The Numbers Behind The Rankings
Dean Robert Bruner of the University of Virginia’s Darden School of Business is an astute observer of graduate business education and the MBA game. In a recent post on his excellent blog, Bruner opined on the winner-take-all theory as it applies to higher education and business schools in particular.
“Today, higher education resembles a winners-take-all market,” he concludes. “To win is great, gratifying, and reinforcing. But striving to be one of the winners is fraught with great difficulty: heavy investment, long duration with slow advancement, and serious temptations to err—it may place the school on a long and weary treadmill that is unsustainable and ultimately dangerous.”
The most fascinating part of his observations are a series of charts that show how the highest ranked MBA programs tend to have the best stats on every key metric of quality, from average GMAT scores to the number of articles published by faculty in academic journals. In fact, perhaps the most surprising insight from his analysis is the remarkable correlation between a school’s ranking by Bloomberg BusinessWeek and the publication record of its faculty (see on following pages)–especially because the academic research only accounts for 10% of the BusinessWeek ranking.
It’s pretty much what you would expect to see. But reduced to chart material, it makes a strong point: the most highly ranked schools benefit greatly from their relative position on such lists, getting better students, faculty and funding. It’s also why striving to get into a highly ranked school is more likely to payoff.
‘A SELF-REINFORCING PERNICIOUS CYCLE’
“As applications, quality of students, donations, and affirmative media coverage fall, so do rankings,” believes Bruner. “And the cycle continues: more doubt and disbelief; more declining relative performance; fewer rewards. The school stalls, and then nose-dives. This is a self-reinforcing pernicious cycle.”
Bruner points out that the two most prominent attributes of winner-takes-all markets are that “(1) assessment is based on relative, not absolute, performance, and (2) that rewards are concentrated in the hands of a few top performers. Higher education models these attributes well.”
Here’s his assessment (and his charts with apologies for the less than perfect appearance of them):
Admissions selectivity. “Reward” could also be measured by the ability to recruit excellent students. Consider some evidence from US business schools. One metric would be the selectivity ratio of admissions (the number of offers of admission divided by the number of applicants). This graph shows that the higher the rank, the more selective the admissions.