The Missing Middle Managers: Labor Costs, Firm Structure, and Development /
Hjort, Jonas.
The Missing Middle Managers: Labor Costs, Firm Structure, and Development / Jonas Hjort, Hannes Malmberg, Todd Schoellman. - Cambridge, Mass. National Bureau of Economic Research 2022. - 1 online resource: illustrations (black and white); - NBER working paper series no. w30592 . - Working Paper Series (National Bureau of Economic Research) no. w30592. .
October 2022.
This paper shows that large, multi-establishment business enterprises face a high cost of middle management in poor countries and that this cost inhibits the growth of the modern sector. We provide new empirical evidence using a database covering compensation for 300,000 middle managers working at modern firms in 146 countries. We estimate that the elasticity of real management costs with respect to real GDP per worker is 0.1. We quantify the importance of this finding using a calibrated appropriate technology model where firms choose whether to adopt the management-intensive modern business structure. Lower management costs in developing countries would increase the revenue share of the modern sector by 10-20 percentage points
System requirements: Adobe [Acrobat] Reader required for PDF files.
Mode of access: World Wide Web.
Wages, Compensation, and Labor Costs
Production Management
Macroeconomic Analyses of Economic Development
Economic Growth and Aggregate Productivity
The Missing Middle Managers: Labor Costs, Firm Structure, and Development / Jonas Hjort, Hannes Malmberg, Todd Schoellman. - Cambridge, Mass. National Bureau of Economic Research 2022. - 1 online resource: illustrations (black and white); - NBER working paper series no. w30592 . - Working Paper Series (National Bureau of Economic Research) no. w30592. .
October 2022.
This paper shows that large, multi-establishment business enterprises face a high cost of middle management in poor countries and that this cost inhibits the growth of the modern sector. We provide new empirical evidence using a database covering compensation for 300,000 middle managers working at modern firms in 146 countries. We estimate that the elasticity of real management costs with respect to real GDP per worker is 0.1. We quantify the importance of this finding using a calibrated appropriate technology model where firms choose whether to adopt the management-intensive modern business structure. Lower management costs in developing countries would increase the revenue share of the modern sector by 10-20 percentage points
System requirements: Adobe [Acrobat] Reader required for PDF files.
Mode of access: World Wide Web.
Wages, Compensation, and Labor Costs
Production Management
Macroeconomic Analyses of Economic Development
Economic Growth and Aggregate Productivity