The Land that Lean Manufacturing Forgot?

43 Pages Posted: 19 Sep 2012

See all articles by Nicholas Bloom

Nicholas Bloom

Stanford University - Department of Economics; National Bureau of Economic Research (NBER)

Helena Schweiger

European Bank for Reconstruction and Development (EBRD) - Office of the Chief Economist

John Van Reenen

London School of Economics - Centre for Economic Performance (CEP); Stanford Graduate School of Business; Institute for Fiscal Studies (IFS); Centre for Economic Policy Research (CEPR)

Date Written: October 2012

Abstract

We have conducted the first large‐scale survey on management practices in transition countries. We found that Central Asian transition countries, such as Uzbekistan and Kazakhstan, have on average very poor management practices. Their average scores are below developing countries such as India. In contrast, the Central European transition countries such as Poland and Lithuania operate with management practices that are only moderately worse than those of Western European countries such as Germany. As we find these practices are strongly linked to firm performance, this suggests that poor management practices may be impeding the development of Central Asian transition countries. We find that competition, multinational ownership, private ownership and human capital are all strongly correlated with better management. If causally interpreted, this would imply that the continued opening of markets to domestic and foreign competition, privatization of state‐owned firms and increased levels of workforce education should promote better management, and ultimately faster economic growth.

Keywords: Management, firm performance, transition economies

JEL Classification: L2, M2, P21

Suggested Citation

Bloom, Nicholas and Schweiger, Helena and Van Reenen, John Michael, The Land that Lean Manufacturing Forgot? (October 2012). Economics of Transition, Vol. 20, Issue 4, pp. 593-635, 2012. Available at SSRN: https://ssrn.com/abstract=2149054 or http://dx.doi.org/10.1111/j.1468-0351.2012.00444.x

Nicholas Bloom (Contact Author)

Stanford University - Department of Economics ( email )

Landau Economics Building, Room 231
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Stanford, CA 94305-6072
United States
650-725-7836 (Phone)

HOME PAGE: http://economics.stanford.edu/faculty/bloom

National Bureau of Economic Research (NBER) ( email )

1050 Massachusetts Avenue
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Helena Schweiger

European Bank for Reconstruction and Development (EBRD) - Office of the Chief Economist ( email )

One Exchange Square
London EC2A 2JN
United Kingdom

HOME PAGE: http://www.helenasch.net

John Michael Van Reenen

London School of Economics - Centre for Economic Performance (CEP) ( email )

Houghton Street
London WC2A 2AE
United Kingdom
+44 20 7955 6976 (Phone)
+44 20 7955 6848 (Fax)

Stanford Graduate School of Business ( email )

655 Knight Way
Stanford, CA 94305-5015
United States

Institute for Fiscal Studies (IFS) ( email )

7 Ridgmount Street
London, WC1E 7AE
United Kingdom
+44 20 7240 6740 (Phone)
+44 20 7240 6136 (Fax)

Centre for Economic Policy Research (CEPR)

London
United Kingdom

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