of
mandatory Korean military service. More and more resources arebeing devoted to educating these children, and unless the U.S.Korea alliance becomes stronger, they are unlikely to return toKorea for meaningful careers. In this regard, this brain drain will
likely be permanent.
In our view, the effect of the eroding U.S.-Korea allianceon bi-lateral trade will not be very significant as long as both parties
have something to gain by the trade. Even if trade sanctions are
imposed for political reasons, they will likely be removed quickly,
as the competing political party or the interest groups losing
because of the sanctions will vigorously oppose them. Even withthe ardent anti-U.S. sentiment, Korea will continue to import
American aircraft and food, while the U.S. will import cell phones
and semi-conductors from Korea. However, an eroding alliancewill deter direct U.S. investment in Korea, which is vital to job
creation in the professional service sector and to the transfer ofcompetitive management skills and technologies. Moreover, it will
increase the brain drain from Korea to the U.S., resulting in the
reduction of the growth potential in the future Korean economy. It
is ironic that the younger generation which has been most vocal
against the U.S. in recent years will be the biggest victim of theeroding U.S.-Korea alliance.

112 Intl. Journal of Korean Studies • Spring/Summer 2003

Notes

1. In 2003, Korea spends less than 3% of GDP for military purposes, whereas
North Korea is estimated to spend about 25% of its GDP in the same category.
Although the short run economic impact of defense spending is controversial,
the heavy burden on military spending surely has a negative effect on long term
economic growth. See Addur Chowdhury, "A Causal Analysis of Defense
Spending and Economic Growth," Journal of Conflict Resolution 35, 80-97;
Saadet Deger, "Human Resources, Government Education Expenditure, and theMilitary Burden in Less Developed Countires," Journal of Developing Areas20, 37-48; Emil Benoit, Defense and Economic Growth in Developing
Countries, Lexington, MA: Lexington Books, 1973; and James E. Payne andSahu P. Anandi, Defense Spending and Economic Growth, Boulder, CO:
Westview Press, 1993.
2. U.S. has been the number one trading partner for the Korean economy until
1999 (IMF, Direction of Trade Statistics, various years).
3. See, for example, Alice H. Amsden, Asia's Next Giant: South Korea andLate Industrialization, New York: Oxford University Press, 1989; or ByungNak Song, The Rise of the Korean Economy, New York, NY: Oxford
University Press, 1997.
4. Noel F. McGinn, et al., Education and Development in Korea, Cambridge,
MA: Harvard University Press, 1980.
5. See Korean Ministry of Education, 50 Years of Education History (inKorean), 1998, for detailed descriptions of Korean education policies.
6. For example, asubstantial number of brains came to the U.S. under the
auspicious of Fulbright Scholarship Programs, East-West Center Fellowship
Programs, Minnesota-Seoul National University Exchange Scholars Program,
Ford Foundation, U.S. International Cooperation Administration, and so on.
7. For a critical evaluation of recent roles of U.S. trained Korean economists inthe economic policy makings, see Alice H. Amsden, "The Specter of AngloSaxonization is Haunting South Korea," in Korea's Political Economy: An
Institutional Perspective, edited by Lee-Jay Cho and Yoon-Hyun Kim, Boulder,
CO: Westview Press, 1994.
8. In Yung Chung, Economic Brains in the Hongnung Forest (in Korean),Seoul: KDI Press, 2002.
9. Sunwoong Kim and Ju-Ho Lee, "Changing Facets of Higher Education in
Korea: Market Competition and the Role of the State," paper presented in theWorkshop on Upgrading Korean Education in the Age of Knowledge
Economy: Context and Issues, sponsored by Korea Development Institute andthe World Bank, October 1 6 - 17, 2002, Seoul, Korea.
10. For more detailed information on current problems and issues, consult Se-U
Park, et al., editors, Transition of Primary and Secondary Education in Korea:
Enhancing Autonomy and Accountability (in Korean), Seoul: Korea
Development Institute, 2002.
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11. Ju-Ho Lee and Sunwoong Kim, "Economic Analysis of School Policy andPrivate Tutoring (in Korean)," Economic Analysis of Korean Economy (inKorean) 2(2), 2002.
12. Susan T. Hill, Science and Engineering Doctorate Awards: 2000, NSF 01314, Arlington, VA: N.S.F., 2001.
13. These figures include any partial support by the University or thegovernment.
14. See Vinod B. Agarwal, "Immigration of Engineers, Scientists, andPhysician and the U.S. High Technology Renaissance - A comment," Social
Science Quarterly 1\ (1), 196-98.
15. Jean M. Johnson, Statistical Profiles of Foreign Doctoral Recipients inScience and Engineering: Plans to Stay in the United States, NSF-99304,
Arlington, VA: National Science Foundation, 1998.
16. Korean Council for University Education Council, University Education (inKorean), Jan-Feb, 2000.
17. Kang-Shik Choi, "The Impact of Shifts in Supply of College Graduates:
Repercussion of Educational Reform in Korea," Economics of Education
Review 15, 1996, 1-9.
18. Most "part-time" instructors do not have other meaningful occupations, butteach several courses, sometimes in several schools simultaneously.
19. The plight of part-time instructors has been intensified by the suicide of along time part-time instructor at Seoul National University in June 2003. There
has been an effort to organize a labor union for part-time instructors recently.
For more information, visit www.kangno.com.
20. IMD, World Competitiveness Yearbook - 2003.
21. Hankyoreh Daily Newspaper, www.hani.co.kr. February 19, 2003.
22. For more information, visit U.S. National Center for Education Statistics,
www, nces.ed. gov.
23. Similar concern was expressed by the Germans, who contribute the largest
number of post-docs to the U.S. in Europe. See Center for Research on
Innovation and Society, German Scientists in the United States: Challenges forHigher Education and Science Policies, 2001, German Federal Ministry of
Education and Research.
24. On the other hand, the breakdown, of the long-term employment system ofmajor private companies also increased the demand for U.S. educated Koreans
for their mid-manager or manager positions. In particular, those who obtainedMBAs in the U.S. have been in high demands from Korean private companies
after the financial crisis.

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