Organizational forms relate to trust, rule of law

Peter Klein highlights a new paper on relating institutional arrangements to institutional environment:

I’m particularly interested in the measurement of decentralization. As noted before, organizational form is not easy to capture in large samples of firms (especially across countries). Bloom, Sadun, and Van Reenen use an original survey, distributed to several thousand plant managers in twelve countries, that asks (a) how much capital investment the plant manager can make without authorization from corporate HQ and (b) where decisions about hiring, new product introductions, and sales and marketing strategies are made. An innovative approach that deserves a closer look.

The paper notes that IT is complementary with decentralization.  Although I am often skeptical of small-n claims and “personal stories” as means for making generalizations, my experience managing IT operations over several countries at different stages of development maps to the findings of the study.  Like Klein, I would like to see more studies of this type.

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