Markets for Everything: Bumping MIT Students
Normally, schools offer scholarships to entice students to enroll. This year, the Massachusetts Institute of Technology’s business school handed them money to go away.
The Sloan School of Management’s full-time M.B.A. program, usually about 400 students, was oversubscribed by an unusually high number of students this year. Rather than expand the class size, the school asked for volunteers willing to wait a year to enroll, sending out an e-mail just a couple of weeks before the Aug. 23 kickoff barbecue. By that point, many expectant students had quit jobs and secured housing in the Boston area.
So what did MIT’s Sloan School do?
After realizing they had a student surplus, school officials emailed the incoming class on Aug. 7, offering “guaranteed admission to the class of 2015 for the first 20 admitted students who request it.” The school gave them until Aug. 13 to respond, according to one student’s copy of the letter, which was reviewed by The Wall Street Journal. But it didn’t get enough takers.
So, like an airline offering vouchers to travelers willing to hop off oversold flights, the school put money on the table, offering students who expressed an interest a $15,000 scholarship to be applied to next year’s tuition. Students still balked, and on Aug. 21, a day after pre-term refresher courses began, Sloan raised the offer to $20,000 for the first 10 respondents. (Tuition for the 2012-2013 academic year is $58,200, with total expenses–including books, housing and food–estimated at just under $89,000.)
Four incoming Sloan students volunteered, said Mr. Garcia, and the school started the year with an M.B.A. class of 413, up from 404 last year. The $80,000 in funds will come out of next year’s fellowship pool. He added that the school expects some deferring students won’t end up enrolling next fall. (If they don’t enroll, they won’t get money from MIT.)
This is from Melissa Korn, “Bad Math: MIT Miscounts Its Newest B-School Class,” Wall Street Journal, September 26, 2012.