Management Practices Across Firms and Countries
Paper No' CEPDP1109:
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Keywords: management; organization, and productivity
JEL Classification: L2; M2; O14; O32; O33
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This Paper is published under the following series:
CEP Discussion Papers
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For the last decade we have been using double-blind survey techniques and randomized sampling to
construct management data on over 10,000 organizations across twenty countries. On average, we
find that in manufacturing American, Japanese, and German firms are the best managed. Firms in
developing countries, such as Brazil, China and India tend to be poorly managed. American retail
firms and hospitals are also well managed by international standards, although American schools are
worse managed than those in several other developed countries. We also find substantial variation in
management practices across organizations in every country and every sector, mirroring the
heterogeneity in the spread of performance in these sectors. One factor linked to this variation is
ownership. Government, family, and founder owned firms are usually poorly managed, while
multinational, dispersed shareholder and private-equity owned firms are typically well managed.
Stronger product market competition and higher worker skills are associated with better management
practices. Less regulated labor markets are associated with improvements in incentive management
practices such as performance based promotion.