TITLE: Identifying Managerial Skill (joint with: Ben Weidmann (Harvard), Joe Vecci (Gothenburg), Farah Said (Lahore), David Deming (Harvard))

ABSTRACT: We know that managers matter but we do not know how to prospectively identify good managers. We demonstrate the potential of using repeated random assignment to identify the causal contribution managers make to teams, and the measurable skills associated with this. We randomly assign managers to multiple teams, and predict team performance based on the team’s endowment of productive skill. Some managers consistently cause their teams to exceed predicted performance. Managerial skills are roughly as important to team outcomes as worker productivity. Good managers score higher on measures of allocative skill, and there are no differences in managerial skill across gender, age and ethnicity. We experimentally evaluate different methods of manager selection. People who select into managerial roles are typically not better managers than those appointed by lottery. However, selecting managers based on allocative skill dramatically improves team performance.

Title: Diversity and Discrimination in the Classroom, joint with Dan Anderberg, Christina Felfe, Helmut Rainer and Thomas Siedler.

Abstract: What makes diversity unifying in some settings but divisive in others? We examine how the mixing of ethnic groups in German schools affects intergroup cooperation and trust. We leverage the quasi-random assignment of students to classrooms within schools to obtain variation in the type of diversity that prevails in a peer group. We combine this with a large-scale, incentivized lab-in-field-experiment based on the investment game, allowing us to assess the in-group bias of native German students in their interactions with fellow natives (in-group) versus immigrants (out-group). We find in-group bias peaks in culturally polarized classrooms, where the native and immigrant groups are both large, but have different religious or language backgrounds. In contrast, in classrooms characterized by non-cultural polarization, fractionalization, or a native supermajority, there are significantly lower levels of own-group favoritism. We find empirical evidence that culturally polarized classrooms foster negative stereotypes about immigrants' trustworthiness and amplify taste-based discrimination, both of which are costly and lead to lower payouts. In contrast, accurate statistical discrimination is ruled out by design in our experiment. Consistent with a simple model, discrimination in culturally polarized classrooms is associated with lower levels of intergroup friendship and larger identity gaps. Taken together, these findings suggest that extra efforts are needed to counteract low levels of inclusivity and trust in culturally polarized environments.