Management practices and the wealth of nations
Team Leaders: Nick Bloom, Renata Lemos, Raffaella Sadun, and Daniela Scur
When people think of technologies, they do not often think of management. But the typical measures of "hard technologies" such as patents, R&D, and the diffusion of Information and Communication Technology (ICT), robots, AI, etc. typically leave a large "residual" to be explained. Furthermore, the impact of such technologies on firm performance varies tremendously depending on the managerial quality of the adopting organization.
Pioneering work by POID researchers has established new methods for measuring management quality. This has been implemented in over 20,000 interviews with firms from almost 40 countries since 2002. More information is available on the World Management Survey website.
- "Measuring and Explaining Management Practices across Firms and Countries" Nicholas Bloom and John Van Reenen, Quarterly Journal of Economics, 122(4), 1341-1408.
- "Why Do We Undervalue Competent Management" (with Raffaella Sadun and Nick Bloom), Harvard Business Review, September-October, winner of HBR-McKinsey Prize for best article of the year interview reprinted in HBR's 10 Must Reads 2019.
A number of our projects builds on this work
Expanding the World Management Survey (WMS)
The last full wave of the WMS was in 2014, so we plan to conduct a new wave in 2022 to create the largest international longitudinal survey of management practices in the world.
Structural models of management (Bloom, Sadun and Van Reenen)
How should we build management into macro-economic models? We propose a structural approach that examines how improved management practices spread through the economy.
Measuring Management in New Sectors (Anna Valero and Sandra McNally)
When the WMS started, the focus was on manufacturing where productivity is easier to measure. Since then we have expanded the work to cover most sectors of the economy including retail, hospitals, primary care, high schools, universities, and the civil service. Most recently, we have been looking at Further Education Colleges, a critical area for developing vocational and technical education (where the UK has been historically weak). Read more here.
Infrastructure on Management Data with National Statistical Agencies
A problem with the WMS method is sheer cost. IT requires high level and in-depth training of our interviewers who have talked to tens of thousands of middle managers all over the world. In response to this, we have developed the Management and Organizational Practices Survey (MOPS), which is more of a traditional "closed question" survey technique.
This was first implemented in the US with the Census Bureau where it was a mandatory survey. We are now in our third wave of US MOPS giving us data from 2005 onwards. It has also been implemented in nine other countries including the UK (also on the third wave of MES - the Management and Expectations Survey).
Our vision is to make MOPS part of the data infrastructure countries can access.
"What drives differences in management?" (with Nick Bloom, Erik Brynjolfsson, Lucia Foster, Ron Jarmin, Megha Patnaik and Itay Saporta-Eksten), American Economic Review (2019) 109(5) 1648-1683.
The Natural Laws of Management (Scott Ohlmacher)
With MOPS and WMS, we are writing a paper pulling together the key stylized facts that we observe on management across all the countries in our data.
Management and Expectations (Rebecca Riley, Paul Mizen, Tatsuo Senga)
Is one of the advantages of better management, a higher ability to make accurate forecasts and therefore wiser decisions on inputs and outputs? We are investigating this using UK MES data.
For a preliminary assessment from the first wave of MES see
"A firm-level perspective on micro- and macro-level uncertainty" (with Gaganan Awano, Nicholas Bloom, Ted Dolby, Paul Mizen, Rebecca Riley, Tatsuro Senga, Jenny Vyas and Philip Wales).
Drivers of Management
What are the factors that determine the diffusion of managerial practices? This is a core question for us that we are assessing in a number of papers. Some aspects we are focusing on include the structure of markets: product, labour, financial; trade and FDI; regulations; human capital; conflict and government policies.
Some of this work involves "deep dives" into particular countries such as Mexico and Pakistan.
"Constraints on Developing UK Management Practices" (with Nick Bloom, Renata Lemos, Mingxuan Qi and Raffaella Sadun).
To causally evaluate management interventions the "gold standard" is randomized control trials. We have performed many of these, often collaborating with other partners.
We have a number of ongoing projects in the UK, Kenya and around the world.
Bloom, Nicholas, Ben Eifert, Abrijit Mahajan, David McKenzie and John Roberts (2013) "Does management matter? Evidence from India" Quarterly Journal of Economics 128 (1): 1-51.
Bloom, Nicholas, Abrijit Mahajan, David McKenzie and John Roberts (2019) "Do Management Interventions Last? Evidence from India" AEJ: Applied 11(4) 198-219.
OxREP Special Issue (forthcoming).
"The World Management Survey at 18" (with Nick Bloom, Renata Lemos, Raffaella Sadun and Daniela Scur), forthcoming Oxford Review of Economic Policy.
Adelman, Melissa and Renata Lemos (2021) "Managing for learning: measuring and strengthening education management in Latin America and the Caribbean" World Bank, Washington, DC.