International Journal of Arts & Sciences, CD-ROM. ISSN: 1944-6934 :: 5(5):109120 (2012) Copyright c 2012 by UniversityPublications.

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THE AMERICAN STUDY ABROAD INDUSTRY IN ITALY

Ren M. Du Terroil Educational Program Consultant, Italy Michael D. Santonino III Embry-Riddle Aeronautical University, USA

The authors evaluate two main business models that represent the American study abroad industry in Italy, a lucrative education system that continues to exploit and transform an industry as an integral part of the Italian culture in many cities and regions. Several factors are analyzed in the cost of programs, ownership and operational functions, outsourcing program providers, quality of programs, Barile Law factors and other organizational formations. These programs do not always translate to a quality educational experience for students. Keywords: Study abroad, AACUPI, Association of american college and university programs in italy, International education, Barile law.

Introduction The Wall Street meltdown quickly wiped out three trillion dollars worth of financial assets with the United States Government providing the safety net to bailout the global financial system in 2008. Yet, in 2008-2009 there was only a slight decline (less than one percent) in study abroad numbers. A new survey by the Institute of International Education (IIE) and the Forum on Education Abroad has found that study abroad by U.S. college students was on the rise in 2010-2011 (Open Door, 2011). This recent online survey data indicated that an upward trend is continuing for study abroad for academic credit. Europe still hosts the largest number of students with the top five destinations: United Kingdom, Italy, Spain, France, and China. Non-traditional destinations like China are seeing growth and becoming more popular as students look for alternative choices. Study Abroad is fast becoming a critical component in higher education in America, with recognition that the experience results in intellectual, global/cultural, and personal growth for its participants (McKeown, 2009). With the infused investment of $97 billion from the American Recovery and Reinvestment Act to the U.S. Department of Education (DOE), it is a clear indication that the American Study Abroad Programs will gain momentum for global and economic competitiveness in which political hopes are to transform its path to restore Americas leadership in higher education. For example, the DOE will fund $230,000 to cover students' expenses at Bakersfield College. The new joint Atlantis Program will strategically align itself with a university in Italy and another in Spain with a goal to train students to become teachers (Barrientos, 2012). According to the DOE, seventy-five applications were submitted to participate in the $16 million program with 26 selected

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nationwide. Much of the political push to make the U.S. a leader in education will be to give more American college students an international education. Americans find themselves at a distinct disadvantage when competing globally in business and industry as well as issues of the quality of the programs that will provide this critical training to future generations of college and university students (Bricault, 2002). The global challenges that face the U.S. in the Middle East and economic challenges from emerging countries (i.e. China, India, Brazil, and Russia) will require educational readiness to meet this new world economy. Over the last 50 years Italy has emerged as one of the main center for U.S. study abroad programs, most notably the region of Tuscany hosting a large number of universities and programs. Various models of study abroad programs are designed around its' American hub using creative ways to attract, retain and sustain student enrollment and globally minded faculty. Many innovative models are being utilized by U.S. universities to impact enrollment, market appeal, capacity management and altering perspectives of American students who are not participating in study abroad programs. Over the years many European governments and institutions of higher education reacted in the so-called Bologna process to what they perceived as globalization pressures by standardizing the lengths of study programs and types of degree (Haug et al. 1999; Haug and Tauch 2001; Teichler 2001). The phenomena of Europeanization most frequently referred to since about 1990 were initially horizontal mobility and cooperation (notably the European Region Action Scheme for the Mobility of University Students (ERASMUS)) and subsequently standardization of study programs and degrees (Teichler, 2004). Research findings from Trooboff, Vandeberg and Rayman (2006) indicated that employers did value study abroad when hiring recent college and university graduates and this value was increased if the experience supported language acquisition. The manuscript explores important topics that must be addressed to restore Americas leadership in higher education. Such topics proceed as follows: A brief historical perspective of the study abroad industry in Italy, integrative initiatives through experiential learning models, labor conditions and some final thoughts in the conclusion. A Historical Perspective of the U.S. Study Abroad Industry Affiliations That Shuts Out the Competition With no regulations governing study abroad programs, many institutions develop them using the partnership model with U.S. and Italian universities selecting students for regional placement for study. According to Amy Bartnick-Blume, a vice president of the non-profit Institute for Study Abroad, which is affiliated with Butler University in Indiana, said the institute gave colleges with which it has exclusive agreements up to $500 per student for restricting them to the institutes programs in a given region (Schemo, 2007). From an historical perspective, partnerships between U.S. and Italian universities have in effect shut out the competition for years. There is no shortage of students when new innovative program schemes continue to pop-up through Italy. For example, during the fall of 2009 Freshman abroad program had 50 students participating in study abroad experiences their first semester in Italy, with over 200 potential students on the waiting list for this University of New Haven program (Boronico,2010). General Models of Study Abroad There are two main types of program models in Italy. The classic Island Program and the Hybrid Program. The classic Island model outlined in figure 1.0 can either be hosted at an off-shore campus of a U.S. university, such as Gonzaga University in Florence, Georgetown University in Florence or Florida State University in Florence. Another model can be at a study center that houses multiple sending U.S. universities as well as the ubiquitous third party provider such as the Accademia Italiana, Florence

