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COMPARE Princeton or MIT for Master in Finance?

I'm a little surprised by how little consensus there is in this debate. Clearly, as in any of these discussions, there is room for preferences. You might take MIT if you assign a higher weighting to Sloan, Cambridge, MIT's math and engineering prowess, faculty members associated with the program (Merton), etc. But as alain is calling for, let's look at the reasons for why Princeton is the clear objective choice, some of which have been mentioned above:
-Higher selectivity (about 3x harder but there is surely a composition effect too). This leads to a stronger cohort.
-Higher mean & median starting salary.
-Higher placement rate at arguably more selective employers.
-More resources for each student. Princeton has the largest per capita endowment of any school in the world, so this makes sense.
-Lower tuition (depending on whether you are admitted into the 1 year or 2 year program)
-Colleagues with experience in the financial industry. Princeton has a great placement record partly because it takes students who have already worked at great places. MIT will take many students direct from undergrad with little work experience.
-More established program, started under Bernanke's tenure.
-More reputed and respected program on Wall Street and around the world (although this may change as MIT becomes established too).
-Close, intense, collaboration between students due to the smaller classes and smaller cohort size. Quality of alumni (i.e., strength of relationships) can be just as important as how many alumni there are.
-Sims just won the Nobel prize (with Kahneman, Krugman, Scheinkman, Shin, Blinder, and the wunderkinderen Brunnermeier, Xiong, and Hong, it's no wonder Princeton is at the forefront of financial economics).

Again, Princeton's MFin also has a more interdisciplinary mission statement, so if you don't value that too much, then that will feed into preferences. Overall, you may argue with some of the individual points, but together, I think they should paint a clear picture.
 
JayMesa I think there is consensus around the fact that Princeton is a significantly stronger program, but also around the fact that we're not comparing Princeton against UW Green Bay either. There is not such an overwhelming difference between MIT and Princeton that you should dump MIT before you figure out how much you like the campus, the culture, and the like.

Princeton has the stronger program but only a fool would say that you should go to MIT only if you get rejected from Princeton- or that MIT's best students can't compete with Princeton's best students. So visit both campuses first, figure out if there's an obvious decision to be made for MIT, and if there isn't, THAT'S when you choose Princeton.
 
So visit both campuses first, figure out if there's an obvious decision to be made for MIT, and if there isn't, THAT'S when you choose Princeton.
That's sensible advice. In fact, many US highschool students make college trips every year as part of their application process. That's doing due diligence.
That said, a lot (majority) of MFE applicants are oversea and rely on online information to make that $100K decision.
 
That's sensible advice. In fact, many US highschool students make college trips every year as part of their application process. That's doing due diligence.
That said, a lot (majority) of MFE applicants are oversea and rely on online information to make that $100K decision.

Exactly. So when looking at a large investment, making that trip and visiting the campus is due diligence. I wouldn't replace visiting the campus with online information no matter where you are in the world if you are going to spend a large amount of money.
 
Exactly. So when looking at a large investment, making that trip and visiting the campus is due diligence. I wouldn't replace visiting the campus with online information no matter where you are in the world if you are going to spend a large amount of money.

especially when the online information is mostly chatter from ignoramuses ;)
 
Andy/Golllini,
What are the things to look at while going to a campus? I think you are not talking about infrastructure and for faculty, not sure, if faculty will have time to meet prospective students. Nonetheless, we can get the faculty info. on university website also. The only thing I can think off is attending actual classes (of at least famous faculty e.g. Merton for MIT). That might give some idea.
 
Andy/Golllini,
What are the things to look at while going to a campus? I think you are not talking about infrastructure and for faculty, not sure, if faculty will have time to meet prospective students. Nonetheless, we can get the faculty info. on university website also. The only thing I can think off is attending actual classes (of at least famous faculty e.g. Merton for MIT). That might give some idea.
Largely the students and the faculty.

There are some things you will spot right away. When I went to visit Princeton, I was surprised to discover Ann Taylor, Ralph Lauren, and other stores that undergraduates shopped in. This was a bit of a departure from Illinois where most of us were dirt poor and bought all of our clothing from Wal-Mart (Meijer if we had a little more money, Kohls if we were middle-class and had very nice moms). I remembered getting a $4 sub at Subway and my friends thought I was living the high life.

