YouSaid · the spoken record

Nicholas Bloom

lines on the record: 71
first: 2020-08-12
most recent: 2020-08-12
sittings or episodes: 1
sources: podcast

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“Go to their website, look them up for half an hour 20 minutes beforehand, and really try and learn about what they work on. It takes a lot of time. I find it really valuable. And that's the great source of ideas. So I'm personally also suffering in the sense of productivity. As I mentioned, I think the U.S. economy is from working at home full-time because those one-on-one meetings have stopped. And my own production function in some ways of continuing current projects is fine. I can do that. But I do feel that if this carries on for another year, I feel like the US economy are going to suffer a little bit in terms of struggling to come up with new ideas because there's not so much one-on-one discussion. I'm not randomly meeting people. So I can easily zoom current people I know on or, but it's much harder to come up with random people at seminars. You would have gone to, but clearly aren't.”
2020-08-12 · Conversations with Tyler · Nicholas Bloom on Management, Productivity, and Scientific Progress · IDENTIFIED FROM THE TRANSCRIPT · source
“That's hard to say. My best guess is, as you said, the other thing that's really helpful for me is working with co-authors will be some, you know, bright sparky co-author grad student would suggest we should look at X and maybe they're not that interested in it. I said, no, that's a great idea. And, you know, maybe at some point it turns into a collaboration. Often I'm giving a seminar a lot of great ideas come from just, you know, just for those of you that don't go on the academic seminar, the way that academic seminars work is, you know, because at GMU not that long ago, but you go and give a talk and then normally you get meetings in the morning and the afternoon. So a classic day would be you turn up at 10 a.m. You have half our meetings and then the lunch and there's a talk in the afternoon and then dinner. And what I really like is those one-on-one meetings because you're talking to lots of people for half an hour. And I find them mentally, really tariing because you're like fully on. And I actually, whenever I meet people,”
2020-08-12 · Conversations with Tyler · Nicholas Bloom on Management, Productivity, and Scientific Progress · IDENTIFIED FROM THE TRANSCRIPT · source
“I mean, for me, I really like to read broadly rather than deeply. It sounds an odd thing to say, but every Monday, for example, or Sunday night, the National Bureau of Economic Research has their vast email of all the recent papers. I tend to try and scan every title and abstract. I read the papers. I like the economist in the Economist magazine. It's good. It's kind of often been a source of ideas, actually. We were talking before the call. I listened to your podcast. I actually listened to a lot of podcasts because I try and go out for a walk or a run for about an hour every day. mostly listen to podcasts. I would say, well, if I'm getting too tired, I have to switch on to music. But yeah, I think for me that's been helpful for coming up with new research ideas.”
2020-08-12 · Conversations with Tyler · Nicholas Bloom on Management, Productivity, and Scientific Progress · IDENTIFIED FROM THE TRANSCRIPT · source
“As we get older and older, it feels like her adjustment costs become higher and higher. You know, I have these three areas I'm working on, I guess, innovation. I started working on management and uncertainty. The two I guess I started working more recently. I mean, innovation just, again, this is a random thing years. I mean, I don't know how long ago it was. I had a summer internship, an unpaid internship. It's a ministry long gone in the UK called the Department of Trade and Industry to do a project looking at patents. I mean, it's just like 30 years ago and I remember pulling up all the data on patents and that kind of interest innovation stuck. I tend to think I built up so much knowledge and interest in particularly management and uncertainty innovation. I tend to mostly focus on that. Although recently”
2020-08-12 · Conversations with Tyler · Nicholas Bloom on Management, Productivity, and Scientific Progress · IDENTIFIED FROM THE TRANSCRIPT · source
“What it was, but the other day I was talking to someone about something to do with management and talking about how it's a big issue of adjustment. Because that's right, I was thinking about working from home. So just to be clear, under COVID with social distancing working from home, I think this is going to last for another, let's say a year. It's hard to know if after a year more we are still social distancing and working home. We've been in that regime for up to 18 months. And a lot of firms are going to have adjusted individuals to that process. And, you know, you can call it inertia. You can also think of it as adjustment costs. But this is why I think a lot of what's happening now is going to stick because of that. And yes, in some senses, that has colored my thinking.”
