John Van Reenen has established an international reputation as a scholar of the economics of consequences and causes of innovation. He works on the applied econometrics of industrial organization and labor economics, especially areas relating to productivity growth, management and organizational practices, R&D, anti-trust, intellectual property, policy evaluation and investment decisions.

John Van Reenen has been a full Professor of Economics at the London School of Economics, and Director of the Centre for Economic Performance since 2003. He graduated with a First from Cambridge University (Queens College) with the highest mark in a decade before completing a Masters degree (with distinction) from the LSE, and doing his PhD at University College London in 1993. He has been a Visiting Professor at the University of California, Berkeley, and a Professor at University College London. He has published over 40 refereed papers in international journals, including the American Economic Review and the Quarterly Journal of Economics. He has also been an editor of many journals, including the Journal of Economic Literature, Journal of Industrial Economics, and the Review of Economic Studies. He has served as a senior advisor to the UK Prime Minister, Secretary of State for Health, and the European Commission. Formerly, he was a partner in an economic consultancy company, Lexecon, and Chief Technology Officer in a software start-up. He frequently appears in newspapers, radio, and TV.

John Van Reenen, Professor of Economics and Director of the Centre for Economic Performance at the London School of Economics, and the Denning Visiting Professor in Global Business and the Economy at Stanford’s Graduate School of Business, offered an FSI Director’s seminar on March 4, looking at “Management Matters: Firm Level Evidence from Around the World.” Finding a dearth of empirical evidence on international management practices, and how they affect business performance and productivity across firms and across countries, Van Reenen and colleagues Nick Bloom, Christos Genakos, and Rafaella Sadum set out to remedy that deficit.

Van Reenen and colleagues developed a new methodology to measure global management practices, scoring firms in three areas: how well they track what goes on inside their firms, how they set targets and trace outcomes, and how effectively they use incentives to address and reward performance. Drawing on interview data from 5,000 firms in 15 countries across the Americas, Asia, and Europe, the researchers found that better performance is correlated with better management.  U.S. firms had the highest average management practice scores followed by Germany, Sweden, and Japan.

Asking why management practices vary so much, they found that multinational firms and firms operating in highly competitive markets have better management practices, while family owned firms and firms facing extensive labor market regulation have the worst. These four factors accounted for half of the variation in management practice scores across firms and across countries.

What makes some governments perform better than others? With rising levels of decentralization and local democracy, the focus of "good governance" is increasingly shifting from national to subnational levels. While much of the existing development literature remains preoccupied with formal institutional and society-centered explanations, there is growing evidence that local policy reforms are strongly affected by informal norms and elite-centered processes.

Post-Suharto Indonesia, a country with one of the most pronounced shifts to democratic decentralization anywhere in recent history, is a case in point. Drawing on empirical comparisons across ten districts (comprising 1000 business surveys and 150 interviews), Dr. von Luebke argues that societal pressures are often less significant in explaining policy differences than the quality of local government leadership. In the early transition to democracy, local firms, associations, and district councils continue to be constrained by collective action and political incentive problems. Local government leaders, on the other hand, have wielded historically strong formal and informal powers and stand, for better or worse, at the gateway to local policy reform. Motivated by direct elections and prospective donor funding, some district heads have become catalysts for better governance by introducing informal public-private dialogues, innovative monitoring instruments, and meritocratic promotion schemes. In response to current development debates, these findings highlight the importance of government leadership as an often underestimated policy determinant that can compensate for weak societal checks in periods of transition from authoritarian rule.

Christian von Luebke is completing a book manuscript titled “Heterodox Governance: The Political Economy of Local Policy Reform in Post-Suharto Indonesia.”  He has been awarded a 2009-2011 German Science Foundation Fellowship for a follow-up project incorporating cases from the rest of Southeast Asia and China.  In 2001-2006 he worked in rural Indonesia as a technical advisor for the World Bank and the German Development Agency. He holds a Ph.D. in public policy from the Crawford School of Economics and Government at the Australian National University.

Nathan Nunn is an Assistant Professor of Economics at Harvard University. Professor Nunn was born in Canada, where he received his PhD from the University of Toronto in 2005. Professor Nunn’s primary research interests are in international trade, economic development, and economic history. He is an Associate editor of the Journal of International Economics and an NBER Faculty Research Fellow.

