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Wharton may be facing stiffer competition from its European counterparts for quality MBA candidates.

European business schools - offering a shorter and cheaper MBA program - are becoming an increasingly popular option for students seeking a higher business degree.

Wharton's partner school INSEAD, a French business school with campuses in both Fontainebleau and Singapore, has seen an increase in the number of applicants, said Wharton professor John Kimberly, who is the executive director of the Wharton/INSEAD alliance.

"The opportunity costs are much lower," he added.

Students not only save a whole year's worth of tuition and time - the masters program is typically only one year in Europe as opposed to two in the US - but also forego a year less of salary.

Monetary benefits also come from the lower overall cost of MBA programs.

At ESADE Business School, which has campuses in Barcelona, Madrid and Buenos Aires, the one year MBA program costs 42,500 euros, which is equivalent to around $67,000. In comparison, the cost for a Wharton MBA, including tuition, fees, and living expenses, for first-year students was $71,948 for the academic year 2007 to 2008.

And taking into consideration the fact that the Wharton MBA is a two-year long program, the costs are significantly higher.

The diverse student body is another attraction of European institutions. For example, 70 percent of the students in the 18-month MBA program at the ESADE Business School are from overseas, compared to 39 percent in Wharton's MBA population.

Kimberly said that although the one-year program may be a bit more intense than the two-year one, students who have chosen to participate in the shorter program typically cope well with any additional pressure.

But despite the cost and diversity advantages, some say the prestige of American schools give them an edge.

"Recruiters still believe that European schools are lower in quality," in terms of academics compared to American business schools, first-year MBA candidate Naoko Miake said.

In addition, for students who are looking to work in the United States, schools like Wharton may be the smarter choice.

U.S. business schools that have a strong focus on American business practices as well as a strong track record on U.S.-oriented career placements are more likely to give candidates an edge when looking for jobs upon graduation.

American business school may offer the more relevant curriculum "for students who don't necessarily have global ambitions," Kimberly said.

Wharton sophomore Soo Jin Koh, who is considering pursuing an MBA, said she would choose an American business school because the education would be more applicable to a U.S. job market.

The name value of a school like Wharton or Harvard Business School - which most European schools still lack - is another important aspect for her.

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