Poets and Quants just posted some data on the long-term salaries and earnings of MBAs by school. Conveniently, seven of the top eight school by 20 year earnings were the "top 5" schools I've called out. So one might guess that there's a relationship between a school's rank and its students' earnings, which would be logical.
But I'm less concerned about rankings and more interested in return on investment. So I threw together some quick graphs that look at earnings against cost per year of the program and average student loan debt at graduation. Do you see any trends?
On all three of the earnings data points (Total earnings over 20 years, Median pay 20 years out and Median pay 10 years out), Harvard comes out on top. Sometimes by a little, sometimes by a lot. Stanford and Wharton are Harvard's closest competitors. So congrats to all the Harvard folks out there, you're in the money.
What also struck me though is that neither cost or average debt were significantly correlated with any of the earnings metrics. Debt correlated best with median pay 20 years out with an r^2 of .05, not linearly related at all, and was worse for the rest. Total cost fit better with an r^2 of .6 for median pay 10 years out and around .2 for the two other earnings metrics. But basically it's hard to say you get what you pay for with an MBA.
Instead, average ranking was a better fit with an r^2 of .6 for median pay 20 years out and .5 for pay 10 years out and earnings over 20 years.
Kellogg is a big exception here, but overall rankings may actually have some predictive value. Better than I thought certainly. So maybe I need to revise my idea that Harvard and Stanford are the best MBA deal and just go out and say Harvard is the best deal for an MBA. Though the difference isn't as significant as it looks in these graphs since the scales have been changed to fit the data, on a scale from zero the differences would look a lot smaller.
What do you think? What trends do you see in this data?