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Objective
To analyse the patterns of the Gravity Model of Trade and assess its application on the B-school
Selection decision in the context of India.
Motivation
The aspect which specifies the bent towards adoption of this topic is the need to know if the factors
like ROI, profile score and the distance from hometown are the determinant factors for the choice of a
business school.
The Proposition
The proposition of the paper is to analyse the relevance of the Gravity theory of Selection in the
present B-Schools in India. The Gravity theory of Selection is defined with the following equation
,
where Fij represents Chances of student i taking B-School j
G is a constant
Mi is the Profile score of student i
Mj is the Return of Investment of B-School j
Dij is the distance between student city and city of B-School i and j
Taking logs on both sides gives us a linear log function for statistical analysis.
Hypotheses
Null Hypothesis: Stream of under graduation has un significant impact on selection of B-School.
Hypothesis 2: There is a Positive effect of Return of Investment of B-School in selection.
1 For examples see McCallum (1995), Helliwell (1996), and Boisso and Ferrantino
(1997).
Proposed Methodology
The methodology involves the log-linear function. A null hypothesis testing for a set of B-schools a
particular student can interested in. It also consider chances by considering profile score of student.
A coefficients in the log-linear function would be tested for a significance level of 5% and results
would be tabulated.
1 For examples see McCallum (1995), Helliwell (1996), and Boisso and Ferrantino
(1997).