2020-08-12 · Conversations with Tyler · Nicholas Bloom on Management, Productivity, and Scientific Progress · IDENTIFIED FROM THE TRANSCRIPT · source
“Yeah, you know, this kind of, it's like my first academic love was adjustment cost. In fact, it seems strange to say that. I remember Bob Hall saying he went to some NBR event and saying there was a huge shouting match about adjustment costs. And he said, how can anyone get so excited about some famous folks on adjustment costs? But he was kind of funny. How can anyone get so animated and excited about something so boring? And, you know, Bob and I and many others have worked in it. I got really interested. I realized halfway through my PhD it was hard to excite other people about adjustment costs. I'd honestly start talking to people again, coming back to the public economics thing. My friends in particular about it and their eyes would start, eyelids would start drooping. They were just boring into tears. And that's how I kind of ended up more morphing to look at uncertainty. Because I realized if you have high adjustment costs as in it's expensive to hire someone and far or invest in disinvest, uncertainty is really costly because you can't change your mind. But yeah, it has colored my thinking a lot. I was trying to think of there's some I'm blanking.”
2020-08-12 · Conversations with Tyler · Nicholas Bloom on Management, Productivity, and Scientific Progress · IDENTIFIED FROM THE TRANSCRIPT · source
“And then suddenly, of course, 0809 happened, and then COVID. So, in hindsight, I wouldn't advise that path. The issue is, you know, it's like first and second order stochastic dominance. It's on average the path I took was probably a less good path to take. It turned out for me individually due to circumstance and good luck, it worked out well.”
2020-08-12 · Conversations with Tyler · Nicholas Bloom on Management, Productivity, and Scientific Progress · IDENTIFIED FROM THE TRANSCRIPT · source
“I was clearly very lucky, so I wouldn't advise probably my certainly going to work in McKinsey as in leaving your PhD and going to a non-academic job, you know, on average is not a good path. I was just extremely fortunate that I managed to get back into academia after us. I wasn't there for that long for under two years. And I was fortunate the people I worked before were running a research center. So John Van Rena in particular, the CEP took me back as what's called a research officer. I mean, I was like a kind of souped up RA. And then I started working on two areas. One is management and one was uncertainty. And the management one turned out to be a fertile area to look in just because there was not much data. And uncertainty, I honestly was again fortunate on timing because when I started to look in it, it was during the period of the great moderation. So when I was working on uncertainty, I was looking at things like 9-11 as an enormous uncertainty shock, started to get into the topic. But, you know, business cycles were kind of quiet. People weren't working on that that much.”
2020-08-12 · Conversations with Tyler · Nicholas Bloom on Management, Productivity, and Scientific Progress · IDENTIFIED FROM THE TRANSCRIPT · source
“More dominant now, but so I just basically focused on data, and I was lucky at the RFS I could do a part time PhD just to be clear. When I started there, I was not a PhD student and I had a program encouraging people to go do part-time PhDs at UCL. So from there, I then went to start my PhD about nine months after joining the RFS at UCL. So I was oddly kind of an accidental PhD student. It was not something I ever had in mind.”
2020-08-12 · Conversations with Tyler · Nicholas Bloom on Management, Productivity, and Scientific Progress · IDENTIFIED FROM THE TRANSCRIPT · source
“Yeah, the IFS was great. When I finished my, I did a master's at Oxford. I wasn't intending to go into research at all, actually. I applied for a lot of investment banks and other, I applied for IT jobs. I mean, I remember getting an offer from BZW now kind of long closed British investment bank to go work in that IT department and thought it very seriously so, you know, all over the place. I took this job at the RFS. turned out to be fantastic. One has it really inspired me to get interest in economics. They answered what I would call pub economics questions. So what I mean is in the British sense, they're questions you can talk to your friends in the pub about, which are the same ones, frankly, that, you know, the New York Times or anyone, they're kind of not obstrue things like what happens in this model when alpha goes to seven, but more like, how would you know, increase growth rates? So the RFS was very much about inspiring me to do this stuff. And it's also entirely empirically focused. So again, that was in an era where empirical economics wasn't so dominant.”
2020-08-12 · Conversations with Tyler · Nicholas Bloom on Management, Productivity, and Scientific Progress · IDENTIFIED FROM THE TRANSCRIPT · source
“Think the question to ask is what's the value added? So remember, the top five schools recruit by far the best students. They just, I know Stanford ranks the students and we tend to get those. We make offers to those at the top of the list and we do pretty well out of that. We typically get pipped by MIT. So the question is, what's the value added? And it's never been obvious to me what that is. I suspect it's positive, but I'm not certain. And it's definitely not uniformly positive for me. almost certainly it was a better off having gone to ucl was a fantastic outcome for me versus anywhere else and because i got to work with all these people early on i was also i just say very lucky because the ifs at that era was big into what they called microconometrics which is basically using panel data which turned out to be exactly the way to go so i was kind of fortunate i mean i was clearly fortunate i just happened to be in a university that was on the rise at the time”
2020-08-12 · Conversations with Tyler · Nicholas Bloom on Management, Productivity, and Scientific Progress · IDENTIFIED FROM THE TRANSCRIPT · source
“For me doing my PhD at UC, I was extremely fortunate. Oddly enough, I've had this discussion with a lot of people that are applying to Stanford as PhD students. I'm not sure if I effectively sells or undersells Stanford, but this trade-offs when thinking about grad school. It's true if you go to an elite grad school, you're surrounded by a fantastic cohort and have great faculty. On the other hand, it's hard to work often with a faculty because there's so many other good students around. At the time, I was at UCL, I was doing my PhD.”
