Working Paper: NBER ID: w31335
Authors: Achyuta Adhvaryu; Emir Murathanoglu; Anant Nyshadham
Abstract: We study the allocation and productivity consequences of training production line supervisors in soft skills via a randomized controlled trial. Consistent with standard practice for training investments within firms, we asked middle managers -- who sit above supervisors in the hierarchy -- to nominate members of their supervisory team for training. Program access was randomized within these recommendation rankings. Highly recommended supervisors experienced no productivity gains; in contrast, less-recommended supervisors' productivity increased 12% relative to controls. This was not due to poor information or favoritism. Instead, consistent with the fact that supervisor turnover comes at a large effort cost to middle managers due to gaps in coverage and onboarding, middle managers prioritized retention over productivity impacts. Indeed, treated supervisors were 15% less likely to quit than controls; this gain was most pronounced for highly recommended supervisors. Misallocation of training can help explain the persistence of low managerial quality in firms.
Keywords: managerial training; productivity; soft skills; randomized controlled trial
JEL Codes: J24; L23; M53
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| Productivity gains from training (J24) | More valuable to the firm than retention gains (L21) |
| Training of production line supervisors in soft skills (L23) | Productivity increase for less-recommended supervisors (D29) |
| Training of production line supervisors in soft skills (L23) | Productivity gains among highly recommended supervisors (J24) |
| Training of production line supervisors in soft skills (M53) | Reduced turnover rates among treated supervisors (M51) |
| Training of production line supervisors in soft skills (M53) | Reduced likelihood of quitting for highly recommended supervisors (M51) |
| Training of production line supervisors in soft skills (M53) | Reduced likelihood of quitting for low-recommendation supervisors (M51) |