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What Drives Differences in Management?

Author

Listed:
  • Bloom, Nicholas

    (Stanford University)

  • Brynjolfsson, Erik

    (MIT Sloan School of Management)

  • Foster, Lucia

    (U.S. Census Bureau)

  • Jarmin, Ron

    (U.S. Census Bureau)

  • Patnaik, Megha

    (Stanford University)

  • Saporta-Eksten, Itay

    (Tel Aviv University)

  • Van Reenen, John

    (MIT Sloan School of Management)

Abstract

Partnering with the Census we implement a new survey of "structured" management practices in 32,000 US manufacturing plants. We find an enormous dispersion of management practices across plants, with 40% of this variation across plants within the same firm. This management variation accounts for about a fifth of the spread of productivity, a similar fraction as that accounted for by R&D, and twice as much as explained by IT. We find evidence for four "drivers" of management: competition, business environment, learning spillovers and human capital. Collectively, these drivers account for about a third of the dispersion of structured management practices.

Suggested Citation

  • Bloom, Nicholas & Brynjolfsson, Erik & Foster, Lucia & Jarmin, Ron & Patnaik, Megha & Saporta-Eksten, Itay & Van Reenen, John, 2017. "What Drives Differences in Management?," IZA Discussion Papers 10724, Institute of Labor Economics (IZA).
  • Handle: RePEc:iza:izadps:dp10724
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    References listed on IDEAS

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    More about this item

    Keywords

    learning; competition; productivity; management;
    All these keywords.

    JEL classification:

    • L2 - Industrial Organization - - Firm Objectives, Organization, and Behavior
    • M2 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Economics
    • O32 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Management of Technological Innovation and R&D
    • O33 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Technological Change: Choices and Consequences; Diffusion Processes

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