2020-08-12 · Conversations with Tyler · Nicholas Bloom on Management, Productivity, and Scientific Progress · IDENTIFIED FROM THE TRANSCRIPT · source
“For another six to nine months is going to be much more discontentment. In fact, I saw that in China when we did the sea trip study, people were working from home for nine months. And towards the end of it, it started to really grind and drag on. That was more about loneliness, but the other issue is in terms of being productive and being creative.”
2020-08-12 · Conversations with Tyler · Nicholas Bloom on Management, Productivity, and Scientific Progress · IDENTIFIED FROM THE TRANSCRIPT · source
“Okay, so let's take Ivan and Zauji Lim from Ohio State University. I first met them physically. I went to give her a seminar at Ohio State University. I sat in Zaoji's office for half an hour. We kind of got excited about a research idea. That was the critical meeting point. I'm not sure what would have happened if we'd done it remotely. And after talking to him, I thought this guy seems great. It's a really interesting idea. He continued to communicate by email. So my thought is, and it kind of matches roughly what a lot of Silicon Valley types say, is the initial spark or idea is much more effectively generated in person. Often it's over lunch or over coffee. So this is the sense in which productivity now, so I've been a running masses of surveys under working from home to try and get the sense of how people are feeling. And both firms and workers are overwhelmingly positive about working from home. But that's now, I mean, again, to be clear, that's July and we're kind of three to four months into the lockdown. My fear is if it were full-time working from five days a week.”
2020-08-12 · Conversations with Tyler · Nicholas Bloom on Management, Productivity, and Scientific Progress · IDENTIFIED FROM THE TRANSCRIPT · source
“You know, my co-authors are just all over the place. I was going to say, one of the things I really miss about Working Home is going to seminars and conferences, in particular kind of, you know, the two last conferences I went to before lockdown. One was in Mexico, Itam, and one was in Melbourne at Monash University. They're both fantastic because they were small. And I got to basically talk to everyone there. And that's the kind of thing that generates for me co-authors, talking to someone of the quirky idea that comes up with something. Oddly enough, most of my co-authors are not at Stanford, which seems to disobey my own rule. I don't know why that is. Mostly I have overlap with them physically at one point or another. They're former students or former colleagues like when I was at the UCL or LSE. Steve Davis, I work with a lot and it's at Chicago. I never physically overlap with him. You know, two are they like Ivan Alfaraz, Augi Lynn. I met them at Ohio State University.”
2020-08-12 · Conversations with Tyler · Nicholas Bloom on Management, Productivity, and Scientific Progress · IDENTIFIED FROM THE TRANSCRIPT · source
“About he wanted people to be in the office. You have to be there for the new ideas come up from water cooler discussions and meetings on one-on-one stuff. And obviously under COVID, that's all stooled. So none of that will really show up right now. You know, you can get away with three to six, maybe even nine months, probably have not radically creating new things. But in the long run, I fear there'll be a drop in, say, patenting in 2021, 2022 because of this. The question is how firms respond. My guess is from talking to a lot of US companies is they will return partly to the office. So I think in the long run, working from home will be fine because we'll be in the office three days a week and two days a week at home. So that's kind of the best of both worlds. I don't think you need to be in the office five days a week to be creative, but you do need sometime each week with colleagues. I'm not too worried now. What I think will be problematic is if we're in late 2021, we were still all 100% working from home. Then I would really worry about impacts and productivity.”
2020-08-12 · Conversations with Tyler · Nicholas Bloom on Management, Productivity, and Scientific Progress · IDENTIFIED FROM THE TRANSCRIPT · source
“Great question. Just to be clear, my thoughts on work environment. In the short run, working from home, for those of us that can, so just to be clear, only something like 40% of Americans can work from home. But for those, but that accounts for something like 50-60% of GDP because they tend to be higher earning individuals. So for those of us that can work from home, the evidence looks like in the short run, that increases productivity as long as you've got reasonable conditions, like proper internet and a room, your own exclusive room to work in. The big question, you know, that's research I've been, you know, I had an old paper looking in China and we showed very large increases in what I call short-run productivity from people working in call centers. The big unknown in which there's evidence I'm working on, I know other people are looking at this too, which is what's the impact on longer run productivity, which the concept I've come back to beginning of the podcast is about kind of creation and innovation. So lots of claims, including Steve Jobs before he passed away, made several comments.”