Go on a Saturday, find where the popular coffee house is, and try to strike up a conversation with the college-age looking kids. In Princeton, what was very frustrating was that many students went to other colleges in town. You have to be couthe and try not to ask too many leading questions, but you also have to efficiently figure out which students go to Princeton. Most of them were very friendly and happy to share their experiences.
 
Why is the more selective program better?

Let's build a toy model:
"goodness" for person A = "market goodness" + "individual-specific goodness"

The idea is simple, ask 1000 applicants to give 0-100 score for the 2 prorams. Run a regression of scores against 10+ common factors (placement rate, location, starting pay, etc), estimate all coefficients. Use the regression equation to predict any person's score. On the Right Hand side, the error term is "individual-specific goodness", the rest is "market goodness".

The error term is supposed to be big, but I bet the R-square is still big enough to confirm the factors as "effective predictors". It is evidence that our evaluations share a significant overlap. Our opinions are not THAT different from each other. Those who insist on the "fit" factor are apparently turning the whole school-choice question into a subjective exercise without any objective bench. It is wrong.

"Market goodness": I guess 8 out of 10 applicants (defined as "average person" ) with both offers will chose Princeton over MIT. Thus Princeton is able to enrol students of higher average caliber -- so called "selectivity". I just think selectivity in applicant pool is the best proxy for measuring "market goodness".

"Individual-specific goodness": what you call "fit". Enough said about this. It is no doubt subjective.

911 Turbo is a better car than Toyota Prius in the "market goodness" sense, the price tags tell it all. Of course, a tree hugger can prefer Prius.


I'd like to synthesize a bit, by just looking at the simple equation:
"Unless one has very strong personal preference for distinct features of the MIT curriculum or environment, Princeton is strongly recommended over MIT."


P.S. I am rejected by Princeton and admitted into MIT. I think MIT fits my personal condition a bit better, but given other "general" considerations like placement, prestige, etc, I still prefer Princeton, if given a choice.
 
I guess 8 out of 10 applicants (defined as "average person" ) with both offers will chose Princeton over MIT.

I tend to differ on this....My guess would be around 9.5
 
I guess 8 out of 10 applicants (defined as "average person" ) with both offers will chose Princeton over MIT.

I tend to differ on this....My guess would be around 9.5
A better way to check this is to look at the Tracker, filter by Princeton, Admit, and look at how many people have select Yes in the Will Join column.
Last check, it was 9/13.

Historically, their yield rate is about 80% so there are always 20% of admitted who go elsewhere.
https://www.quantnet.com/forum/threads/acceptance-rates-for-mfe-programs.1302/page-4#post-57422
 
The idea is simple, ask 1000 applicants to give 0-100 score for the 2 prorams.

I think you are basing your analysis on the wrong premises. Who gives a rat's ass what an applicant says? their opinion is not valuable because they have zero input in what your placement, your salary or your future is going to be. You will need to ask the people doing the hiring and, from my experience (since I do hiring too), there are usually 2 things that matter in this field: what you know and how well you interact with the group. The school you came from is not as important.
 
Let's build a toy model:
"goodness" for person A = "market goodness" + "individual-specific goodness"

The idea is simple, ask 1000 applicants to give 0-100 score for the 2 prorams. Run a regression of scores against 10+ common factors (placement rate, location, starting pay, etc), estimate all coefficients. Use the regression equation to predict any person's score. On the Right Hand side, the error term is "individual-specific goodness", the rest is "market goodness".

The error term is supposed to be big, but I bet the R-square is still big enough to confirm the factors as "effective predictors". It is evidence that our evaluations share a significant overlap. Our opinions are not THAT different from each other. Those who insist on the "fit" factor are apparently turning the whole school-choice question into a subjective exercise without any objective bench. It is wrong.

"Market goodness": I guess 8 out of 10 applicants (defined as "average person" ) with both offers will chose Princeton over MIT. Thus Princeton is able to enrol students of higher average caliber -- so called "selectivity". I just think selectivity in applicant pool is the best proxy for measuring "market goodness".

"Individual-specific goodness": what you call "fit". Enough said about this. It is no doubt subjective.

911 Turbo is a better car than Toyota Prius in the "market goodness" sense, the price tags tell it all. Of course, a tree hugger can prefer Prius.


