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Skill-Biased Management: Evidence from Manufacturing Firms

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  • Andy Feng
  • Anna Valero

Abstract

This article investigates the link between management practices and workforce skills in manufacturing firms, exploiting geographical variation in the supply of human capital. Skills measures are constructed using newly compiled data on universities and regional labour markets across 19 countries. Consistent with management practices being complementary with skills, we show that firms further away from universities employ fewer skilled workers and are worse managed, even after controlling for a rich set of observables and fixed effects. Analysis using regional skill premia suggests that variation in the price of skill drives these relationships.

Suggested Citation

  • Andy Feng & Anna Valero, 2020. "Skill-Biased Management: Evidence from Manufacturing Firms," The Economic Journal, Royal Economic Society, vol. 130(628), pages 1057-1080.
    • Handle: RePEc:oup:econjl:v:130:y:2020:i:628:p:1057-1080.
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    Cited by:

    1. Anna Valero, 2021. "Education and management practices," Oxford Review of Economic Policy, Oxford University Press and Oxford Review of Economic Policy Limited, vol. 37(2), pages 302-322.
    2. Valero, Anna & Van Reenen, John, 2019. "The economic impact of universities: Evidence from across the globe," Economics of Education Review, Elsevier, vol. 68(C), pages 53-67.
    3. Nicholas Bloom & Renata Lemos & Raffaella Sadun & John Van Reenen, 2020. "Healthy Business? Managerial Education and Management in Health Care," The Review of Economics and Statistics, MIT Press, vol. 102(3), pages 506-517, July.
    4. John T. Addison & Paulino Teixeira & Lutz Bellmann, 2020. "Management Practices and Establishment Performance under Non-Union Workplace Representation," CESifo Working Paper Series 8599, CESifo.
    5. John T. Addison & Paulino Teixeira & Lutz Bellmann, 2023. "Performance and the Conjunction of Better Management Practices and Non-Union Workplace Representation," Journal of Labor Research, Springer, vol. 44(1), pages 1-43, June.
    6. Daniela Scur & Raffaella Sadun & John Van Reenen & Renata Lemos & Nicholas Bloom, 2021. "The World Management Survey at 18: lessons and the way forward," Oxford Review of Economic Policy, Oxford University Press, vol. 37(2), pages 231-258.
    7. Anna Valero, 2021. "Education and management practices," POID Working Papers 007, Centre for Economic Performance, LSE.
    8. Lucia Errico & Andrea Mosca & Sandro Rondinella, 2023. "University-Court Proximity: What are the effects on the legal system performance?," Regional Economy, , vol. 7(Q1), pages 21-33.
    9. Anna Valero, 2021. "Education and economic growth," CEP Discussion Papers dp1764, Centre for Economic Performance, LSE.
    10. Sivropoulos-Valero, Anna Alexandra, 2021. "Education and economic growth," LSE Research Online Documents on Economics 114434, London School of Economics and Political Science, LSE Library.
    11. P. Michael KOSICEK & Ramesh SONI & David YERGER, 2023. "The Distribution of Relative Demand and Relative Supply Shocks for Managers Across the U.S. Economy," Economics and Applied Informatics, "Dunarea de Jos" University of Galati, Faculty of Economics and Business Administration, issue 2, pages 5-13.
    12. Florio, Erminia & Manfredonia, Stefano, 2021. "Ancestors, inter-generational transmission of attitudes, and corporate performance: Evidence from the Italian Mass Migration," GLO Discussion Paper Series 830, Global Labor Organization (GLO).
    13. Anna Valero, 2021. "Education and economic growth," POID Working Papers 006, Centre for Economic Performance, LSE.
    14. Sivropoulos-Valero, Anna Valero, 2021. "Education and management practices," LSE Research Online Documents on Economics 114436, London School of Economics and Political Science, LSE Library.
    15. Nazia Bibi & Zeeshan Anwar & Tauseef Rana, 2021. "Expertise based skills management system to support resource allocation," PLOS ONE, Public Library of Science, vol. 16(8), pages 1-20, August.
    16. Catherine Robinson & Christian Siegel & Sisi Liao, 2021. "Technology Adoption and Skills A Pilot Study of Kent SMEs," Studies in Economics 2114, School of Economics, University of Kent.

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    More about this item

    JEL classification:

    • I23 - Health, Education, and Welfare - - Education - - - Higher Education; Research Institutions
    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
    • L20 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - General
    • L60 - Industrial Organization - - Industry Studies: Manufacturing - - - General
    • M20 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Economics - - - General

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