New is not always better, and some Indians are in fact wealthier than Americans
Ten parts don't make a whole

Perhaps the Economist doesn't take its own advice

Given the recent post questioning the value of the MBA degree, one would think the Economist powers-that-be would not be staffing up MBAs. But then, if not useless MBAs, how would the Economist explain this chart they printed next to the said article?

Econ_ROItable
This chart appears to tell us that all the top MBA programs succeed in reducing their students' earning potential. In each case, the "pre-MBA salary" exceeds the "salary on graduation".

More likely, the red part is the incremental salary, possibly explained by the value of the degree while the gray part is the pre-MBA salary.

However, since the author has few nice words to say about business schools, one can never be 100% sure if he is presenting some counter-intuitive data.

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6a00d8341e992c53ef0133f5f3e09a970b In the Trifecta checkup, one would find nothing wrong with the chart type, nor is there anything wrong with asking the return on investment of an MBA degree. 

The third component -- having the right data -- is what renders this effort a failure. It is too simplistic to measure return on investment on the salary upon graduation. Surely, one must also include future career paths, intangible benefits from network relationships, personal development, etc.

 

Comments

Peter Chang

One potential way to look at this is the red part consists ONLY of the pre-MBA salary. So for example, for Harvard students pre-MBA they made only 35k and afterwards they made almost 80k.
But it seems too low either way unless this chart is from 1990 or something. Cryptic!

Basil

Reminds me of the infamous saying, "I'm sorry, but your overly qualified for this postion."

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