2020-08-12 · Conversations with Tyler · Nicholas Bloom on Management, Productivity, and Scientific Progress · IDENTIFIED FROM THE TRANSCRIPT · source
“I don't see in the evidence I've seen since the 60s as a period of particularly high policy uncertainty. So you're right, those incidents happened, but in other areas like domestic economic policy, again, I'm going off newspapers, but on average in stock market reactions, it doesn't seem to be pretty particularly high. I mean, the two great spikes in the stock market, volatility, by the way, in the 60s with the Cuban missile crisis and the assassination of JFK.”
2020-08-12 · Conversations with Tyler · Nicholas Bloom on Management, Productivity, and Scientific Progress · IDENTIFIED FROM THE TRANSCRIPT · source
“You know, this is why long run measures are actually useful. It's very hard when you talk to people, they often raise different eras as particularly more or less uncertain. And often it's driven by, you know, their own personal experiences. And there's actually a phenomena. I mean, it's interesting you raised the 60s. It's actually a phenomenon to think the past was more certain than the present because you see the past having happened. You forget all the alternative scenarios that could have been. So just on data, the 60s in terms of stock market volatility were quite low in terms of macro volatility were moderately low. There was the whole great moderation. And the 1780s were very volatile in macro growth, but the 60s were reasonably calm. In terms of our index, economic policy uncertainty index, where he scraped newspapers, it didn't appear to be particularly high levels of uncertainty. So you could argue newspapers, you know, in that era, it wasn't clear how completely open they were. Watergate was kind of opening the floodgates of being more transparent.”
2020-08-12 · Conversations with Tyler · Nicholas Bloom on Management, Productivity, and Scientific Progress · IDENTIFIED FROM THE TRANSCRIPT · source
“Yes, but the stock market does not reflect the US economy. The stock market, for example, right now is 30% high tech, which is only 7% of US jobs. And also when interest rates drop because the economy slows, it makes the stock market go up because it's suddenly a relatively better investment. So I think it's stock market and the state of the US economy are only weakly linked.”
2020-08-12 · Conversations with Tyler · Nicholas Bloom on Management, Productivity, and Scientific Progress · IDENTIFIED FROM THE TRANSCRIPT · source
“Was considerable policy uncertainty because things like the debt ceiling debate in the fiscal cliff, and who you blame is less obvious there. So Congress was fighting. The president, Obama, wanted to pass various pieces of legislation, couldn't. The same thing is true now, of course. We have a mixed control of Congress. I think Trump made it a lot worse. Default him quite explicitly. He just changed his mind and he also didn't listen to advisors. So when he talked to firms, it's very hard to predict which way policy was going to go because a lot of decisions didn't seem entirely thought out, rational, predictable. I don't know what words you use, but firms who complain about we didn't see this coming. And, you know, he changed his mind on tweets. And that, by the way, U.S. physical investment even before COVID was not great.”
2020-08-12 · Conversations with Tyler · Nicholas Bloom on Management, Productivity, and Scientific Progress · IDENTIFIED FROM THE TRANSCRIPT · source
“Yeah, Donald Trump, in terms of economic performance, how would you assess it before COVID, he was fine. You could always be slightly, I mean, again, I'm not a Trump supporter, so definitely do get me wrong. You could be mildly positive on it and saying, look, he took the Obama boom and continued it. And as expansions go on, maybe think it's harder and harder to keep that expansion going. Growth didn't pick up, but it also didn't slow down under Trump. So that would be a passing grade. It wouldn't be fantastic. It wouldn't be terrible either. One thing that aided growth under Trump was the corporate tax cuts. There's another political uncertainty in changing his mind all the time. And honestly, a lot of bad policy reduced growth under Trump. It seems to netted out to about zero. It was no higher or no lower than in Obama's second term. So the policy uncertainty was a negative, but there are other things he did that were positive. It's also true that under Obama,”
2020-08-12 · Conversations with Tyler · Nicholas Bloom on Management, Productivity, and Scientific Progress · IDENTIFIED FROM THE TRANSCRIPT · source
“This stuff, but just in terms of the ground, technology has improved attendance at sports games because of this we can stamp it out. And that's something that doesn't show up in productivity figures. So another concern you could have, and there's being a big debate in terms of productivity, is it the case that the quality of life has risen in ways that we're not measuring it? I could get into that debate. I think the answer is primarily no, but you could make that claim. And hooliganism has been pushed back a lot by technology.”