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University of the Arts or Lorenzo de'Medici. For example, Arcadia University is affliliated with the Accademia Italiana in Florence (Arcadia University Website, 2012). In both of these cases students attend courses held strictly conforming to U.S. academic standards regarding number of contact hours, required coursework and evaluation methods. Demographically all students are generally U.S. nationals although non-U.S. students may participate in the study abroad programs. This happens in the case of the foreign student studying in the U.S. who choose to go abroad or a non U.S.-based student that frequents an U.S. style university outside of the United States or that is a pay as you go special program for students at the host institution in Italy. Student services, facilities and academics are nominally the same at all institutions and very often reflect the character of that particular school. However, budgetary and financial flows work in a very different manner.

Figure 1. The Classic Island Program Model.

The Barile Law (Legge Barile) According to the Association of American College and University Programs (AACUPI) in Italy, U.S.based university programs enjoy a special status in Italy due to the Legge Barile. This legislation was finally approved on January 14th, 1999 after many years of legal and fiscal uncertainty for U.S. universities operating in Italy. For many years AACUPI lobbied the Italian government to recognize the non-profit status of the offshore campuses of U.S. universities in Italy. Following passage of the law, U.S. universities were recognized by the Ministry of Education with the same non-profit status as Italian universities. Thus, their fiscal obligation towards the Italian state is limited to the Italian regional production tax (IRAP, known as the Imposta regionale sulle attivit produttive) and payroll taxes for their staff and faculty. The main provision set forth in the Legge Barile is that the aforementioned schools may not register students or collect tuition or monies of any kind on Italian soil. While this has proved a great help for universities in Italy following this type of program model, in some ways one can argue that it further isolates the island programs. The other type of program, the study center model operates as per Italian laws and regulations for private schools. Thus, they are liable for all corporate and income taxes as well as subject to Italian state accreditation and verification of compliance. Over the past two decades, Italy has gone through a process of devolution, whereby the national state powers have been transferred to the regions. As a result, accreditation on the part of the state is generally limited to a regional accreditation on

