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Managerial Quality and Productivity Dynamics

Author

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  • 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. 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).
    2. 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.
    3. 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.

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