The Economist Ranks Babson College No. 2 in the U.S. for Value; Ranking finds Babson alumni earnings to be more than $20,000 above the expected average

Nov 05, 2015, 12:55 ET from Babson College

WELLESLEY, Mass., Nov. 5, 2015 /PRNewswire-USNewswire/ -- Babson College has been named No. 2 in the United States according to The Economist.

In its first undergraduate college ranking, The Economist demonstrates the economic value of a college by comparing the gap between how much money its alumni earn, and how much they might have earned had they studied elsewhere.

The median earnings among Babson undergraduate alumni is $85,500, according to the ranking. That is $20,330 more than their expected earnings of $65,170, had they studied at another institution.

According to The Economist, "… median earnings at Babson, which requires undergraduates to start a company, trailed only MIT and Harvard …" among Boston-area colleges.

"We are pleased that Babson continues to be recognized for the value it provides," said President Kerry Healey. "Our faculty, staff, and their innovative use of Entrepreneurial Thought and Action® continue to position graduates to be uniquely prepared to make a difference in business and in society."

Babson has consistently been ranked high among its institutional peers for the unmatched value its education provides and the success of its graduates. Most recently:

  • MONEY magazine named Babson No. 2 in America, and awarded the institution with a value-added grade of "A" due in part to its average alumni early-career earnings
  • PayScale ranked Babson the No. 1 private business school for salary potential
  • The Princeton Review named Babson one of the top "colleges that pay you back" at No. 14 for return on education and No. 7 for career placement
  • The U.S. Department of Education featured Babson among the top colleges for alumni earnings in its new College Scorecard

Methodology

The Economist's first college rankings are based on a simple, if debatable, premise: the economic value of a university is equal to the gap between how much money its graduates earn, and how much they might have made had they studied elsewhere. Thanks to the scorecard, the first number is easily accessible. The second, however, can only be estimated. To calculate this figure, The Economist ran the scorecard's earnings data through a multiple regression analysis, a common method of measuring the relationships between variables.

The magazine compiled a wide range of factors that could affect median earnings of college graduates, both from the recent U.S. Department of Education College Scorecard, as well as other complementary sources, including the wealth of the state, wage averages among cities, other undergraduate rankings, and more. Culled data from the College Scorecard includes average SAT scores, sex ratio, race breakdown, college size, whether a university was public or private, and the mix of subjects students chose to study. After feeding this information into a regression analysis, The Economist produced an estimate for each college, based exclusively on these factors, of how much money its alumni would make.

About Babson College

Babson College is the educator, convener, and thought leader for Entrepreneurship of All Kinds®. The top-ranked college for entrepreneurship education, Babson is a dynamic living and learning laboratory where students, faculty, and staff work together to address the real-world problems of business and society. We prepare the entrepreneurial leaders our world needs most: those with strong functional knowledge and the skills and vision to navigate change, accommodate ambiguity, surmount complexity, and motivate teams in a common purpose to make a difference in the world, and have an impact on organizations of all sizes and types. As we have for nearly a half-century, Babson continues to advance Entrepreneurial Thought and Action® as the most positive force on the planet for generating sustainable economic and social value.

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