This paper proposes a model of production where technical change is both time and management induced. The authors define a general management index in addition to the general time index of Baltagi and Griffin (1988) and use them as arguments in the translog production function. Time and management induced technical change are then defined in terms of these general indices. For comparison, the authors also consider models in which time and management are specified as continuous variables. We report empirical results for a sample of manufacturing firms in the US, UK, Germany and France.

This paper examines whether and, if so, why source country heterogeneity exists in foreign direct investment (FDI). Using detailed data on all Swedish firms for the period from 1996 to 2009, we find statistical evidence that affiliate performance differs systematically across source countries. For instance, affiliates of US multinational enterprises (MNEs) are, on average, approximately three times more productive than affiliates headquartered in the Nordic countries. One possible explanation for these discrepancies is differences in organization practices across source countries. Using new firm-level data from the World Management Survey to estimate a global index of the quality of management practices for MNEs with headquarters in our source countries of interest, we find that source country heterogeneity in affiliate performance is highly correlated with differences in management practices.

The large regional variation in minimum wage levels in the period 2002-08 in China
implies that Chinese manufacturing firms experienced competitive shocks as a function of firm location and their low-wage employment share. We find that minimum
wage hikes accelerate the input substitution from labor to capital, reduce employment growth and accelerate total factor productivity growth–particularly among the less productive firms under private Chinese or foreign ownership, but not among state-owned enterprises. The heterogeneous firm response to labor cost shocks can be explained by differences in management practices, and suggests that management quality and competitive pressure are complementary.

We study the impact of directors with foreign experience on firm performance in emerging markets. Using a unique data set from China, we exploit the introduction of policies to attract talented emigrants and increase the supply of individuals with foreign experience in different provinces at different times. We document that performance increases after firms hire directors with foreign experience and identify the channels through which the emigration of talent may lead to a brain gain. Our findings provide evidence on how directors transmit knowledge about management practices and corporate governance to firms in emerging markets.

Are productivity estimates good proxies for unobserved management? And, does management affect production in a neutral and monotonic fashion as assumed by these proxies? We use Bloom and Van Reenen’s management data to show that two popular proxies, fixed effects and inefficiency scores, correlate with observed management practices. We find that the correlations are positive but weak. Also, management explains only a fraction of the proxies’ variances. The data rejects the assumptions of neutrality and monotonicity. Last, our results suggest that management has characteristics both of a technology and an input.

This paper examines the relationship between modern management practices and the demand for different occupational skills utilizing a unique context in South Korea after the Asian financial crisis. Management practices in South Korea had traditionally emphasized the organizational harmony over individual performance, and firm growth over short-term profits. However, as South Korea opened up to foreign firms after the financial crisis, domestic firms started to adopt western or more “modern” management practices. Using the industry level variation in management practices generated by the average industry management index of five advanced economies (the US, Britain, France, Germany, and Italy), I find that modern management increases the demand for technical skill. Moreover, modern management practices help achieve various organizational changes that utilize information technology. I also find that performance measured as the return on asset increases with modern management practices, and document the complementarity between modern management practices and technical workers in increasing the return on assets. In short, this paper finds that modern management practices may increase the earnings difference between skilled – in particular, technically skilled – and unskilled workers.

We analyze the management input from the perspective of shadow cost minimization. Using Bloom and Van Reenen’s management measure, we estimate management’s shadow price, dual Morishima elasticities of substitution, and relative price efficiencies. We find that the shadow price of management is about 1.3 million US dollars. Management is a weak dual complement for labor but a strong dual complement for capital. Increases in management reduce the relative income share of labor but not capital. Most firms use too little management, but relative use of management improves over time, with the combination of ownership and control, and competition.

This paper investigates how management practices as intangible transfers are associated with the performance of multinational business groups. Differences in the management level across source countries are predictive for multinationals’ investment patterns for a given destination country. This study argues that acquisitions are a means to transplant management practices from parents to affiliates abroad. It finds that better-managed parents decrease employment and increase productivity post-acquisition. The productivity gains are driven by targets with less developed management practices and by targets of larger parents. Better-managed parents are also more likely to install or retain a manager from the home country post-acquisition.

Using a tried and tested measure of management practices that has been shown to predict firm performance, we survey nearly 250 departments across 100+ UK universities. We find large differences in management scores across universities and that departments in older, research-intensive universities score higher than departments in newer, more teaching-oriented universities. We also find that management matters in universities. The scores, particularly with respect to provision of incentives for staff recruitment, retention and promotion are correlated with both teaching and research performance conditional on resources and past performance. Moreover, this relationship holds for all universities, not just research-intensive ones.

Further Education and Sixth Form Colleges are key institutions for facilitating skill acquisition among 16-19 year olds in the UK. They enrol half a school cohort after completion of their lower secondary education and this includes a disproportionate number from low-income backgrounds. Yet, little is known about what could improve performance in these institutions. We conduct the world’s first management practices survey in such institutions and match this to administrative longitudinal data on over 40,000 students. Value added regressions with rich controls suggest that structured management matters for educational outcomes, especially for students from low-income backgrounds. For this group, in a hypothetical scenario where an individual is moved from a college at the 10th percentile of management practices to the 90th, this would be associated with 8% higher probability of achieving a good high school qualification, nearly half of the educational gap between those from poor and non-poor backgrounds. Hence, improving management practices may be an important channel for reducing inequalities.

Efforts to understand how to improve the delivery of substance abuse treatment have led to a recent call for studies on the “business of addiction treatment.” This study adapts an innovative survey tool to collect baseline management practice data from 147 addiction treatment programs enrolled in the Network for the Improvement of Addiction Treatment (NIATx) 200 project. Measures of “good” management practice were strongly associated with days to treatment admission. Management practice scores were weakly associated with revenues-per-employee, but were not correlated with operating margins. Better management practices were more prevalent among programs with a higher number of competitors in their catchment area.

We study how the management practices bureaucrats operate under correlate with the quantity of public services delivered, using data from the Nigerian Civil Service. We have hand-coded independent engineering assessments of 4,700 project completion rates. We supplement this with a management survey in the bureaucracies responsible for these projects, building on Bloom and Van Reenen (2013). Management practices matter: increasing bureaucrats’ autonomy is positively associated with completion rates, yet practices related to incentives/monitoring of bureaucrats are negatively associated with completion rates. Our evidence provides new insights on the importance of management in public bureaucracies in a developing country setting.