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the level of a vocational program in the United States. Furthermore, many if not most of the private Italian schools that have the national level accreditation from the Ministry of Education (MUIR) are only accredited by the state for Italian language and culture courses. Third Party Providers are agencies that sell academic year, semester and summer programs both for U.S. universities and the Italian-based study centers. The study centers rely primarily upon a combination of third-party-providers and direct agreements with U.S. universities in order to maintain and grow their enrollments. Traditionally, U.S.-based programs relied exclusively upon their home campuses or sisterschool arrangements for students but increasingly they are relying upon third party providers and also acting as agents themselves, selling not only their own programs but also those of other providers. Service Providers In Florence alone there are over 100 schools and centers that provide programs for international students. As a result, numerous complimentary service providers have developed over the years. Initially associated businesses were limited to the English language bookstore and housing agents. As demand grew so did the number of businesses and the types of services they offered. Past attempts to gauge student numbers have put them at 10,000 in the year 2000 for all of Italy with 43% of the students in the city of Florence (AACUPI, 2008). This impressive number only reflected students enrolled in U.S.-based university programs. There are many new types of programs that students now attend as well as those who attend Italian institutions that are not included in these studies. The numbers of schools and students are complimented by very competitive service providers that are essential to the operations of the industry. The main service providers include real estate agencies, communication services (cell phone rental and internet providers), private health practitioners and student tour companies. The real estate agencies provide perhaps the most important service a school needs after academics. Agencies contract with private landlords for student apartments. Basically, individual institutions contract for a certain number of beds, locations and standards as per their program either for set dates as per the academic calendar or take a certain number of apartments for specified periods. Agencies generally provide maintenance and emergency services for their properties. This is a very challenging area as the combination of large student numbers, high standards and expectations on the part of the students, pressure from the contracting institutions, multiple landlords and maintenance issues spread throughout the city makes this the most problematic area for both parties. There are also multiple providers for cell phone rental whose market is exclusively foreign students. These providers hand out free cell phones at student orientations and even have operations in the U.S. that will mail the student their ready to go Italian cell phone before leaving for Italy. Students accepting the service receive a monthly statement for outgoing calls which is debited to a credit card. In addition to cell phone services, these providers also arrange for internet in student apartments which is generally not provided. The main cellular providers in Italy, Vodaphone and TIM now actively market their services to foreign students as well offering numerous plans as well as having walk-in stores and service centers throughout all Italian city centers. Student health is increasingly an issue due to large numbers of students. Institutions rely very often upon private medical practioners and clinics to provide student care. U.S. students must have insurance to cover them for the Italian public system. In the past this was done with an Assitalia policy, later many instituions added private international health insurance (which is sold via home universities and thirdparty providers) in order for students to obtain their student visa and subsequent permit of stay. Often times students can be over-insured as they might be coveraged under multiple policies (insurance from the university, parents and third-party provider and/or host institution. Thus many institutions favor sending students to practitioners and clinics that take the private international insurance. However, any type of emergency and inpatient care is invariably through the Italian national health service. A relatively new phenomenon are student tour companies that sell organized group trips throughout the academic year to European and North African destinations. These trips are designed specifically for

