AN ANALYSIS OF MANAGEMENT PRACTICES ACROSS FIRM OWNERSHIP: THE CASE OF STANDALONE DOMESTIC FIRMS, DOMESTIC GROUPS AND MULTINATIONAL ENTERPRISES

Abstract

Management practices are important drivers of firm productivity (Bloom et al., 2019). While differences in the formalisation and sophistication of management practices are evident in comparisons of foreign multinationals and domestic firms (Bloom et al., 2012, Bloom and Van Reenen, 2007a, Bloom and Van Reenen, 2010), a striking omission from many studies is the failure to distinguish between domestic firms and domestically-owned multinationals (McDonnell et al., 2014). We merge the World Management Survey with the FAME dataset to examine the influence of firm ownership (standalone domestic firms; domestic groups; domestic owned multinationals; foreign owned multinationals) across a broad range of management practices. Foreign owned multinationals exhibit the highest formalisation and sophistication of management practices compared to all other firm types. However, significant asymmetries exist between different management practices across firm ownership. This is important as it raises questions as to whether there is sufficient learning and transfer of practices taking place across firms.