Organization of Production, the: An International Perspective
The availability of new data has allowed researchers to document very large productivity differences across firms. Research also suggests that these differences differ systematically across countries and are especially large in developing ones. Yet the question of why performance between firms seems to vary so much across countries has received surprisingly little attention. National policies, social norms and differences in managerial practices can all influence productivity at the national level. However, institutional conditions may also shape the way in which production is organized. In most parts of the world, a substantial fraction of economic activity takes place in hybrid forms that exhibit a mix of firm-like and market-like attributes. In this article we argue that understanding the role of groups in production is likely to be key in explaining cross-firm and cross-country differences in performance.
