The University of Chicago Graduate School of Business is the second-oldest school in the US and was founded in 1898.

The University of Chicago's Graduate School of Business has claimed top spot in the Economist Intelligence Unit's 2007 ranking of full-time MBA programmes. It is the first time the school has led the annual ranking, which is now in its sixth year. Chicago toppled the Spanish school IESE, which had ranked in first place for the previous two years; IESE drops to third position. Other schools in the top five are Stanford, Dartmouth (both US) and IMD in Switzerland.

With three European schools breaking into the top ten this year—Cambridge, Instituto Empresas and Henley—the top of the ranking is now split equally between the US and Europe. Hong Kong University of Science and Technology, ranked 20th, is Asia's highest placed school.

Much of Chicago's success can be put down to the record of its careers service. This is now one of the key competitive battlegrounds between schools. Indeed, when the Economist Intelligence Unit asked prospective MBA students why they had decided to study the degree, opening new career opportunities was the most popular reason given. Chicago's careers office is rated as the world's best by its students. Within three months of graduation 97% of Chicago students are in jobs, the vast majority of them facilitated by the careers office.

Bill Ridgers, the editor of Which MBA?, commented: "The quality of a school’s career service is becoming much more important. In the past a high proportion of MBA graduates trod the well-worn path from business school classroom to consultancy firm. But now students' needs are more diverse. Jobs in sectors that were barely on schools' radar ten years ago, such as private equity or real estate, are now demanded. It is those schools that can cope with the new demands that really stand out."

Ratings by category

Unsurprisingly, employers favour students from schools with the highest academic standards. But educational quality alone is not enough to ensure strong post-degree employment statistics. What sets the top rated schools apart is that they do not rely merely on their academic reputation to place students in jobs, but actively seek out the best employers and bring them to the school. Beyond academic quality, one reason that schools such as Chicago, Stanford and IESE have impressive careers statistics is the quality of their careers services.

Bringing together the top companies with the brightest students inevitably leads to some impressive salaries. European schools have recently had the upper hand when it comes to the salaries of their graduates. This is partly because their students tend to be older with more work experience. It can also be attributed to a buoyant employment market—particularly in the areas which pay MBAs the largest salaries, such as the UK's financial services sector. But even against such factors, many US schools have seen an increase in the salaries of their graduates. Five can now boast average salaries over US$100,000, with Stanford leading North America at US$112,000.

But despite this, students from European schools still attract the highest salaries. Only one school, Ashridge, has so far broken the US$200,000 barrier, but of the 26 whose students earn an average of US$100,000 or more, 19 are European.

European schools also do well in the networking stakes, often because their alumni tend to be more international. Henley, for example, has alumni associations in 27 countries; not bad for a school with a full time intake of under 20. Even relatively young European schools, such as Cambridge, already have an impressive reach across the world. In contrast, many US schools' alumni have yet to open up a single overseas branch.

What the US schools tend to be much better at, though, is keeping their alumni active once they have left the programme. In this they are helped by having graduated more MBAs each year for a longer time, meaning they have a bigger alumni base. But it is still an impressive achievement to keep so many involved. Wharton, for example has over 80,000 active MBA alumni; Kellogg has over 50,000.

The ranking’s distinctive features and methodology
Over the past 18 years, the Economist Intelligence Unit has regularly surveyed MBA students about why they take an MBA. Four factors consistently emerge:

• to open new career opportunities and/or further current career;

• personal development and educational experience;

• to increase salary;

• the potential to network.

These factors are the basis for the ranking. The Economist Intelligence Unit ranks full-time MBA programmes on their ability to deliver these elements to students. It weights each element according to the average importance given to it by students surveyed over the past five years.

The Economist Intelligence Unit ranking differs from other rankings in several important areas. It is:

• More student-centric. It measures the way schools meet the demands students have of an MBA programme.

• All-embracing. It is based on detailed questionnaires completed by business schools and around 20,000 current MBA students and graduates around the world. Key numerical data (such as average GMAT scores) are combined with subjective views from students and graduates (such as their assessment of a business school’s faculty).

• Global. It allows direct comparison of MBA programmes around the world.

• Regional. It compares MBA programmes in three regions: North America, Europe, and Asia and Australasia.

• Flexible. Programmes may be ranked in many ways, producing, for example, tables of the top ten US or Asian and Australasian schools by GMAT score or the top ten US and European school by percentage of foreign students. This facility is available at www.which-mba.com.

To qualify for inclusion in the Economist Intelligence Unit rankings, the schools with full-time MBA programmes that responded to our survey had to meet various thresholds of data provision, as well as attaining a minimum number of responses to a survey gauging the opinion of current students and alumni who graduated within the last three years. These were set as a proportion of the annual intake of students to the programme.

Data were collected during spring 2007 using two web-based questionnaires, one for business schools and one for students and recent graduates. Schools distributed the web address of the latter questionnaire to their own students and graduates. Around 20,000 students and graduates participated. All data received from schools were subject to verification checks, including, where possible, comparison with historical data, peer schools and other published sources. Student and graduate questionnaires were audited for multiple or false entries.

The rankings are based not just on data collected this year, but on a weighted average of the past three years. Data and survey responses for 2007 (50%), 2006 (30%) and 2005 (20%) are used in order to provide a rounded picture of the school than would be the case if data for just 2007 was used. Changes in educational provision or job placements are thus reflected gradually, much as the improvement would affect students

The table below summarises the measures used to calculate the rankings together with their respective weightings. Student and alumni ratings make up 20% of the total ranking and 80% is based on data provided by schools. The statistical methodology adopted for the ranking gives each business school a unique score (known to statisticians as a z-score). Unlike some other rankings, the Economist Intelligence Unit does not include any “equal” schools (for example, four schools ranked equal sixth followed by one ranked tenth). However, it should be noted that differences between some schools might be very slight.