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Managerial Quality and Productivity Dynamics

Review of Economic Studies 2023 90(4), 1569-1607 open access
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.

The Light and the Heat: Productivity Co-Benefits of Energy-Saving Technology

The Review of Economics and Statistics 2020 102(4), 779-792 open access
We study the adoption of energy-efficient LED lighting in garment factories around Bangalore, India. Combining daily production line–level data with weather data, we estimate a negative, nonlinear productivity-temperature gradient. We find that LED lighting raises productivity on hot days. Using the firm's costs data, we estimate that the payback period for LED adoption is less than one-third the length after accounting for productivity co-benefits. The average factory in our data gains about $2,880 in power consumption savings and about $7,500 in productivity gains.

Returns to On-the-Job Soft Skills Training

Journal of Political Economy 2023 131(8), 2165-2208
We estimate productivity gains of 13.5% from workplace soft skills training among Indian garment workers. Productivity gains are greater when trainees work on joint operations alongside other coworkers, consistent with gains being driven by improved teamwork and collaboration. Furthermore, untreated coworkers on the treated production lines also show increased productivity. These improvements in the teamwork substitute for managerial attention. Despite productivity gains and higher promotion probabilities among treated workers, there are no effects on wages or retention, consistent with frictions in this labor market. Consequently, the net return to the firm was large: 256% 8 months after program completion.

Management and Shocks to Worker Productivity

Journal of Political Economy 2022 130(1), 1-47 open access
We study how managers mitigate the negative impacts of environmental shocks. Pairing productivity data from a garment firm with granular measures of air pollution, we show that productivity suffers as a result of pollution shocks but that managers respond by reallocating particularly sensitive workers to improve worker-to-task matches, thus mitigating team productivity losses. Responses are smaller for more inattentive managers; these same managers are also least able to mitigate productivity declines. These patterns are confirmed by leveraging variation in opportunities for reallocation and comparing how close managers of differing attentiveness can get to the simulated production frontier by reallocating workers.

Early Life Circumstance and Adult Mental Health

Journal of Political Economy 2019 127(4), 1516-1549 open access
We show that psychological well-being in adulthood varies with circumstance in early life. Combining a time series of real producer prices of cocoa with a nationally representative household survey in Ghana, we find that a one standard deviation rise in the cocoa price in early life decreases the likelihood of severe mental distress in adulthood by 3 percentage points (half the mean prevalence) for cohorts born in cocoa-producing regions relative to those born in other regions. Impacts on related personality traits are consistent with this result. Maternal nutrition, reinforcing childhood investments, and adult circumstance are likely operative channels of impact.

No Line Left Behind: Assortative Matching Inside the Firm

The Review of Economics and Statistics 2024
We leverage the high degree of worker mobility across production lines in a large Indian manufacturer to estimate the sorting of workers to managers, using data on daily worker productivity. We find negative assortative matching (NAM): better workers tend to be matched with worse managers. Estimates of the production technology, however, reveal that productivity would increase by up to 4% under positive sorting. Exploiting a survey of managers and data on orders from multinational brands, we document that NAM arises, at least partly, because maintaining valuable relationships with buyers provides strong incentives to avoid delays on any given production line.

When It Rains It Pours: The Long-Run Economic Impacts of Salt Iodization in the United States

The Review of Economics and Statistics 2020 102(2), 395-407 open access
In 1924, the Morton Salt Company began nationwide distribution of iodine-fortified salt. Access to iodine, a key determinant of cognitive ability, rose sharply. We compare outcomes for cohorts exposed in utero with those of slightly older, unexposed cohorts, across states with high versus low baseline iodine deficiency. Income increased by 11%, labor force participation rose 0.68 percentage points, and full-time work went up 0.9 percentage points due to increased iodine availability. These impacts were largely driven by changes in the economic outcomes of young women. In later adulthood, both men and women had higher family incomes due to iodization.

How Do You Identify a Good Manager?

Quarterly Journal of Economics 2026 141(2), 1581-1633 open access
We introduce and validate a novel approach to identifying good managers. In a preregistered lab experiment, we causally identify managerial contributions by randomly assigning managers to teams and controlling for individual skill. We find that manager contributions are crucial for team success, and that people who self-select into management roles perform worse than randomly assigned managers. Managerial performance is strongly predicted by economic decision-making skill but not by demographic characteristics. Two validation studies support our experimental results. Participants who succeed in the lab receive more real-world promotions and, in a separate study of retail store managers, skill measures strongly predict store sales. A one standard deviation increase in manager quality increases annual per store sales by US$4.1 million (25% increase). Selecting managers on skills rather than demographic characteristics or the desire to lead could substantially improve organizational performance.