We find … better managers tend to match with worse workers, & vice versa. This stands in contrast to our estimates of the production technology, which reveal that if the firm were to positively sort, productivity would increase by 1 to 4%" https://www.nber.org/papers/w27006
the paper cites 1-4% improvement for sorting its paywalled so i cant look at their methods, but presumably the authors were aware that making people work outside their expertise in inefficient
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Yah, but the question is if they did this by comparing companies which kept the low productivity workers and managers working together at the company. I don't see how you could even hope to do this and if so then why assume it can all be done by sorting *inside* company.
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i dunno, buy or pirate the paper if you want to look at their methods it seems plausible enough that total productivity is proportionate to team quality times manager quality and 2*2+1*1>2*1+1*2
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I don't doubt that you can achieve this gain by sorting across companies but not sure if it would really make sense inside a single small company.
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why is sorting across companies different from sorting within a company?
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