Management Practices and Firm Performance in Developing Economies
Summary
The study of management practices and firm performance in developing economies examines how organisational routines, incentive structures and institutional contexts shape productivity and growth in resource-constrained settings. Empirical evidence reveals substantial variation in adoption of structured management techniques—such as performance monitoring, target setting and talent management—across micro, small and medium firms in regions lacking robust formal institutions. Key challenges include misaligned incentives within firms that hinder technology uptake, limited access to managerial talent in thin labour markets and reliance on informal mechanisms for enforcement where legal systems are weak. Research highlights the complementarity between human capital and managerial innovation, showing that better-educated managers and workers can more effectively implement modern practices. Moreover, interventions offering customised guidance and follow-up support demonstrate the critical role of implementation assistance in securing sustained improvements. Understanding these dynamics is essential for policymakers and development agencies seeking to foster firm-level productivity, boost employment and integrate firms into global value chains.
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Management Practices and Firm Performance in Developing Economies publication trend
The graph below shows the total number of articles in management practices and firm performance in developing economies across all publications each year (not limited to Nature Index journals).
Technical terms
Piece-rate pay: A compensation system where workers are paid according to the quantity of units produced rather than a fixed wage.
Relational contracting: Informal agreements grounded in repeated interactions, trust and mutual reputation rather than formal legal contracts.
Markup: The percentage difference between the cost of production and the sale price of a product, reflecting firm pricing power.
Implementation support: Structured guidance and supervision provided to ensure effective adoption of new practices over time.
References
- Organizational Barriers to Technology Adoption: Evidence from Soccer-Ball Producers in Pakistan*. The Quarterly Journal of Economics (2017).
- Buyers’ Sourcing Strategies and Suppliers’ Markups in Bangladeshi Garments. The Quarterly Journal of Economics (2023).
- Management, supervision, and healthcare: A field experiment. Journal of Economics & Management Strategy (2022).
- Skill-Biased Management: Evidence from Manufacturing Firms. The Economic Journal (2020).
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