2020-08-12 · Conversations with Tyler · Nicholas Bloom on Management, Productivity, and Scientific Progress · IDENTIFIED FROM THE TRANSCRIPT · source
“You know about the famous old firm rivalry, Celtic Rangers, you probably think, no, the two Glasswegian teams. Again, I know in Scotland I really spent a vast amount of my time in Glasgow. I don't think it's, I wasn't expecting Tyler, I think, to be asked about Scottish football hooliganism, but as far as I'm aware, no. I mean, the interesting thing, by the way, on technology, one of the issues that afflicted the UK was hooliganism. And, you know, there's kind of various elements of it, but one was just, you know, fighting and violence, but another one was racism. And both of them technology has been fantastic at combating just on, you know, on both of them, cameras in the ground, ID cards, online. There was an incident just over the weekend. I was looking just this morning about the racial comments made against a crystal palace football player that the police check through online and turned out to be a 12-year-old boy in the west of Midlands.”
2020-08-12 · Conversations with Tyler · Nicholas Bloom on Management, Productivity, and Scientific Progress · IDENTIFIED FROM THE TRANSCRIPT · source
“On the pandemic, I'm not enough up to the news on England versus Scotland living in the US to give more of an answer, but I am aware that Scots have done better on that and they certainly did better on Brexit.”
2020-08-12 · Conversations with Tyler · Nicholas Bloom on Management, Productivity, and Scientific Progress · IDENTIFIED FROM THE TRANSCRIPT · source
“It's an interesting point. The Scots also voted what I would say is the right way on Brexit. They're against Brexit. I mean, I'm going to let, you know, be very open here. I was against Brexit because Britain leaving the European Union, I think, is bad economically for the UK. And I think it's kind of this whole concept of being a little England looking inwards. Scotland voted against Brexit quite resoundingly. And it's true that they've handled the pandemic much better. Why that is, it's not clear. I mean, I regularly talk to my mother-in-law in Scotland. In some ways, they seem to be more educated and at least as far as I'd sit in the way they vote. Their OECD measured levels of education are not higher. I'm not aware of any other striking differences. I think I like Nicholas Sturgeon, who is the I think is what's called the first minister. She's effectively the Prime Minister of Scotland. She's done a very good job. She locked down faster in Scotland. I think that's why they dealt with the pandemic sooner. Again,”
2020-08-12 · Conversations with Tyler · Nicholas Bloom on Management, Productivity, and Scientific Progress · IDENTIFIED FROM THE TRANSCRIPT · source
“My mom is Scottish, so I don't think they're that different actually. I mean, having now lived in the US, even the US, UK difference, I don't think is enormous. Increasingly, as I travel around the world, you realize that there are huge differences between northern and southern Europe that strikes me as quite striking, actually. England and Scotland are very similar. We effectively have the same legal system, the same educational standards. My mother-in-law, who's in Glasgow, I should send her this podcast will probably kill me for saying that, but you know. The Scots, I should point out, have had some of the most successful, you know, members of British kind of British government like Gordon Brown and various prime ministers. They've over-represented, but I don't think they're very different. I think, in fact, in reverse, they're really pretty similar.”
2020-08-12 · Conversations with Tyler · Nicholas Bloom on Management, Productivity, and Scientific Progress · IDENTIFIED FROM THE TRANSCRIPT · source
“The best managers to run the place, and of course, as I get bigger and bigger, I'm running out of good family members. So do I appoint a second cousin or that pretty incompetent younger son of mine? And, you know, you can imagine the trade-offs going on, but it means that unless you have a proper legal system, which generates trust, it's very hard to grow large firms without professional managers.”
2020-08-12 · Conversations with Tyler · Nicholas Bloom on Management, Productivity, and Scientific Progress · IDENTIFIED FROM THE TRANSCRIPT · source
“In terms of trust, are some of the African countries whereby the legal systems in chaos because they're undergoing civil war and the highest countries are like Norway, Sweden, North America. So currently in China, the rule of law is applied to commercial contracts, I think is reasonable. I'm not an expert, but you don't hear endless stories of scandals and corruption, at least as commercial contracts go. And I think that's what enables these large firms to grow. When we've collected survey evidence, you know, in reverse, we definitely don't hear endless stories of managers ripping off firms and stealing ideas, which is a big problem. So just to reverse it around, what happens in countries with very weak legal systems where you can't trust anyone is you hire your family members. So if I own a sapper company and I can't trust any outsiders, I start to stuff it full of sons, daughters, brothers, brothers-in-laws, sisters, sisters-in-laws, aunts, uncles, et cetera. Now, that's good because I can trust them. But the problem is, you know, these people aren't natural.”
