The Productivity Puzzle, Management Practices and Leadership

The research direction of this thesis is sparked by the puzzling variation in productivity among firms, underscoring the importance of understanding the drivers of productivity better. This thesis encompasses three empirical studies, each tackling a distinct challenge in productivity and management research. It is grounded in the framework of the World Management Survey (WMS), which offers a standardized approach to assess management practices and their relation to differences in performance indicators like firm productivity.The first study explores the universality of people management practices within the WMS framework across fourteen countries. It focuses on the role of firm-level human capital, and the cultural values and employment protection legislation in firms’ institutional environment. The results suggest that firms’ human capital is positively associated with people management practices’ effectiveness, and that the practices are universally linked to productivity without being significantly moderated by cultural context or regulatory factors of employment protection.The second study taps into individual managers’ role and investigates the influence of CEOs' instrumental leadership behaviors alongside management practices for firm productivity. Analyzing data from Dutch manufacturing firms, it concludes that both CEO leadership behaviors and management practices independently are associated with productivity, emphasizing the unique roles of CEOs and firm management.The third study examines the link between management practices, productivity, and export performance in Dutch manufacturing firms. It finds that better-managed firms tend to have higher productivity and export revenues, suggesting a relationship between management practices’ role in firm productivity and the heterogeneity in firms’ export performances