Expatriation and career success: A human capital perspective

Very little is known about the linkages between expatriation and objective measures of career success. In this field study we address the expatriation-compensation attainment relationship, after controlling for different kinds of international experience, among 440 graduates of elite MBA programs from around the world. The results suggest that a positive compensation return only accrues to repatriates who have experienced more than one expatriate assignment, perceived acquired knowledge and skills to be utilized during post-repatriation periods, and who are working at higher organizational levels. These findings, along with a supplementary analysis, support an explanation of the results based on human capital theory. That is, expatriation relates to compensation attainment because it is an intense developmental experience, and not merely a selection or signaling mechanism. Furthermore, by incorporating the concepts of value of human capital, richness of human capital, and opportunity to display human capital, we provide a stronger test of when and for whom completing expatriate assignments is positively associated with compensation. The results also suggest that there are currently few readily available substitutes for expatriation.