2020-08-12 · Conversations with Tyler · Nicholas Bloom on Management, Productivity, and Scientific Progress · IDENTIFIED FROM THE TRANSCRIPT · source
“A lot of Charles, I think, derives from rule of law. And so in China, again, I mean, this is getting sensitive into politics, but there's rule of law around political system, which I really don't want to comment on, but there's rule of law around things like contractual enforcement, which turns out to be important for trust between firms. So, you know, if you tile a cow and set up a company and give me a contract for three years for providing ball bearings, I'm going to go and put a bit of money into R&D and improving them set up a process. If you then, you know, say after six months I've changed my mind, can I sue you and get the money back? And if I can effectively do it through the court system, I can trust you. So that's maybe a kind of odd concept of trust.”
2020-08-12 · Conversations with Tyler · Nicholas Bloom on Management, Productivity, and Scientific Progress · IDENTIFIED FROM THE TRANSCRIPT · source
“It's much that's harder to evaluate, but typically, if you want to look for well-run companies, you know, its size levels, high levels of competition are open to trade, educated employees, no family firms where it's handed down by primogenitor, you know, the eldest son inherits it. Go into the sectors that don't have these issues, then you tend to see very good management. And China typically tick most of those boxes manufacturing.”
2020-08-12 · Conversations with Tyler · Nicholas Bloom on Management, Productivity, and Scientific Progress · IDENTIFIED FROM THE TRANSCRIPT · source
“Chinese management has, you know, I don't have fantastic recent data. So I'll give you my best data. We surveyed them last on at scale in 2005. At that point, they were roughly in line with GDP. They were okay. They weren't fantastic. I've had some other surveys that are not internationally comparable more recently. They're pretty good. I have to say in manufacturing, a lot of what drives good management practices is being large, being around for a while, being open to competition. China has and having educated employers and China has those inputs. So a lot of their manufacturing firms in particular are big. They're competing ferociously with other companies. They actually, China's education systems are churning out vast numbers of engineers. And they've been operating now for quite a while. I suspect that at this point now, Chinese manufacturing management is pretty good, actually. It's harder to tell in other sectors, particularly those that are not internationally comparable. They're financial services. Who knows?”
2020-08-12 · Conversations with Tyler · Nicholas Bloom on Management, Productivity, and Scientific Progress · IDENTIFIED FROM THE TRANSCRIPT · source
“Six looms at the back row and have a quality defect index and have a quality control process, a Kaizan process. And after two to four weeks, it was so effective in spotting repeated issues that the factory owner said, this is great, it's worth the effort setting up this QDI index and this committee. We're just going to roll it out to the whole factory. But in advance, they were skeptical. So I think that's there with so many things in life. Unfortunately, we just don't know what we don't know. And so we're skeptical on advice.”
2020-08-12 · Conversations with Tyler · Nicholas Bloom on Management, Productivity, and Scientific Progress · IDENTIFIED FROM THE TRANSCRIPT · source
“Lot of this just is like Dallas's recommendations. I can't remember what she said, there's various things. That's it. She said you were using this microphone, turn the gain thing down to zero. I didn't realize that. And there was a knob at the back of the microphone I'd never even looked at. I then looked at it and saw, oh yeah, there is that. You know, turned it down to zero and hopefully it sounds okay. I think a lot of it is honesty. You see this in firms all the time. When we were out in India, when I was in McKinsey, you'd often give pieces of advice and ex post. It was really useful. So for example, just as another concrete piece of analysis when I was out in India, a big issue in a lot of modern management is quality defects. So we went, these companies were large companies making, say, fabric that goes into making shirts and trousers and upholstery coverings. And a lot of the learnings from coming out originally from Japan is you should, you know, zero in on quality defects and fix them instantly. So essentially said, look, your factory of 100 looms, we're going to take, you know.”
2020-08-12 · Conversations with Tyler · Nicholas Bloom on Management, Productivity, and Scientific Progress · IDENTIFIED FROM THE TRANSCRIPT · source
“Well, there's two issues. I think one is you've got to consider what would be like without it. So, you know, humanity is dramatically more productive than it was, and some of it could be self-help. The other issue is I think this unknown unknowns, the problem is you don't know what you don't know. And just again, as a personal anecdote, I always thought I was reasonably given the energy kind of energy efficiency in my brother came around, you know, before COVID and it was a couple of years ago and pointed out, look, I should be using LED bulbs throughout the entire house rather than the old halogen or CFL fluorescent ones. And, you know, my brother's an engineer and I kind of sat down and went through the numbers and it paid off within two to three years. And that's clearly a fantastic rate of return. And so pretty rapidly I switched out every single bulb in my house to LED. But, you know, I didn't know it until someone had pointed it out. Ex post, it seems kind of obvious. I could have easily gone to Amazon and worked out the cost of it, worked out the electricity usage and done the calculation. I just never thought of it.”
