The most cost effective college in America? Not Harvard…

Money Magazine has released its list of the best colleges, and yes, the Ivies and little Ivies are there, but not at the very top. The top-ranked school grants just one degree, and it’s safe to say that most Princeton Review devotees haven’t heard of the runner-up.

Massachusetts’ Babson College, a business school, gets top billing. All students graduate with a bachelor’s of science in business, but as Money points out, their students take a hefty load of humanities and science courses, too.

But students at the number-two ranked school all graduate with the same degree, too; Webb Institute, in Glen Cove, New York, offers one double major to its 80 undergraduates: naval architecture and marine engineering.

Remember, this is Money Magazine, so “best,” in this case, means “the most bang for your tuition buck.” Many of the top 50 schools are institutions known for some professional or disciplinary specialty: from the Massachusetts Institute of Technology (number 3), to Harvey Mudd (7), Cooper Union (8), California Institute of Technology (10) and the Maine Maritime Academy (12), which is number one on Money’s list of the 25 best public colleges.

Whether business or engineering is your passion, it’s not so surprising that attending an institution that specializes in a specific field often delivers a strong return.

In the case of Webb, for example, it only attracts students who are really interested in pursuing naval architecture on Long Island Sound. And for those teens — mostly male — who feel that calling and matriculate, Webb picks up the tab: tuition is free.

It doesn’t hurt that some of these professions are relatively lucrative. As Money writes about Babson, “the focus on business is the big draw — and provides a big payoff.” Six years after graduating, Babson alumni report earning an average of $60,000 — $13,000 more than the average for graduates of comparable schools (although Money does adjust earnings to account for the academic major composition and academic and economic profile of the schools).

Starting with a pool of 1,500 four-year colleges and universities, Money filtered out those colleges and universities with below average six-year graduation rates, those with shaky finances and military academies that require a promise of service in exchange for free tuition. That left just 665 institutions.

They then assessed the schools in three equally weighted categories. (View their complete methodology.) The first, quality of education, includes information like the six-year graduation rate and what’s known as yield, or the percentage of students admitted who enroll, as well as the test scores of entering freshmen. Qualitative measures of instruction come from the student-faculty ratio and a college’s average score on Those subjective ratings, however, depend on how many and which kinds of students feel compelled to rate their teachers on the Internet.

Affordability, the second category, measures the net cost of a degree (that’s tuition per year times the average number of years it takes to graduate), which factors in the school’s average financial aid based on need, merit and athletics. (To understand the importance of looking at net prices — that is, what students pay after financial aid — read this David Leonhardt Upshot column in Tuesday’s New York Times.) This category also includes student and parental debt and loan defaults.

Their final category — “outcomes” — delves into the nitty gritty of who’s earning what. They look at the early and mid-career earnings alumni report to, although the accuracy of that information is contingent on alums actually reporting. The Payscale data also excludes alums who have continued their education beyond a bachelor’s degree, which, for many liberal arts schools, is a significant portion of their alumni, particularly the higher-earners. Money Magazine also investigates earnings by major and value-added earnings, which are adjusted for the economic and academic profile of the student body in order to give higher ranks to schools whose alumni made more money than would have been expected, given what they studied and where they came from.

And so, after all this, Babson College came out on top. Fitting, perhaps, in that the school was founded by the legendary investor Roger Babson in 1919 with a curriculum that combined, in the words of Wikipedia, “both class work and business training: businessmen made up the majority of the faculty instead of academics, and the institute’s curriculum focused more on practical experience.”

Two of Babson’s fabled “Ten Commandments of Investing” seem appropriate to his school’s ranking: “Don’t buy without proper facts” and “Don’t be fooled by a name.”