Per FT

A recent study by NBER showed that CEOs with MBAs were more likely to decrease wages and revenue share towards labor. No evidence was found of how it improved the company's sales or productivity.

"We found no evidence that CEOs with such degrees increase sales, productivity, investment or exports relative to the levels the company achieved before."

The study found that businesses where CEOs held business degrees showed a 6% drop in wages compared to how they would've been otherwise after a five-year period. Reducing wage growth also showed no evidence of creating better earnings retention for other investments.

The report also points out that the actions of CEOs with MBA degrees could potentially damage long-term profitability by ignoring broader stakeholders. An example of this is the companies potentially losing higher-skilled workers.

Higher-skilled workers were reportedly more likely to leave the company when relative wages declined. However, when a CEO with an MBA degree gets appointed, the report says there is a short-term price increase along with higher share repurchases and dividends in both the US and Denmark.

On the contrary, it was found that employees from companies run by CEOs without degrees got an increased share of profits. The study took into account CEOs who graduated before 2000, with the report by FT saying business schools might have evolved as of late.

A recent report shared how Americans with college degrees saw the most wages decline in the last two decades at a 7.4% decline. The median annual pay for an American with a bachelor's degree in 2022 was $52,000.

In August of 2022, Biden decided to forgive student debt of up to $10,000 for borrowers earning less than $125,000 annually. This decision could cost average US taxpayers over $2,000.

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Financial Times

National Bureau of Economic Research's research