An MBA (Master of Business Administration) and a Ph.D (Doctor of Philosophy) are both types of postgraduate degrees. Receiving an MBA signifies that a student has achieved mastery of a specific area of business, from accounting to economics to marketing (see Reference 1). MBA programs typically prioritize concepts and skills useful in the corporate world. Ph.D programs cover many of the same ideas, but place emphasis on academics, such as the study and theory of business (see Reference 2, page 1).
Both degrees require a commitment of time and money, though MBA programs are often more flexible. Full-time MBA programs run one to two years, depending on whether a student's prior business experience can be counted towards some of the required 30-60 credits (see Reference 3). Students who are unable to attend school full-time, however, may qualify for a part-time MBA program in which classes are divided over multiple years. Part-time programs can help spread out the cost of tuition as well, and some employers are willing to share the expenses of an MBA degree with a valued employee. Academic institutions tend to be stricter with Ph.D programs. Many departments expect a full-time commitment, including on-campus residency, interaction with faculty and students and participation in internships. On average, Ph.D programs take four to six years to complete (see Reference 2, page 1).
Typically a Ph.D is thought to be a better move for someone planning to enter the academic world --- say, as a university professor --- while an MBA is the best choice for a person who will be working in the private sector (see Reference 2, page 1). However, there are always exceptions to the rule. For example, a Ph.D degree can be helpful for someone interested in becoming a business consultant or taking a research position in government or business. While most universities prefer to hire professors with Ph.Ds, an MBA is often suitable for teaching at a community college or online university.
MBA and Ph.D degrees are both costly endeavors. The average tuition for one year of an MBA program is $40,000, though that number will increase or decrease depending on the prestige of the school (see Reference 6). Ph.D programs require similar tuition, but much of the amount may be waived or offset with a stipend in exchange for research and teaching services. Despite the expense, both degrees have the potential to pay off in the long run. According to a 2008 Graduate Management Admission Council survey, MBA students reported receiving job offers worth 73.6 percent more than those received before entering the program (see Reference 5). For a potential professor, a Ph.D provides the opportunity for a career as a tenured member of a university faculty.