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Managerial Quality and Productivity Dynamics

Author

Listed:
  • Achyuta Adhvaryu
  • Anant Nyshadham
  • Jorge Tamayo

Abstract

Do productivity and managerial quality vary within the firm? If so which managerial traits and practices matter most for team productivity? Combining granular garment production data with survey data on managers across 120 production lines in India, we document substantial productivity dispersion both across teams producing overlapping products and within team over the course of production runs, and structurally link this variation to a comprehensive assessment of supervisor quality. We find that factors related to managerial attention and control are the most important for enabling line productivity, both more impactful than traditionally emphasized dimensions like cognitive skills and tenure. We document that one mechanism by which specific managerial practices contribute to productivity is by way of enabling faster learning-by-doing. In-sample pay patterns suggest potential net gains from screening for or training in less readily measured dimensions of managerial quality, as pass-through of productivity contributions to pay is incomplete.

Suggested Citation

  • Achyuta Adhvaryu & Anant Nyshadham & Jorge Tamayo, 2023. "Managerial Quality and Productivity Dynamics," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 90(4), pages 1569-1607.
    • Handle: RePEc:oup:restud:v:90:y:2023:i:4:p:1569-1607.
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    File URL: http://hdl.handle.net/10.1093/restud/rdac062
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    Cited by:

    1. Bassi, Vittorio & Nyshadham, Anant & Tamayo, Jorge & Adhvaryu, Achyuta, 2020. "No Line Left Behind: Assortative Matching Inside the Firm," CEPR Discussion Papers 14554, C.E.P.R. Discussion Papers.
    2. Antonia Antweiler & Joachim Freyberger, 2025. "Flexible estimation of skill formation models," Papers 2507.18995, arXiv.org.
    3. repec:spo:wpecon:info:hdl:2441/7fsnj6af7v9ncrf76qn5p5on9e is not listed on IDEAS
    4. Zhou, Alex & Mahadeshwar, Ruchi, 2024. "The Impact of Intra-Household Income Hiding on Labor Productivity," The Warwick Economics Research Paper Series (TWERPS) 1525, University of Warwick, Department of Economics.
    5. Roth, Christopher & Hager, Anselm & , & Stegmann, Andreas, 2021. "Voice and Political Engagement: Evidence From a Natural Field Experiment," CEPR Discussion Papers 16839, C.E.P.R. Discussion Papers.
    6. Grabe, Leonhard & Sliwka, Dirk, 2025. "Managing Skills in Organizations - Evidence from a Field Experiment," IZA Discussion Papers 17727, IZA Network @ LISER.
    7. Seyed Mohsen Mirbagheri & Ata Ollah Rafiei Atani & Mohammadreza Parsanejad, 2023. "The Effect of Collective Decision-Making on Productivity: A Structural Equation Modeling," SAGE Open, , vol. 13(4), pages 21582440231, December.
    8. Andrew Caplin & David J. Deming & Søren Leth-Petersen & Ben Weidmann, 2023. "Economic Decision-Making Skill Predicts Income in Two Countries," NBER Working Papers 31674, National Bureau of Economic Research, Inc.
    9. Martin Beraja & David Y Yang & Noam Yuchtman, 2023. "Data-intensive Innovation and the State: Evidence from AI Firms in China," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 90(4), pages 1701-1723.
    10. repec:spo:wpmain:info:hdl:2441/7fsnj6af7v9ncrf76qn5p5on9e is not listed on IDEAS
    11. Emma Duchini & Victor Lavy & Stephen Machin & Shqiponja Telhaj, 2025. "Personnel policy in public sector organizations: evidence from England's academy schools," CEP Discussion Papers dp2129, Centre for Economic Performance, LSE.
    12. Caliendo, Marco & Cobb-Clark, Deborah A. & Pfeifer, Harald & Uhlendorff, Arne & Wehner, Caroline, 2024. "Managers’ risk preferences and firm training investments," European Economic Review, Elsevier, vol. 161(C).
    13. Achyuta Adhvaryu & Namrata Kala & Anant Nyshadham, 2022. "Management and Shocks to Worker Productivity," Journal of Political Economy, University of Chicago Press, vol. 130(1), pages 1-47.
    14. Weidmann, Ben & Vecci, Joseph & Said, Farah & Bhalotra, Sonia & Adhvaryu, Achyuta & Nyshadham, Anant & Tamayo, Jorge & Deming, David, 2024. "How Do You Identify A Good Manager?," CAGE Online Working Paper Series 715, Competitive Advantage in the Global Economy (CAGE).
    15. Francesco Amodio & Miguel A. Martinez-Carrasco, 2019. "Inputs, Incentives, and Self-selection at the Workplace," Cahiers de recherche 13-2019, Centre interuniversitaire de recherche en économie quantitative, CIREQ.

    More about this item

    Keywords

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    JEL classification:

    • D24 - Microeconomics - - Production and Organizations - - - Production; Cost; Capital; Capital, Total Factor, and Multifactor Productivity; Capacity
    • L2 - Industrial Organization - - Firm Objectives, Organization, and Behavior
    • M11 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Administration - - - Production Management
    • M12 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Administration - - - Personnel Management; Executives; Executive Compensation

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