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students and their dates coincide precisely with the traditional three day weekend as well as semester breaks. Most of the providers are foreign companies that operate legally via an Italian travel agency in order to sell their product. These companies aggressively market both institutions and students with their services. Personal travel is listed as one of the main motivations for U.S. students to study abroad. In the past students would travel by train employing the Eurailpass. With the advent of low cost airlines and the opening of secondary airports there was a surge of independent student travel in the early 2000's. Now these student tour companies represent a large portion of the total student travel while abroad. Integrative Initiatives to Promote and Support Study Abroad The ever-expanding globalization of manufacturing and industrial processes shaped new markets and spurred new ways of building projects (Dubikovsky & Ropp, 2007). General Electrics (GE) recent $500 million dollar investment in technology, manufacturing and support operations at its Florence and Massa Italy facilities may be indicators of shaping new markets for Italy. Perhaps, integrating educational practicum with GE as a partner into the American hub of study abroad programs could help transform traditional language and culture experiences of students. According to the American Council on Education (ACE), most institutions core academic activities in international education are poorly integrated into programs, hence, marginalizing the aspect of undergraduate education with respect to student preparedness that demonstrates campus internationalization. By defining internationalization as an integrated process that is part of the institutions long-term strategic plan will require pedagogy, curriculum and learning outcomes, operational funding, competent faculty and staff to transform old institutional models to new global initiatives in education. Italy will play an important role for those schools positioning for this global change in education. It is undeniable that there are fundamental differences in the academic and cultural experience offered by study abroad programs today (Engle & Engle, 2010). The new global initiative that is shown in table 1.0 goes beyond the level-five model that Engle and Engle (2010) called the Cross-Cultural Immersion Program. American institutions use various al la carte programs to cater to different student needs, which has resulted in poor quality programs (i.e. watering down) to keep the flow of enrollment. The New Global Initiative Model can be modified to adapt various issues, such as; programs length. However, programmatic efforts must account for quality programs that demonstrate integrated business experiences within those different program lengths. For example, shadowing a business manager at a local corporation for one week as part of a two week program session in Italy that would be part of the course curriculum for universities course in Principles of Management for international business majors. Consider the following proposition model:
TABLE 1. School of Business at XYZ University. Traditional Model Courses: Traditional course have been Italian Renaissance Art, Architecture, History, Italian Language, and Literature courses. Additional course offerings have expanded to other areas, such as; International Business, International Management, Productions and Operations Management, Principles of Management, Organizational Behavior, and Introduction to Marketing. Semester: a one-month summer term. Language: requiring little or no host language proficiency, with subject-matter classes in English. New Global Initiative Model Course: International Business, International Management, Productions and Operations Management, Principles of Management, Organizational Behavior, and Introduction to Marketing. Semester: at least a full-year program for students directly enrolled in local university courses or developed by host university Language: advanced linguistic proficiency Faculty: Highly motivated full-time American and Italian faculty co-teaching or collaborating with local networks of businesses. Length of stay can vary from

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Faculty: American faculty who are interested in overseas summer assignments. Housing: collective housing of American students and roommates. Field Trips: mostly cultural experiences to various cities, vineyards, cooking classes, walking tours and other student activities driven by cultural-fun for students. Student Learning Outcomes: Cultural learning experiences and academic credit earned for enrolled course based on the standards defined by the program.

weeks to months. Housing: housed individually by a host family Field Trips: service learning, or other professional internship or practicum project developed using local governments, small businesses, manufacturing facilities (i.e. GE in Florence, FIAT in Turin) or other structured experiential learning that integrates business disciplines and cultures. Integrating the course with experiential learning that goes beyond language and cultural experiences to a fully integrated business experience with practitioners, operations managers, property owners, executives, and other levels of practicing management functions related to the course concepts. A highly integrated practicum that is part of the curriculum that is sustainable over time. Student Learning Outcomes: Cultural experiences integrated with business-knowledge from experiential learning that measures valued-added activities (i.e. direct and indirect methods).

Note: Eagle & Eagle (2010) proposed level 1 through 5 as Study Tour, Short-Term Study, Cross-Cultural Contact Program, Cross-Cultural Encounter Program and Cross-Cultural Immersion Program, respectfully.

Figure 1.

This model in business was developed to understand what managers do from the research in the early 1970s from Henry Mintzberg. Typical case study analysis, textbook assignments and other traditional classroom pedagogy methods exclude the practice of management from the perspective of the international manager (i.e. the Italian business owner or the Turin factory plant manager) integrated into the curriculum on a consistent basis. Cultural encounters are not a goal of this kind of experientiallearning model. Mintzberg would claim the art and science of management must be balanced in order to understand the practice of managers. Mintzberg would reject the classic study abroad experience in Italy,

