Full Citation

Title: What Drives Differences in Management Practices?

Citation Type: Miscellaneous

Publication Year: 2018

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Abstract: Partnering with the US Census Bureau, we implement a new survey of “structured” management practices in two waves of about 35,000 manufacturing plants each in 2010 and 2015. We find enormous dispersion of management practices across plants, with 40% of this variation across plants within the same firm. This variation in management practices accounts for about a fifth of the spread of productivity, a similar fraction as that accounted for by R&D, and larger than the fraction explained by ICT and human capital. Management practices are more predictive of long-term survival than productivity. We find causal evidence that two drivers are very important in improving management. Regulation of the business environment (as measured by the Right-toWork laws) boosts management practices associated with incentives. Learning spillovers as measured by the arrival of large new entrants in the county (“Million Dollar Plants”) increases the management scores of incumbents.

Url: http://www.tau.ac.il/~itaysap/Drivers_2018april.pdf

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Authors: Bloom, Nicholas; Brynjolfsson, Eric; Foster, Lucia; Jarmin, Ron; Patnaik, Megha; Saporta-Eksten, Itay; Reenen, John Van

Publisher: National Bureau of Economic Research

Data Collections: IPUMS CPS

Topics: Labor Force and Occupational Structure, Natural Resource Management, Other

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