2020-08-12 · Conversations with Tyler · Nicholas Bloom on Management, Productivity, and Scientific Progress · IDENTIFIED FROM THE TRANSCRIPT · source
“Helpful. The issue is maybe on the evidence base, again, to, you know, as an economist, ideally, you'd have an RCT, how you'd execute, it's not obvious, but you may take a thousand Americans or a thousand Spaniards or something, some sample and then give 500 of them intensive self-help coaching for a month and see what happens. I mean, quite possibly somebody's done this. I don't, you know, it may exist, but that would be my way to evaluate these kind of interventions.”
2020-08-12 · Conversations with Tyler · Nicholas Bloom on Management, Productivity, and Scientific Progress · IDENTIFIED FROM THE TRANSCRIPT · source
“I'm not sure they're pretty. I don't know how I'd evaluate it. There is a large, you know, I can flip it around. I take the economist take. I'm going to kind of take your line on this, which is there is an enormous volume of like self-help books and podcasts and news reels, et cetera. And the fact that they exist means people are spending a lot of time reading them. And I presume if you assume that people are rational, it means they get value out of it. I actually find these things quite useful. I'm not sure I absorb most of the tips, but you know, I guess my mental model is, look, I listen to some. I mean, I don't tend to listen to South Half podcasts, but I read a lot and I read something that maybe 10 tips in there. In fact, before the podcast started, I was talking to Dallas, your producer, and she was, she'd sent me this whole list of things on what to do with your microphone and video. And I had read it all. In fact, she concluded a link and I went onto that. I found a couple of them really useful. I'd say 90% of them I'd seen, or maybe it wasn't applicable, but 10% were great. So I actually think there potentially are quite.”
2020-08-12 · Conversations with Tyler · Nicholas Bloom on Management, Productivity, and Scientific Progress · IDENTIFIED FROM THE TRANSCRIPT · source
“What we're trying to build, and I wouldn't say it's our research, but more our data that hopefully people use because it's publicly available data is to, you know, say, look, here are five hypotheses of management. Is this support in large-scale data? I think that would put more discipline and therefore put more credibility on these books.”
2020-08-12 · Conversations with Tyler · Nicholas Bloom on Management, Productivity, and Scientific Progress · IDENTIFIED FROM THE TRANSCRIPT · source
“Firm around, but they're not great for research, and the reason is I know from personal experience having to write one case study, I wrote a case study on a firm that was owned by someone that was in my Stanford MBA course called Golcodas, and it's called The Challenge of Change. And the problem was we wrote this case that it was a fascinating company that actually eventually got taken over by private equity in India. And they were huge, very successful apparel firm. But we had to get legal sign-off from everyone involved. So we interviewed six or seven people and they all had to legally sign off and say they were fine with used using the material. And you can imagine what that does for selection effects. It means that basically these books are very hard for them to get proper information on firms that do badly because they refuse lawsuits. So I think a lot of management research.”
2020-08-12 · Conversations with Tyler · Nicholas Bloom on Management, Productivity, and Scientific Progress · IDENTIFIED FROM THE TRANSCRIPT · source
“But yeah, Yeah, one issue that struck me while I got into management in the first place, just to explain what I've been doing for years. I've been working with a huge coalition of people. So I mentioned Rafael Lissadin, John Bonrein and Hanata Limos, Danielle Ska, Eric Winjolson, Lucia Foster. There's a huge group of us, Scott Olmacher, that have been trying to measure management practices across firms and countries. This very methodically, in some ways, very boringly running. We must have surveyed several million organizations by now to create a big data set. And we take populations of firms run these surveys, collect data, and compare them. Now, that was just, you know, most of the books that I read that are popular, good to great and built to last and things like this are generally based on individual anecdotes and case studies. And I think that's quite, I mean, it's great for teaching. I use case studies in Harvard Business Called Case Studies all the time to teach because it's very inspirational. But there were always positive stories of how, you know, Mrs. X or Mr. Y turned the”
2020-08-12 · Conversations with Tyler · Nicholas Bloom on Management, Productivity, and Scientific Progress · IDENTIFIED FROM THE TRANSCRIPT · source
“Yeah, I mean, there are great books, I'm sure. I don't mean to imply they're all terrible. I'm sure there are. I'm going to, you know,”
2020-08-12 · Conversations with Tyler · Nicholas Bloom on Management, Productivity, and Scientific Progress · IDENTIFIED FROM THE TRANSCRIPT · source
“Another book of manager. You know, I'm not a huge book reader. Having said that, I've been recently reading Hillbilly Elegy, which is fantastic, but I tend to, you know, it's oddly enough, I tend to be a huge reader of news, like, you know, the Times, the Wall Street Journal, the Economist, the FT. I'm trying to think management books. I'm sure as soon as the interview is over, I'll kick myself and think there was some fantastic book”
2020-08-12 · Conversations with Tyler · Nicholas Bloom on Management, Productivity, and Scientific Progress · IDENTIFIED FROM THE TRANSCRIPT · source
“Of management practice is improving every year. We're getting better at managing firms in the US. And below that frontier, there are countries that are closer, say, Northern Europe that are further, say, Southern Europe and even further below the developing world. And they're improving too. It's just there's a big gap and it takes time. It's like innovation. It takes time for it to diffuse. And a better legal system would accelerate that. If you could have, you know, ruthless private equity backed by tough laws. I think it would be, you know, that would be painful economically and socially, but the growth rate would improve because you'd have much more transfer of management practices.”
