Category: Education

An Overview of Recent Enrollment Declines in MBA Programs

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MBA Programs
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Dr. Antonios (Tony) Antoniou received his BA in economics from Sunderland University and his MSC in accounting and finance from the London School of Economics. Dr. Antoniou also holds a PhD in applied economics. An experienced professor of finance and economics, Dr. Antonios Antoniou stays informed on all the latest academic business trends.

In the past, a master of business administration, more commonly referred to as an MBA, represented a laudable academic achievement. More recently, however, employers’ interest in the degree has fallen, a trend either reflected or influenced by an enrollment decrease in MBA programs.

The MBA’s decline may extend as far back as 1985 when an article in The Wall Street Journal noted that as many as one in four of the nation’s 600 business schools might be forced to shut down due to diminishing enrollment. Eight years later, The New York Times published a similar article, this time specifically calling into question the professional value of the MBA.

By 2005, the trend had reached the nation’s most prominent and respected business institutions. A Businessweek article found that each of the magazine’s top-30 MBA programs experienced a minimum enrollment decline of 30 percent over the previous seven years, with some falling at a rate of 50 percent or higher.

Speaking to The Economist in 2016, experienced staffing and recruiting professional Debbie Goodman-Bhyat determined that, from an employer’s perspective, the MBA has essentially fallen to the level of a bachelor’s degree. Thousands of MBA or equivalent programs are available to students around the world, leaving employees to dig deeper when searching for talent.

Furthermore, the abundance of MBA programs has led to questionable quality. A study in India found that of the 5,500 Indian business students graduating each year, only 7 percent are considered employable because of their schools’ poor faculties and inferior facilities.

Nobel Prize-winning Game Theory Solutions to International Conflict

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The Strategy of Conflict
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The head of Financial Research, Training & Consulting, LLP, Dr. Antonios (Tony) Antoniou previously engaged as professor of finance at Durham University in the United Kingdom. Dr. Antonios Antoniou has a strong interest in finance and banking systems, and is particularly drawn to the way in which economic interests can be a vital tool in conflict resolution.

In 2005, a pair of researchers spanning the University of Maryland and the Hebrew University of Jerusalem earned a Nobel Prize in economics for employing game theory in examining conflicts between corporations and nations. Game theory is an interactive analytical framework that provides a way of evaluating strategies ranging from wars to international trade agreements.

The scholars’ groundbreaking work examined how cooperation is successfully enacted among certain groups of countries and organizations while others remain conflict prone. They built on research extending to the 1950s and Prof. Thomas C. Schelling’s classic book The Strategy of Conflict (1981), which illustrates how significantly worsening one’s options can strengthen one’s competitive position, and that maintaining ability to retaliate is often more vital than resisting attack.

Seen through a Cold War lens, these insights had an outsized role in defining efforts to avoid nuclear war and negotiate an end to seemingly intractable conflicts.

Are MBA Programs Still Relevant?

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MBA Relevance
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Dr. Antonios (Tony) Antoniou is a prolific writer and consultant with extensive experience in business, finance, and economics. As such, Dr. Antonios Antoniou stays abreast of field-related issues, such as questions about how MBA programs hold up amid today’s economic realities.

Since 1985, the demand for traditional two-year MBA programs has dipped periodically and leveled off in recent years. In an era of recession where there is a growing demand for entrepreneurship and a need for innovative solutions to the world’s problems, some believe that MBA programs as they currently exist may not offer enough to students who want to succeed today.

Some MBA programs are answering to these issues by innovating their teaching models. Here, students can look at real companies in their startup phase rather than simply at case studies, and are being trained to think more like entrepreneurs.

Even the traditional MBA programs still have benefits, however, at least on the financial level. Students are usually able to pay back their investment within 3.9 years, and graduates from accredited schools typically have salaries that are 50 percent higher than what they were earning before they went to business school. As these programs innovate and offer more useful real-world information, graduates may indeed still find success from achieving a MBA.

Is the MBA Relevant?

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MBA

A graduate of the London School of Economics, Dr. Antonios Antoniou provides financial and educational consulting services to clients. Dr. Tony Antoniou formerly served as a dean with the Durham Business School, which offers a master of business administration (MBA) degree.

In recent years, universities have seen a decrease in applications for MBA programs. While data show that the number of annual graduate degrees in business increased by more than 100,000 between 1970 and 2009, the number of MBA recipients has dwindled. However, these degrees still provide a wealth of opportunities to graduates, particularly if they come from any of the top-tier business schools. In fact, most MBA recipients find work within months of graduating and earn more promotions to management positions than those who hold other degrees. Entrepreneurship-focused degrees can also benefit those looking to start their own businesses by helping cultivate strong financial and marketing skills.

Despite these professional advantages, many MBA programs are struggling to remain relevant in the ever-changing economy. With most prominent business schools costing $100,000 in today’s economy, many students seek more cost-effective educations in the form of specialized programs. Numerous institutions have introduced such one-year programs as a master of finance and a master of management to cater to the developing financial and educational needs of students. At the same time, MBAs provide a more comprehensive business education than specialized degrees, making it a worthwhile investment in the face of the diversified graduate degree programs.