No Line Left Behind: Assortative Matching Inside the Firm

69 Pages Posted: 22 Oct 2019 Last revised: 16 Sep 2021

See all articles by Achyuta Adhvaryu

Achyuta Adhvaryu

University of Michigan at Ann Arbor

Vittorio Bassi

University of Southern California - Department of Economics

Anant Nyshadham

Boston College - Department of Economics

Jorge Tamayo

Harvard University - Business School (HBS)

Multiple version iconThere are 3 versions of this paper

Date Written: September 23, 2019

Abstract

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) – i.e., better workers tend to match with worse managers. Estimates of the production technology, however, reveal that productivity would increase by up to 4% under positive sorting. Coupling these findings with a survey of managers and data on orders from multinational brands, we document that NAM arises partly because maintaining valuable relationships with buyers provides strong incentives to avoid delays on any given production line.

Keywords: Assortative Matching, Management, Productivity, Global Buyers, Readymade Garments, India

JEL Classification: J24, L14, L23, M5

Suggested Citation

Adhvaryu, Achyuta and Bassi, Vittorio and Nyshadham, Anant and Tamayo, Jorge A., No Line Left Behind: Assortative Matching Inside the Firm (September 23, 2019). Available at SSRN: https://ssrn.com/abstract=3462873 or http://dx.doi.org/10.2139/ssrn.3462873

Achyuta Adhvaryu

University of Michigan at Ann Arbor ( email )

500 S. State Street
Ann Arbor, MI 48109
United States

Vittorio Bassi (Contact Author)

University of Southern California - Department of Economics ( email )

3620 South Vermont Ave. Kaprielian (KAP) Hall, 300
Los Angeles, CA 90089
United States

Anant Nyshadham

Boston College - Department of Economics ( email )

140 Commonwealth Avenue
Chestnut Hill, MA 02467
United States

Jorge A. Tamayo

Harvard University - Business School (HBS) ( email )

Soldiers Field Road
Morgan 270C
Boston, MA 02163
United States

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