Exploring the effects of good and bad bosses on employee productivity, this chapter discusses real-life examples and media portrayals of terrible bosses like Scott Rudin. It examines the influence of bosses on employee outcomes, highlighting a study that shows a significant productivity increase when moving from an average boss to a high-quality boss. The chapter also delves into the challenges of measuring boss qualities like compassion and the frustrations faced by economists in defining what makes a good boss.
People who are good at their jobs routinely get promoted into bigger jobs they’re bad at. We explain why firms keep producing incompetent managers — and why that’s unlikely to change.
- SOURCES:
- Nick Bloom, professor of economics at Stanford University.
- Katie Johnson, freelance data and analytics coach.
- Kelly Shue, professor of finance at the Yale University School of Management.
- Steve Tadelis, professor of economics at the University of California, Berkeley Haas School of Business.
- RESOURCES:
- “People Management Skills, Employee Attrition, and Manager Rewards: An Empirical Analysis,” by Mitchell Hoffman and Steven Tadelis (Journal of Political Economy, 2021).
- “Promotions and the Peter Principle,” by Alan Benson, Danielle Li, and Kelly Shue (The Quarterly Journal of Economics, 2019).
- “Bosses Matter: The Effects of Managers on Workers’ Performance,” by Kathryn L. Shaw (IZA World of Labor, 2019).
- “The Value of Bosses,” by Edward P. Lazear, Kathryn L. Shaw, and Christopher T. Stanton (Journal of Labor Economics, 2015).
- The Peter Principle: Why Things Always Go Wrong, by Laurence J. Peter and Raymond Hull (1969).