WP-027:Greer K. Gosnell, John A. List, and Robert D. Metcalfe, "The Impact of Management Practices on Employee Productivity: A Field Experiment with Airline Captains" (Revised April 2019)
Increasing evidence indicates the importance of management in determining firms' productivity. Yet, causal evidence regarding the effectiveness of management practices is scarce, especially for high-skilled workers in the developed world. In an eight-month field experiment measuring productivity gains in the commercial aviation sector, we test four distinct management practices: (i) performance monitoring; (ii) performance feedback; (iii) target setting; and (iv) prosocial incentives. We find that these management practices - particularly performance monitoring and target setting - significantly increase captains' productivity with respect to targeted fuel-saving dimensions. We identify positive spillovers of the tested management practices on job satisfaction and carbon dioxide emissions, and captains overwhelmingly express desire for deeper managerial engagement. Both the implementation and the results of the study reveal an uncharted opportunity for management researchers to delve into the black box of firms and rigorously examine the determinants of productivity among skilled labor.