Countries and Firms Explaining Managerial Performances

Abstract

A large body of research in recent years result in the growth of knowledge about better or worse management practices. However, comparative research using ?rm-level data has been limited by the different styles on management and by the unavailability of homogeneous data sources, especially in former transition and Asian countries. This study ?lls this gap, by using the ?rm-level survey by EBRD and World Bank (BEEPSV-MENA ES, 2012-2014) and by looking at the determinants of a Management Quality Score (MQS) for more than 17.000 ?rms in 36 countries of Central Asia, Eastern Europe and Northern Africa. We ?nd that both, country and ?rm characteristics, matter for managerial skills but they weight differently. In fact the country-groupings change, accelerate or dampen the impact of ?rms characteristics on management performance so that different channels are conducive to better managerial practices. Competition, education, and technology are the important channels for the high-income countries, whereas global value chain participation and ownership are the signi?cant channels for the low-income countries. In particular, GVC participation enhances signi?cantly managerial practices of ?rms in low-income countries especially for the lower quartile ?rms. Hence, this study provides empirical support for an interplay between country and ?rm characteristics in transitional and emerging markets. In addition, it provides support for an enhanced connection between business environment reforms devoted to managerial upgrading and industrial policy devoted to enhancing best-performing ?rms characteristics. As such, it suggests that only their complementary and targeted use can support management and business practices upgrading.