Not All Management Training is Created Equal: Evidence from the Training Within Industry Program
95 Pages Posted: 30 Sep 2019 Last revised: 11 Nov 2019
Date Written: November 10, 2019
This paper examines the effects of management practices on firm performance, using evidence from the Training Within Industry (TWI) program. The TWI plan was a business training program implemented by the U.S. government between 1940 and 1945 to provide management training to firms involved in war production. Using newly collected panel data on all 11,575 U.S. firms that applied to the program, we estimate its causal effects by exploiting quasi-random variation in the allocation of instructors to firms. We find that receiving any TWI training had a positive effect on firm performance. Training in human resources management had the largest impact and was complementary to other management practices. Finally, we document substantial heterogeneity in the effects of the program depending on whether top or middle managers were trained.
Keywords: management training, productivity, human capital, world war II
JEL Classification: L2, M2, N34, N64, O32, O33
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