Why are business schools so expensive?

An MBA is considered among the most prestigious qualifications, but it’s also expensive. In South Africa, this degree will set you back between R150 000 and R500 000 — and that’s just the tuition costs! Factor in accommodation, living costs, extracurricular activities, international class trips and the expense of taking time out of the workforce to pursue a full-time qualification, and the final cost is far steeper than it may first appear.

So — why does the MBA cost so much?

Expert faculty

When it comes to the expertise on offer during the MBA training, it becomes clear that you get what you pay for. Leading business schools invest in expert faculty, and this is perhaps the single biggest contributor to the high cost of an executive management education. The educators who lead top programmes are often considered “pracademics” who have extensive industry experience to back up their strong academic credentials.

Institutional resources

Most MBA programmes provide students with on-campus resources such as technology hubs and innovation labs. The physical space for lectures, tutorials and group work can also be expensive, especially considering that many business schools aim to position themselves in upmarket areas or business hubs, where real estate does not come cheap.

Extra activities

The MBA experience extends far beyond the reach of the classroom. Some tuition fees include the cost of international business trips, real-world consulting projects, networking events, career fairs, workshops and coaching, while other educational institutions come in at a much lower initial cost on tuition, but bill separately for the extra-curricular activities and out-of-classroom experiences.