Management in Production: From Unobserved to Observed

18 Pages Posted: 10 Jun 2013 Last revised: 12 Jun 2015

See all articles by Thomas Triebs

Thomas Triebs

Loughborough University - School of Business and Economics

Subal C. Kumbhakar

State University of New York (SUNY) at Binghamton - Department of Economics

Date Written: November 11, 2014

Abstract

In their seminal paper Bloom and Van Reenen (2007) showed that management practices correlate with firm performance. In many instances empirical researchers do not observe management practices. They usually resort to performance estimates as proxies for management practices. We ask whether two popular proxies – fixed effects and inefficiency scores – correlate with observed management. These proxies assume that management is a technology shifter and that more management is always better. We take advantage of the availability of observed management to investigate how observed management influences the technology using flexible (semiparametric) forms.

Keywords: Management Practice, Production Functions, Stochastic Frontier Analysis

JEL Classification: D24, C14, M11

Suggested Citation

Triebs, Thomas and Kumbhakar, Subal C., Management in Production: From Unobserved to Observed (November 11, 2014). Available at SSRN: https://ssrn.com/abstract=2276642 or http://dx.doi.org/10.2139/ssrn.2276642

Thomas Triebs (Contact Author)

Loughborough University - School of Business and Economics ( email )

Epinal Way
Leics LE11 3TU
Leicestershire
United Kingdom

Subal C. Kumbhakar

State University of New York (SUNY) at Binghamton - Department of Economics ( email )

Binghamton, NY 13902-6000
United States

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