The MBA degree and the astronomical rise in CEO pay

Related Articles

• For MBAs, Breaking Even is a More Distant Dream 0 06.Jan
• The best and worst MBA courses if you want a giant salary 0 01.Dec
• Boost to earnings from MBAs falls 0 25.Jan

Companies’ top-ranks are filled with talent from similar educational backgrounds. Uniform thinking could be playing a part in the massive CEO pay gains over the past few decades.

During most MBA programs, business school students read numerous case studies, evaluating the strategies of many different kinds of companies, analyzing the cost of bringing new product lines to market and novel methods to cut expenses. You would think that, after all that training, MBA grads would be the perfect candidates to halt the runaway growth of CEO pay. But, in an ironic twist, could the rising number of MBAs be pushing the perceived value of a CEO ever higher?

The MBA degree’s growth in popularity is one of the few trends in the business world that matches the extraordinary growth in executive pay. According to the most recent data, from the 2011-2012 graduating class, MBA students accounted for 25% of the total master’s handed out, with 191,571 students receiving the degree. Education and computer science/engineering students came in second and third, with 178,062 and 66,014 degree recipients, respectively.

The MBA has grown in popularity for years. In fact, the number of MBAs issued has jumped 623% since 1970; education master’s degrees increased 103% during that time…