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for example, a Principles of Management course with business majors that includes the art-history tour, with group hotel accommodations, morning lectures, museum visits, guided walks and other excursions unless students were to shadow managers to learn what they do! Scholarly work in educational development by Mintzberg states, for example, Masters of Business Administration (MBA) programs give the impression of developing managers, but they don't. There's very little management in them and mostly of what is in there about management tends to be distorted, because you can't create a manager in a classroom (Mintzberg, 2003). Management education doesn't mean a lot to those who have no experience in the practice of management. But for those who do have such experience, management education can be profound (Mintzberg, 2003). Therefore, using Kolbs learning cycle model in figure 1.0, experiential educators can structure learning objectives, learning outcomes, and evaluation strategies (Montrose, L. (2000). This model is a useful tool for understanding the process by which students abroad integrate experience, such as; hands-on problem solving and critical thinking with the analysis of their experience. The likelihood of this pedagogy that is fully integrated in business courses and program are hard to find in Italy. The courses that provide such experiences for business students are driven from the start by faculty and end with the faculty driven initiatives for this to happen over a sustainable period of time. An example of a successful program that is built with faculty members that work closely with participating companies is the International Masters Program in Practicing Management (IMPM). Unlike traditional class setting course work this study abroad type program attracts participating managers and faculty to probe deeper into analysis of real-world problems at various businesses. The Participants are typically 35-55 years of age with over 15 years work experience (IMPM, 2012). An impressive list of companies included: Alcan, BT, EDF Group and Gaz de France, Fujitsu, LG, Lufthansa, Matsushita, Motorola, Royal Bank of Canada, and Zeneca (Gosling & Mintzberg, 2003). As stated earlier, integrating such an educational practicum on a consistent basis for all students going through courses to experience can only be provided through collaborative partnerships, such as with GE. This experiential-learning method would help transform schools from the traditional language and culture experiences that study abroad programs offers students to a more integrated approach with practical value-added international experiences in business. The proposed New Global Initiative Model on table 1.0 is an example of how study abroad programs can begin to transform from the cultural fun to a more integrated approach that develops strategic partnerships in business as more and more courses are offered in Italy for study abroad. Much of todays environment at institutions of higher education are continued to be scrutinized by external stakeholders until they provide evidence of improved institutional quality (Koslowski, 2006). Study abroad programs in Italy are not exempt from such scrutiny, as it has recently seen an increase of general education and business intro classes targeting lower-classmen to drive enrollment numbers. According to Dr. Brian J. Whalen, President and CEO of the independent organization called the Forum on Education Abroad, we lack precision to our (study abroad) programs, let alone a way to measure what we're accomplishing" (Farrell, 2007). Evaluating and monitoring study-abroad programs by an independent organization, can help drive universities and colleges to look more closely at standards of good practice, but much is little practiced and poorly understood in the assessment process. This is still a nascent research area in study abroad (Koslowski, 2006). Therefore, until the American study abroad programs began to rethink and transform themselves into highly integrated models that are part of the curriculum, quality issues continue to be questioned as a watered down (poor quality) course offering during students experience overseas. Lack of Interest Still Exist for an Integrative Approach The University of New Haven (UNH) claims that integrating experiential education into their degree programs has strengthened its study abroad program (Boronico, 2010). The College of Business found its number of faculty led programs went from 1 to 24 from the summer 2006 to summer 2010. Research