I'd like to synthesize a bit, by just looking at the simple equation:
"Unless one has very strong personal preference for distinct features of the MIT curriculum or environment, Princeton is strongly recommended over MIT."


P.S. I am rejected by Princeton and admitted into MIT. I think MIT fits my personal condition a bit better, but given other "general" considerations like placement, prestige, etc, I still prefer Princeton, if given a choice.



You cannot regress those kind of statistics. This whole analysis is wrong mathematically + its an extreme hypothetical. CharlesC, try a different approach.
 
I think you are basing your analysis on the wrong premises. Who gives a rat's ass what an applicant says? their opinion is not valuable because they have zero input in what your placement, your salary or your future is going to be. You will need to ask the people doing the hiring and, from my experience (since I do hiring too), there are usually 2 things that matter in this field: what you know and how well you interact with the group. The school you came from is not as important.


Their opinions are of course not input (value-drivers), but they do reflect the value. Their opinions are very valuable in this sense. Are you saying that an average applicant does NOT rationally process info and evaluates programs based on relevent factors?

If so, you do not hold respect for the "average opinion" and I challenge you to beat S&P index for 4 quarters straight.

If not, you should definitely care about what an "average person's preference" looks like. The chances are, you opinion should NOT be that far away from the "average opinon" unless your personal circumstances are very unique (e.g. your family live in Boston near MIT). When you disagree with the "herd" and I have no private info regarding your intellectal superiority, I choose to side with the herd.

To be a contrarian is fashionable. To believe in one's "unique perspective" is tempting. Arguing for non-mainstream positions displays critical thinking and moral courage. I have also suffered from all these in my adolescence.
 
You cannot regress those kind of statistics. This whole analysis is wrong mathematically + its an extreme hypothetical. CharlesC, try a different approach.

LHS: subjective choice
RHS: determinats

Given each applicant gives preference scores to only 2 programs (presumably based on shared factual factors + individual perference), confidece level may be low. Use 10000 applicants then. Implementation may be hard, but I was just raising an idea, a concpet. It is not "mathematically" wrong.


Neither is it extreme. A perspective of "shared/systemic" plus "individual-specific" is also how we look at risk.
 
A better way to check this is to look at the Tracker, filter by Princeton, Admit, and look at how many people have select Yes in the Will Join column.
Last check, it was 9/13.

Historically, their yield rate is about 80% so there are always 20% of admitted who go elsewhere.
https://www.quantnet.com/forum/threads/acceptance-rates-for-mfe-programs.1302/page-4#post-57422

Right, thank you Andy. The other 20% may choose to attend MIT (if they can) or go elsewhere. 8/10 in my example is a conservative estimate -- just on the lower bound.
 
Their opinions are of course not input (value-drivers), but they do reflect the value. Their opinions are very valuable in this sense. Are you saying that an average applicant does NOT rationally process info and evaluates programs based on relevent factors?

If so, you do not hold respect for the "average opinion" and I challenge you to beat S&P index for 4 quarters straight.

If not, you should definitely care about what an "average person's preference" looks like. The chances are, you opinion should NOT be that far away from the "average opinon" unless your personal circumstances are very unique (e.g. your family live in Boston near MIT). When you disagree with the "herd" and I have no private info regarding your intellectal superiority, I choose to side with the herd.

To be a contrarian is fashionable. To believe in one's "unique perspective" is tempting. Arguing for non-mainstream positions displays critical thinking and moral courage. I have also suffered from all these in my adolescence.

I'm not against the herd, I'm against the WRONG herd. I'm against the average opinion of the applicants, not the average opinion of the people doing the hiring. Those are very different crowds.

BTW, if QN is any indication, the average applicant doesn't think too rationally when it comes to their own future. They value an ideal more than reality. There is plenty of history on this site. Take a look at the past threads. The common theme is the idealism of future students. There is nothing wrong to be an idealist but they tend to be disconnected from reality.

This field is very small and people tend to know each other and speak to each other in a lot of circumstances and ocassions. I've seen how the average person doing the hiring in this field thinks and I have spoken with a lot of them. In general, there is a tendency to agree with what I said.

I'm older than most of the people that comes to this forum so I speak from my own experience.
 
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