One stream of Nunn’s research focuses on the relationship between historic events and current economic performance within Africa. In “Historical Legacies: A Model Linking Africa’s Past to its Current Underdevelopment”, published in the Journal of Development Economics in 2007, Nunn develops a game-theoretic model showing how the slave trade and colonial rule could have had permanent long-term effects on economic performance. In “The Long-Term Effects of Africa’s Slave Trades” (Quarterly Journal of Economics, 2008), Nunn documents the long-term adverse economic effects of Africa’s slave trades.

A second stream of Professor Nunn’s research focuses on the importance of hold-up and incomplete contracting in international trade. He has published research showing that a country’s ability to enforce written contracts is a key determinant of comparative advantage (“Relationship-Specificity, Incomplete Contracts and the Pattern of Trade”, Quarterly Journal of Economics, 2007).

Summary of talk:

In his presentation "The Slave Trade and the Origins of Mistrust in Africa", Nathan Nunn offers an empirical investigation into the relationship between Africa's Slave Trade (1400 to 1900) and its culture of mistrust today. The project is an individual-level analysis of whether members of heavily enslaved ethnic groups in Africa display lower levels of trust today. The underlying argument posits that the slave trade created a culture of "enslave or be enslaved", where a non-trivial proportion of slaves were actually tricked and sold off into slavery by their own friends or family members. These conditions left a legacy of mistrust that has persisted to this day.

The empirical analysis relies on estimates of slave flows and records of slaves' ethnic membership. It also relies on 2003 Afrobarometer survey data to measure individual attitudes of trust toward neighbors, family members, local councilmen and co-ethnics in 17 sub-Saharan African countries. The results indicate a negative effect of Africa's slave trade on individual levels of trust: ethnic groups most affected by the slave trade are most likely to be distrusting today. The results further show that this occurs not through the effect the slave trade had on the locality in which the individual currently resides, but rather through the effect the slave trade had on that individual's ethnic ancestors.

» Paper: "The Slave Trade and the Origins of Mistrust in Africa" (pdf)

Human Resource Management (HRM) is a core element of any organization.  This is especially true in public service organizations whose employees are often their most valuable resource. As an employee in a Japanese local government, Ichinomoto attempts to analyze the current problems in the personnel system that are severely criticized, to find a solution on how to develop more motivated government employees to provide efficient and customer satisfactory public service.

Mari Ichinomoto is a corporate affiliate visiting fellow at Shorenstein APARC for 2007-08 and 2008-09. She is also an official of the Industrial Recruitment and Location Division, Kumamoto Prefectural Government in Japan, with a mission to promote overseas direct investment into the country. Prior to this position, she was sent to Kumamoto trade promotion office in Singapore as a representative of the Kumamoto Prefectural Government dealing with trade promotion between Asia and Kumamoto. She graduated in foreign studies from Kitakyushu University.

Scott Rozelle is the Helen F. Farnsworth Senior Fellow in the Freeman Spogli Institute for International Studies. Dr. Rozelle received his BS from the University of California, Berkeley; and his MS and PhD from Cornell University. Before arriving at Stanford, Rozelle was a professor at the University of California, Davis (1998-2000) and an assistant professor in the Food Research Institute and Department of Economics at Stanford University (1990-98). Currently, he is a member of the American Economics Association, the American Agricultural Economics Association, the International Association for Agricultural Economists, the Asian Studies Association, and the Association of Comparative Economics. He also serves on the editorial board of Economic Development and Cultural Change, Agricultural Economics, Contemporary Economic Policy, China Journal, and the China Economic Review.

Dr. Rozelle's research focuses almost exclusively on China and is concerned with three general themes: a) agricultural policy, including the supply, demand, and trade in agricultural projects; b) the emergence and evolution of markets and other economic institutions in the transition process and their implications for equity and efficiency; and c) the economics of poverty and inequality.

In the past several years, Dr. Rozelle's papers have been published in top academic journals, including Science, Nature, American Economic Review, and the Journal of Economic Literature. He is fluent in Chinese and has established a research program in which he has close working ties with several Chinese collaborators and policymakers. He is the chair of the International Advisory Board of the Center for Chinese Agricultural Policy; a co-director of the Agricultural Issues Center (University of California); and a member of Stanford's new Food, Security, and the Environment Program.

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