TITLE:
What Causes the Differences in Management Practices between US and UK? An Application of Decomposition Analysis on Firms across Countries
AUTHORS:
Yi Su, Baoding Liu, Dan Li
KEYWORDS:
Management Practices, Gap, Decomposition Analysis, US, UK
JOURNAL NAME:
Theoretical Economics Letters,
Vol.8 No.10,
June
19,
2018
ABSTRACT: The aim of this study is to examine what makes the
differences of management practices between the United States and the United
Kingdom using decomposition analysis. First, this study analyzes the determinants of
management practices, and does the empirical research. Determinants of
management practices are concluding product market competition, ownership, firm
age, human resources (education, working hours, and payment). Essentially we
argue that the differences (if any) between US and UK’s management practices
can be expanded by product market competition and education. The results
demonstrate that education (managers’ degree and employees’ degree) is positively correlated with management practice
gap, but the impact of competition on management practices gap is negative. In
particular, employees’ degree variables explained approximately 70% of
the management gap.