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Quarterly Journal of Economics Vol. 141 No. 2 2026

How Do You Identify a Good Manager?

Ben Weidmann1; Joe Vecci2; Farah Said3; Sonia Bhalotra4; Achyuta Adhvaryu5; Anant Nyshadham6; Jorge Tamayo7; David Deming8

1 University College London and London School of Economics , · 2 University of Gothenburg · 3 Lahore University of Management Sciences · 4 University of Warwick, Institute for Fiscal Studies, Centre for Economic Policy and Research, United Kingdom, CESifo, Institute of Labor Economics , · 5 University of California San Diego, National Bureau of Economic Research, Abdul Latif Jameel Poverty Action Lab, Bureau for Research & Economic Analysis of Development, Good Business Lab , · 6 University of Michigan, National Bureau of Economic Research, Abdul Latif Jameel Poverty Action Lab, Bureau for Research & Economic Analysis of Development, Good Business Lab , · 7 Harvard Business School and Digital Reskilling Lab , · 8 Harvard Kennedy School and National Bureau of Economic Research ,

open access

Abstract

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.

DOI
10.1093/qje/qjag004
Volume
141
Issue
2
Pages
1581-1633
Language
en
Sources
crossref openalex

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