Targeting The Top B Schools

Rankings of business schools have long generated controversy, but rarely like the new one from a couple of economics professors, Joel Waldfogel at Yale University and Joseph Tracy at Columbia University. The duo ranks schools by the value they add to students' earning power.

Trouble is, the profs' own schools appear well back in the pack: Columbia ranks 23rd and Yale 63rd, dead last. By their reckoning, Oklahoma State University (No.8) or the University of New Mexico (No.9) add far more value to students than either Columbia or Yale. BUSINESS WEEK places Columbia ninth and Yale in its runners-up category (finishing between 20 and 40); Oklahoma State and New Mexico aren't among the magazine's top 40 schools.

Why the different results? The economists impute salaries for students based on their average scores on the Graduate Management Admission Test and work experience. Then, the economists compare that with average starting salaries, adjusted for cost-of-living differences, and the occupations chosen by graduates. The schools with the highest positive differences rank the highest.

Fortunately Waldfogel and Tracy don't teach in the B-schools but in the economics departments of their respective universities. Yale business school Dean Paul MacAvoy calls the ranking "nonsense," and says his students are smart enough to see that. "At least," he adds, "they're smarter than Waldfogel." The dean of Columbia's business school, Meyer Feldberg, would not comment.

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