CHAPTER 10 Input Demand: The Labor and Land Markets 245 ECONOMICS IN PRACTICE Do Managers Matter? Many of you will likely someday go on to work as managers in firms. As you study productivity and think about your future, you might wonder about how managers, like the one you will become, can affect the productivity of the people who work for them. A recent field experiment run by several econo- mists (and former consultants) has some interesting things to say about this. Bloom, Eifert, Mahajan, Mckenzie, and Roberts, econo- mists from a range of places including Stanford University and the World Bank, recently published a paper describe ing a field experiment they ran on a group of large Indian textile firms. Using a sample of several dozen firms, the researchers randomly sorted those firms into one of two groups. In the treatment group firm managers received five months of extensive management training from a large international consulting group. They were taught a range of operational practices that earlier research had THINKING PRACTICALLY suggested might be effective. A second, control group received a shorter period of diagnostic consulting, with no 1. Many of the firms treated had multiple plants. After training. the researchers left, what do you think they did The results? Within the first year after treatment, pro- about training in their other plants? ductivity in the treated plants increased by 17%. One of the authors of this textbook teaches MBA students and was ! Nicholas Bloom, Benn Eifert, Aprajit Mahajan, David Mckenzie, and John Roberts, "Does Management Matter: Evidence from India." Quarterly Journal pleased to read these results! of Economics (2013): 1-51