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Does competition raise productivity through improving management quality?

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  • Van Reenen, John

Abstract

A classic question in industrial organization is whether competition raises productivity and if so, through what mechanism? I discuss recent empirical evidence from both large-scale databases and specific industries which suggests that tougher competition does indeed raise productivity and one of the main mechanisms is through improving management practices. To establish this, I report on new research seeking to quantify management. I relate this to theoretical perspectives on the economics of competition and management, arguing that management should be seen at least in part as a transferable technology. A range of recent econometric studies suggests that (i) competition increases management quality and (ii) improved management quality boosts productivity.

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Bibliographic Info

Article provided by Elsevier in its journal International Journal of Industrial Organization.

Volume (Year): 29 (2011)
Issue (Month): 3 (May)
Pages: 306-316

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Handle: RePEc:eee:indorg:v:29:y:2011:i:3:p:306-316

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Web page: http://www.elsevier.com/locate/inca/505551

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Keywords: Management Productivity Organization;

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Citations

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Cited by:
  1. Nicholas Bloom & Renata Lemos & Raffaella Sadun & Daniela Scur & John Van Reenen, 2014. "The New Empirical Economics of Management," Discussion Papers 13-031, Stanford Institute for Economic Policy Research.
  2. Antonelli Cristiano & Fassio Claudio, 2012. "Academic knowledge and economic growth: are scientific fields all alike," Department of Economics and Statistics Cognetti de Martiis LEI & BRICK - Laboratory of Economics of Innovation "Franco Momigliano", Bureau of Research in Innovation, Complexity and Knowledge, Collegio 201203, University of Turin.
  3. Beerkens, Maarja, 2013. "Facts and fads in academic research management: The effect of management practices on research productivity in Australia," Research Policy, Elsevier, vol. 42(9), pages 1679-1693.
  4. Werner Hölzl, 2012. "Mobility Barriers and the Speed of Market Selection," WIFO Working Papers 437, WIFO.

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