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findings suggest UNHs integrative approach working for all stakeholders to sustain its global learning environment. It is not implied that such an integrative approach follow buy-ins from others in education. The Institute of International Education (IIE) survey suggested that there is still lack of interest on part of faculty in integrating study abroad into their programs (Boronico, 2010). The lack of interest of faculty from the IIE survey is not surprising, as a majority of faculty that work in Italy are adjunct and work contract to contract. We will explore some of the labor conditions in Italy in the following section. Labor Conditions for American Study Abroad in Italy Until recently, many of the faculty and staff in many programs and schools employ ad-hoc remedies regarding labor contracts. There is however a marked difference between the two employment contracts that may be used for both staff and faculty. In Italy, there is the traditional status as a dipendente that is an employee, with full fiscal and social contributions paid by the employer. In addition, this category of employee is entitled to paid-sick leave and holidays. Also, annual bonus paid in the form of a 13th or 14th month full salary and compensation of one months salary for every year employed upon termination of contract (known in Italian as the TFA termine fine rapporti). This type of employment may be for an undetermined period, meaning practically for life or determined meaning for the period specified in the contract. This type of arrangement is generally limited to administration and some faculty. The vast majority of instructors work as adjuncts with the second type of labor contract known as a cocopro or project contract. This contract generally specifies the course, date, and gross amount to be paid, but does not and cannot go in to detail regarding working hours as it is considered a consultancy. The advantage of this type of arrangement is that the number of courses and contracts is without limit and allows the greatest degree of flexibility for instructors. Until recently this type of contract was not considered as valid as the dipendente employee when applying for a bank loan. In addition, the social contributions, while almost the same percentiles as the dipendente employee provide for a very minimum retirement income. Most programs and universities require high qualifications to teach on their programs. However, no school or program can offer the same standard in terms of infrastructure, libraries and support staff as would be de riguer on the average campus in the United States. This greatly impacts the possibility of faculty to publish, attend conferences and continue research as the economic burden falls entirely upon their own resources. The other change which is reflected in the Institute of International Education (IIE) global statistics on study abroad is the shift to shorter programs. Increasingly, students and universities rely upon summer special/short-term programs to service segments of their student population. This accommodates students that are unable to attend traditional academic year and semester programs as well as offers highly specialized programs that are led by faculty. These types of programs are particularly employed in Italy in multiple disciplines and are offered throughout the academic year. Many of these programs are hosted by and outsourced to both Italian and American institutions in Italy, which has allowed many schools to specialize in offering on-demand academic and personalized student services. In some cases this may help to establish important relationships which could develop into exchange programs (students may attend the partner exchange school) or affiliations (the U.S. school establishes a formal relationship and programs with the providers and send students). In addition, thirdparty providers and independent consultants and agencies also offer such services. Conclusion According to Open Door (2012) a 4% increase of U.S. students received academic credit for study abroad in 2009-2010 over the previous year (totals were 270,604). Italy is number two in terms of total U.S. study abroad students. In academic year 2008-2009 a total of 27,362 U.S. students studied in Italy. The vast majority of these students enrolled in semester or summer programs, which globally account for

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73.1% of all programs. The traditional academic year abroad has decreased in total numbers by almost one percent for every year since 2000-2001 to just over 4% of total U.S. students abroad (AACUPI, 2008). The costs for study abroad reflect both the ever-increasing cost of American higher education as well as the weak U.S. dollar. In addition, the cost of technology infrastructure has added a whole new dimension to the operation of international programs as computer labs and WiFi systems are a standard feature both in facilities as well as increasingly expected in student housing as well. Finally the quantity and quality of student services is under constant pressure as the student base is increasingly expanded to a new generation of students who do not fit the traditional study abroad language and culture based programs. Until recently the traditional U.S. Italy-bound student generally studied Italian renaissance art, architecture and history as well as Italian language and literature. While these subjects are still the mainstay of most programs the vast majority of students are taking courses more related to their major. This had led to a shift in program focus and resources, whereby programs now actively promote required courses in marketing, economics and business administration to satisfy the requirements of their new student base. The expansion of the type of courses offered reflects the shift in majors at universities as well as the average student going abroad. Whereas at one time study abroad was for a certain elite type of student it is increasingly becoming a vehicle for all students. Even still, only a relatively small percentage of students participate in the study abroad experience. This shift in the type of student, the expansion in the curriculum offered the increasing numbers of students and competition between service providers has kept the Italian U.S. study abroad market healthy while several other traditional European destinations have seen decline. Businesses are seeking more competent world leaders with more international skill sets (CED, 2006). There is no doubt that economic and political uncertainty will also be a driver in keeping the Italian market healthy as European study destinations can be considered safe havens. At the time of this writing, the consequences of Italys earthquake, the fate of the financial markets and the uncertainty in North Africa and much of the Middle East will surely have implications for the Italian study abroad market. References
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