For Allison Kaye, the decision to study at Spain’s Esade Business School was all about international experience. The 32-year-old American previously lived in New York and worked in a small travel company, escorting high school children on overseas trips. “I had spent time introducing other students to the value of international travel and I wanted to experience it myself,” she says. “I wanted to make my career international.”

It is a sentiment that has been increasingly common among MBA students over the past decade. Schools such as London Business School, Insead near ­Paris, and Saïd in ­Oxford have ­regularly reported that US students are the largest nationality group on their MBA programmes. At Esade, Americans are second only to Spaniards on the MBA.

Diversity of students and a globally focused curriculum are two of the main reasons for non-Europeans to study in Europe. But as the euro crisis continues and European governments prove ­increasingly reluctant to give post-­degree job visas to non-Europeans, there are real concerns that these advantages will be lost.

The rise of Chinese and Indian ­business schools is compounding the problem for European schools as US MBA students apply there instead.

Dipak Jain, newly-appointed dean of Insead and formerly dean of the ­Kellogg school at Northwestern University near Chicago, believes there will be no short-term impact. “There is still a very large part of the Asian world that wants a western programme. That is not going to go away in the next 20 years or so,” he says.

But Julio Urgel, a director at the European Foundation for Management Development, is more circumspect. “For some Chinese and Indian ­students, Europe will continue to be attractive. Very often Asian students feel more comfortable in a European school than in the US because we live with diversity more easily. But some Americans, Australians and Latin Americans will look elsewhere.”

Moreover, the past three years has seen a sea change in the relative ­powers of European and Asian ­business schools. A decade ago, European schools scurried to set up programmes in China; now Chinese universities are setting up campuses overseas. The most high-profile private Chinese ­business school, Cheung Kong, has recently set up in London, for example, bringing increased competition for European schools on their home turf.

As uncertainty about the future of the European economy drags on, Prof Urgel believes that both corporate ­education and postgraduate degree programmes in Europe will be hit.

“People are becoming more and more cautious and business schools are beginning to feel that. Because we are ­unsure how long this will last, people will be more cautious with their ­savings,” he said.

European business schools will have to use some of the tactics they teach in the classroom in order to survive, ­including increasing marketing overseas. “Once Europe becomes less relevant to Asia we will have to redouble our ­efforts to persuade candidates that Europe is still a valuable place to study,” says Alfons Sauquet, dean of Esade. For Spanish schools, the Latin-American connection will be a bonus, he believes.

There may yet be a bigger problem for European business schools: money. For Prof Jain, endowments, or lack of them, are one of the biggest differences between US and European business schools.

“The question is, how do you create shock absorbers or cushions? As ­another dean said to me, ‘We eat what we kill’. In ­Europe you can’t rely on alumni giving.”

The money is needed to fund top-level research, and Prof Jain believes promoting the degree programmes is a way to increase funding. “The question is, how do we balance the business model with the academic model?”

Prof Jain is one of two top academics to take the helm at a European business school this year, but his views are markedly different from Peter Tufano, who left Harvard to become dean of the Saïd Business School at Oxford. Prof ­Tufano believes there is no real gulf between US and European business schools. “I see a lot more similarities than differences. We’re talking in ­business and business schools about the same issues on both sides of the pond.” These include the eurozone crisis and the rise of China, he says.

Even on the big issues that used to divide the teaching between schools on the two continents, such as the supremacy of shareholder value, views are converging, says Prof Tufano.

“I think everyone has adopted a more ­nuanced view than when I did an MBA …There are times I can close my eyes and I don’t really feel I am in a different place.”

Iese's new building
Iese's new building in Barcelona

One of the biggest issues facing MBA programmes in both the US and Europe will be their ability – or inability – to find jobs for graduating ­students. Of all the issues resulting from the financial crisis, this is the one that will have the biggest effect, according to Jordi Canals, dean of Iese Business School in Spain. “We’ll see ­investment banks taking fewer students, and international companies recruiting fewer students in Europe.”

Iese reports that one of the few parts of the world that is still thirsty for MBA graduates is Brazil – but not all European graduates want to work there.

Kaye at Esade, for example, intends to return to New York, which will bring its own issues. Had she studied in New York, she says, “I would have had the benefit of being able to network with people who I would work with.”

This has not put her off studying in Europe, though.

“It doesn’t matter what you do in life, you will always benefit from an ­experience like this, sitting in a classroom and listening to the views of ­people from all around the world.

I don’t think you can beat it.”

Get alerts on INSEAD when a new story is published

Copyright The Financial Times Limited 2021. All rights reserved.
Reuse this content (opens in new window)

Follow the topics in this article