The Financial Times Historical MBA Rankings

Chicago's Booth School of Business

Chicago’s Booth School of Business

You’d be hardpressed to find a business school that can match the University of Chicago’s Booth School of Business’ gains in both excellence and prestige over the past dozen years.

The quality and diversity of Booth’s students has seen singificant improvement, with average GMAT scores for the latest entering class now 719, up from 687 in 2001. Women now represent nearly 36% of the class, up from just 27% some 12 years ago, and international students total a third of the class. Last year’s average starting salary for graduating Booth MBAs hit $113,220, up 33% from the $85,000 average in 2001.

No less impressive, over the past 12 years Booth has tripled student scholarships and doubled its endowed chairs, allowing the school to hire and to retain more senior faculty than ever before. The school’s endowment–perhaps the best single metric of its health–has never been higher: $511 million, more than double the $197 million it had in 2001. And the endowment, no less, doesn’t even include a $300 million gift the school received in 2008 from alumnus David Booth. It is the largest gift ever made to a business school.

Few schools can boast as distinguished or as rewarded a business faculty than Chicago which lays claim to six Nobel Prize Winners. Eugene Fama, widely recognized as the “father of modern finance,” became the first recipient of three major prices for finance research in the past seven years. Booth professor Christopher Yenkey and Ronald Burt captured major awards from the Academy of Management last year for their cutting-edge work on networks. Earlier this year, Booth professors Erik Hurst and Tobias Moskowitz won the prestigious Kauffman Prize Medal for distinguished research in entrepreneurship.


Yet, when you consult The Financial Times’ rankings of the best global MBA programs, you would think Chicago is in a deeply troubled freefall. Booth went from being ranked fourth in 2001, behind only Wharton, Harvard and Stanford, to 12th place this year, its worst showing in the past dozen years. Against the school’s dramatic improvement during this same time span, the eight-place drop defies rational explanation or reason.

That’s especially true when viewed against The Financial Times ranking for the school that has placed ahead of Chicago both this year and last: the Indian Institute of Management (IIM) in Ahmedabad, India. The differences between these two institutions are stark and dramatic, yet they sit next to each other in The Financial Times’ rankings. IIM debuted at a ranking of 11th in 2011 after never having been ranked among the top 100 MBA programs by the British newspaper in the previous ten years. Yet, its graduates reported average starting salaries last year of only $29,181–more than $84,000 less than Chicago’s MBAs. IIM’s graduates who stayed in India made even less: just $25,679, not even as much as the average signing bonus of $27,680 for a Chicago MBA last year.

What’s more, IIM’s student diversity is among the weakest of any business school in the world: only 6% of its students are female and only 7% are from outside India. Its endowment is virtually non-existent. A campaign launched in 2008 to raise $50 million in an alumni endowment fund has reportedly raised less than $2 million in three years. Chicago has 38 MBA alumni clubs scattered all over the world, a testament to its truly global reach, while IIM has a half dozen alumni chapters outside of India. And IIM’s faculty, however good by Indian standards, is no match whatsoever for Chicago with its half dozen Nobel laureates. Even the Financial Times’ own analysis ranks IIM 94th out of 100 schools in faculty research published in the 45 top scholarly journals, compared to Chicago’s research rank of sixth place.


So how can The Financial Times justify ranking the Indian Institute of Management in the same league with Chicago Booth? Never mind giving IMM a better ranking than Chicago.

It is one of the confounding puzzles of the rankings game. No matter who does the survey or how the ranking is put together, peculiar findings are common. They occur because of methodologies that are rife with metrics that often have little if any relationship to the true quality of a business school or are based on highly flawed surveys that can lead people to very odd assumptions.

Related Stories:

U.S. News & World Report’s Historical MBA Rankings — 2012 to 2001
BusinessWeek’s Historical MBA Rankings — 2010 to 1988
Ranking The Rankings