Should You Trust The Economist MBA Rankings?

Note on the 2021 Economist ranking

Citing data collection difficulties in a COVID-19 context, as many as 70+ schools decided not to partake in The Economist’s 2021 MBA ranking. Specifically the M7, as well as INSEAD and London Business School, decided to boycott it. Given the publication’s methodology, non-participating schools could not be ranked. Instead of skipping the ranking, or adapting the methodology to rank absentee schools, The Economist chose to rank only the programs that agreed to cooperate. As a result, IESE Business School was awarded the rank of “best MBA in the world”. While IESE is a great school, perfectly “at home” in the top of any ranking, the lack of participation, as well as the caliber of the missing schools, make this claim only partly substantiated. Beyond the pandemic context, it seems plausible that schools may have shunned the ranking in significant numbers because of the volatile results its methodology had produced in the past.

If you are seeking a list of the long-term leaders in MBA education, please see our directory of top MBA programs, which doesn’t focus on a ranking formula, but on the curriculum, class profile, employment report, and culture of each MBA program.

How The Economist Creates Their Global MBA Rankings

The Economist gathers its data according to the following breakdown:

  • School Data – 80%
  • Student Survey – 20%

School data consists of things like average GMAT scores and salaries of the alumni. The remaining 20% contains a qualitative analysis based on individual alumni ratings of factors such as the quality of the faculty, facilities, and the career services department. This ranking is created according to the following weights:

  • New Career Opportunities – 35%
  • Personal Development/Educational Experience – 35%
  • Increase in Salary – 20%
  • Potential to Network – 10%

Each of these four categories consists of both school data and data from the student survey.

General Observations

Although the majority of the data used in the creation of The Economist MBA ranking is quantitative school data, it is worth noting that the results of the student survey, which are arbitrary in nature, will have a pronounced effect on the final result. This weakens the strength of The Economist ranking. Not only do students have no control against which they can compare their school (i.e. they are not scoring their school relative to other MBA programs) but their grading is completely relative to their expectations. Consider a student at a top 3 or top 5 program. These students are likely to be harder on their own school, because they have higher expectations (which are instilled in part by high rankings). Similarly, students at highly ranked–but not top ranked–programs might have average expectations, and are thus likely to be more impressed with the quality of their education.

The Economist also releases four sub-ranking categories that together make up the final, top 100 MBA list. These sub-rankings are interesting to look at, as they help to explain how various MBA programs end up where they do, and in theory, they provide more detail about the strengths and weaknesses of each school, helping potential applicants to make a more informed decision.

Comparing these sub-rankings, one thing stands out: the results differ wildly from category to category. IESE, for example, doesn’t rank 1st in any category, but sits comfortably at the top of the rankings. Michigan Ross ranks highly in Personal Development but is positioned in 20th place for Potential to Network. Indian School of Business ranks number 44 overall, but it’s apparently the second best school in the world to open up New Career Opportunities. Indiana University Kelley ranks number 13 overall, despite its poor performance in Personal Development (number 73).

The Economist Global MBA Rankings, 2021
1.IESE
2.HEC Paris
3.Ross
4.Stern
5.Scheller
6.SDA Bocconi
7.EDHEC
8.Foster
9.Tepper
10.IMD
11.Carlson
12.Warrington
13.Kelley
14.Terry
15.Hult International
16.Kenan-Flagler
17.Warkwick
18.Vanderbilt Owen
19.Wisconsin Madison
20.ESADE
21.York Schulich
22.EMLYON
23.ASU Carey
24.Mendoza
25.Rochester Simon

This disparity raises the question: what are the weights of these sub-rankings based on? Other MBA rankings include an increase in salary as the most important factor for their list; Forbes bases their entire list on it. So for The Economist, why is salary increase less important than New Career Opportunities and Personal Development?

Take another example in UCLA and NYU Stern:

SchoolNew Career OpportunitiesPersonal DevelopmentIncrease in SalaryNetwork PotentialTotal ranking
Scheller4th7th19th40th5th
NYU Stern18th10th2nd3rd4th

Scheller, ranked 5th overall, only earns high scores in New Career Opportunities and Personal Development. The other categories are mediocre to relatively low. NYU Stern scores decently in most categories, yet only ranks one place above Scheller at all overall. Because The Economist does not expand on their rationale for these sub-rankings, we can only conclude that they’re arbitrary in nature, severely undermining the validity of The Economist MBA ranking.

The Economist vs. Financial Times

When consulting rankings, the potential MBA applicant may be struck by the dramatic differences between each list. How can a school rise and fall so markedly across rankings that are presumably measuring the same thing?

By analyzing specific entries from different rankings, we see how these lists do not measure the same thing at all: wildly inconsistent methodologies lead to wildly inconsistent results. We also begin to see how, for each ranking, the arbitrary decision to highlight one aspect of the MBA experience will favor certain programs and penalize others.

The Financial Times, another globally focused MBA ranking, is often read alongside The Economist. The methodology used by the Financial Times can be found on our Financial Times MBA Ranking page. In summary, the methodologies used by The Economist and the Financial Times do not significantly differ, as both use a student survey component and school data, and both privilege quantitative analysis. The Financial Times ranking is different in one important aspect, however; it takes into account the amount of research conducted at each business school. This difference in approach has led to some very interesting discrepancies with the The Economist listing:

The Economist rankingFinancial Times ranking
IESE1st10th
HEC Paris2nd11th
Ross3rd24th
NYU Stern4th14th
Scheller5th55th
**Note: Rankings adjusted to compare only US schools

The Economist’s ranking of the five US schools above differs not only from that of the Financial Times but from all other major ranking bodies. Both Scheller and Ross score significantly higher than they do in other rankings. The lack of information regarding the weights of the sub-categories used by The Economist does not help the situation–outside observers can only wonder at the rationale behind The Economist MBA rankings.

The Economist MBA Rankings: Key Takeaways

As one of the major global MBA rankings bodies, The Economist attracts international applicants who want a broader perspective on top business schools. Unfortunately, a lack of transparency and detail undermines the usefulness of the ranking published by The Economist, especially in light of the fact that some of their entries are so inconsistent with other lists.

So How Can You Find the Best MBA Program (Without Rankings)?

Once you determine roughly which schools you are qualified to attend–and the rankings can definitely factor into this initial list–we encourage you to leave the rankings behind and instead focus on the practical questions that will help you figure out which MBA program will add value to your career. These are simple, practical questions:

Answering these questions will help you find an MBA program that can enhance your career.