Does Management Matter? Evidence from India *
Open accessAbstract
A long-standing question is whether differences in management practices across firms can explain differences in productivity, especially in developing countries where these spreads appear particularly large. To investigate this, we ran a management field experiment on large Indian textile firms. We provided free consulting on management practices to randomly chosen treatment plants and compared their performance to a set of control plants. We find that adopting these management practices raised productivity by 17% in the first year through improved quality and efficiency and reduced inventory, and within three years led to the opening of more production plants. Why had the firms not adopted these profitable practices previously? Our results suggest that informational barriers were the primary factor explaining this lack of adoption. Also, because reallocation across firms appeared to be constrained by limits on managerial time, competition had not forced badly managed firms to exit.
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References 63 · Cited by 1,418
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- Authors
- Bloom, N., Eifert, B., Mahajan, A., McKenzie, D., & Roberts, J.
- Affiliations
- Center for Economic and Policy Research (US)
- Stanford University (US)
- World Bank (US)
- Venue
- The Quarterly Journal of Economics
- Publisher
- Oxford University Press (OUP)
- Published
- 2012-11-18
- Volume
- 128
- Issue
- 1
- Pages
- 1-51
- ISSN
- 0033-5533 (ISSN-L)
- 1531-4650
- OpenAlex
- W2262603336
- Cited by
- 1,418
- References
- 63
- Citations by year
- 2026: 84 · 2025: 88 · 2024: 99 · 2023: 131 · 2022: 125 · 2021: 152 · 2020: 127 · 2019: 114 · 2018: 109 · 2017: 93 · 2016: 91 · 2015: 74 · 2014: 57 · 2013: 42 · 2012: 22
- FWCI
- 106.90
- Type
- journal article
- Language
- en
- Open access
- bronze
- doi.org
- Locations
- The Quarterly Journal of Economics (publishedVersion)
- National Bureau of Economic Research (publishedVersion)
- London School of Economics and Political Science Research Online (London School of Economics and Political Science) (acceptedVersion)
- London School of Economics and Political Science Theses Online (London School of Economics and Political Science) (acceptedVersion)
- RePEc: Research Papers in Economics (submittedVersion)
- London School of Economics and Political Science Theses Online (London School of Economics and Political Science) (submittedVersion)
- SSRN Electronic Journal (submittedVersion)
- eScholarship (California Digital Library) (submittedVersion)
- Funders
- National Science Foundation
- Ewing Marion Kauffman Foundation
- Alfred P. Sloan Foundation
- World Bank Group
- European Bank for Reconstruction and Development
- Harvard Business School
- London School of Economics and Political Science
- International Growth Centre (WC2A 2AE)
- KU Leuven
- Stanford Institute for Research in the Social Sciences
- Economic and Social Research Council (ES/H02123X/1)
- Topics
- Social Sciences › Safety Research › Experimental Behavioral Economics Studies
- Social Sciences › Business, Management and Accounting › Organizational Behavior and Human Resource Management › Management Theory and Practice
- Social Sciences › Economics, Econometrics and Finance › Economics and Econometrics › Firm Innovation and Growth
- Keywords
- management practices, firm performance, textile industry, productivity, quality, inventory reduction, information flow, delegation, computer adoption, diffusion of management practices, information barriers, India
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