Management in Pakistan: Evidence from Sindh, Baluchistan and Khyber Paktunkhawa provinces

The key purpose of this project is to measure management practices, undertake a rigorous empirical analysis of management-performance relationship, and investigate the determinants of management practices in manufacturing establishments in previously inaccessible provinces of Pakistan.

In recent years, economists have started to pay attention to establishment-level management practices, attempting to move beyond selective case studies and into collecting systematic and reliable data on how firms are managed in order to empirically investigate the relationship between management and performance (Bloom et al., 2014). Following this strand of the literature, the project team previously applied the Management and Organizational Practices Survey (MOPS) methodology (developed by Bloom et al., 2013) for the first time to Punjab, Pakistan (to see the previous PEDL project click here). In this project the researchers will collect further management data by extending MOPS to firms in Sindh, Baluchistan and Khyber Paktunkhawa provinces of Pakistan, which have been previously inaccessible to applied-micro researchers due to the lack of administrative data and difficulties in collecting data on the field (challenging law and order situation and difficult access). They aim to investigate how well managed establishments are in these other provinces and whether this explains any uneven growth within Pakistan.

The researcher will send the MOPS along with the Census of Manufacturing Industries (CMI), conducted by the national statistical bureau. Then, they will conduct face-to-face interviews to assess management practices of respondents willing to fill the MOPS. The MOPS and the CMI will be consequently matched to allow a rigorous identification of the strengths and weaknesses in management practices in the provinces and to explore ways in which firms in Pakistan can potentially emulate the development paths of firms in other Asian middle income countries. Besides, the dataset would document between-provinces differences and help to understand the mechanisms of firm upgrading through improved management quality.

This project is relevant to inform policy for two reasons. First, Pakistan (and other developing countries) needs to identify opportunities and existing clusters of excellence across all industries to meet the ambitious target of 5.5% economic growth set for the coming fiscal year. Second, the lack of intra-agency coordination is an equally important impediment for economic growth in Pakistan. The first wave of MOPS has already shown the potential to create strong synergies between the State Bank of Pakistan and the Pakistan Bureau of Statistics (two federal bodies) as it was their first direct collaboration. The current research will further lay the foundations for synergies aiming at institutionalizing MOPS in Pakistan and pave the path for other researchers to work with these federal agencies.