I recently became aware* of a paper by Benito Arruñada and Xosé H. Vázquez that attempts to link the outcome of MBA degrees to the different subjects offered – specifically the proportions of subjects that are based on standard assumptions of rationality and self-interest (called economics subjects in the paper) and those that rely on “human assumptions” (called management subjects in the paper).
In a nutshell they are interested in the proposition that “managers are more successful than business analysts.”
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The analysis is based on FT ranking data and done at the level of the school. The authors do make an attempt to account for he problem of endogeneity of GMAT scores. They conclude that
Controlling for the average quality of their students and some other schools’ characteristics, average salaries are significantly greater for those schools whose core MBA courses contain a higher proportion of management courses as opposed to courses based on economics or technical disciplines.
However, there is a major problem with the findings it seems to me. They measure the success of the course by average salaries (3 years after graduation). There is no measure of management ability. It seems to me that the authors have fallen into the very mindset that they decry. Measuring manager performance by the salary that the graduate manages to negotiate for themselves is precisely how a (rather poor) economist student might think!
I am not at all surprised that those students who major in management subjects (such as human resource management, negotiations and leadership) are better able to find a high paying job than those who major in Finance and Econometrics, poor tongue-tied geeks that they are.
*via Nick gruen at Clubtroppo