This paper introduces a new method for determining the impact of managers on team performance by randomly assigning them to teams and accounting for individual skills. Effective managers are shown to significantly improve team performance compared to workers. Surprisingly, self-nominated managers perform worse due to overconfidence, particularly in social skills. The study reveals that economic decision-making skill and fluid intelligence are better predictors of managerial success than gender, age, or ethnicity. The findings suggest that selecting managers based on skills rather than demographics or personal preferences could greatly enhance organizational productivity.
https://www.nber.org/papers/w32699