2020-08-12 · Conversations with Tyler · Nicholas Bloom on Management, Productivity, and Scientific Progress · IDENTIFIED FROM THE TRANSCRIPT · source
“Okay, I was going to say, well, one solution you'd think for, you know, I mean, I use India, but it's basically all developing countries, and including honestly large parts of Southern Europe is private equity. So look, you see all these badly run firms. Why doesn't PE come in, buy up firms and turn them around? The problem is the legal environment is not great. So I remember talking to someone that said it was Blackstone came in a big P firm, bought a large retailer, sorry, a large apparel manufacturer in India and really struggled because sure they can improve management practices, but profit wasn't going up. And there was a lot of money basically illegally leaking out of the company. And because the legal system was weak, it was hard to turn this around. So then you're right. The alternative, look, even if private equity doesn't come in, why can't they do it organically? And they are. So to be clear, management practice in India, which I know best have been improving over time, there are some very successful Indian multinationals like Tata and Alliance. The issue is that isn't scaling. If you think of it, the front.”
2020-08-12 · Conversations with Tyler · Nicholas Bloom on Management, Productivity, and Scientific Progress · IDENTIFIED FROM THE TRANSCRIPT · source
“Yes, a great question. I've long thought about this. I think the biggest, one of the major constraints India and Novasca just been out there a lot. And one of the huge constraints is the legal system. So it sounds odd, but I'll just go through it. So in India, you know, the actual law, as it's written down in the statute book, is good. There's no obvious issues with it, at least as people I talk to. But the big constraint is processing cases through the courts. So the courts are dramatically undersupplied in terms of judges. And so what happens is it's very slow to process cases through court. As a result, when you talk to Indian firms, they're very skeptical of taking any issues through the court system. So just to be clear, if you're in the US and you're a manager and you discover somebody stealing stuff from you, you're pretty likely to report it to the police. And then it goes to the court system, that manager faces potential prison. They clearly lose their job. They have a big loss of career earnings. So in the first place, they probably...”
2020-08-12 · Conversations with Tyler · Nicholas Bloom on Management, Productivity, and Scientific Progress · IDENTIFIED FROM THE TRANSCRIPT · source
“Think of the way consultants are operating in the 90s, 2000s, it isn't obvious to many firms that Lean was a far better way to run your factory, that you really want to introduce these Kaizen production process, et cetera. And consultants come in and help you adopt them. And it's not just factories. healthcare. So there's been a huge transformation in lean health whereby when you go in and see a doctor, you really, really don't want there to be process mistakes. And lean is actually very good at reducing quality defects and improving productivity. So that's the area where consultants are great. I remember when I was at McKinsey and one of the projects I did with a retailer, we had someone that used to work at Toyota. And this Toyota guy had been there for three, four years and was just fantastic. He went around the retailer and said, you know, here's the kind of tools we use in Toyota and just applied them. And it was an extremely valuable. So that's the positive side of Managing Consulting, highlighting things that maybe ex post after the event are obvious why it works, but in advance, you know, just aren't.”
2020-08-12 · Conversations with Tyler · Nicholas Bloom on Management, Productivity, and Scientific Progress · IDENTIFIED FROM THE TRANSCRIPT · source
“Partly, we were there to bolster evidence. The third element, I think, is generally useful, and I've seen this, you know. Then back in history after World War II, the big movement in the US was what's called mass production. So Henry Ford had the production line. And the idea was he just scale up, get bigger and bigger and bigger and make more and more Fords and roll it off in a massive factory setup. Toyota and the Japanese car manufacturing sector at that time in the 1950s because they're obviously so devastated by the war didn't have access to capital and had to produce things on a small scale. And they went for an alternative system called Lean. And the whole idea of lean is that you try and spot mistakes and immediately, you know, stop the line. It's very painful in the slow run. If you see a problem in the car, you stop it, you go through it, you figure out, and then you restart. And it takes time to start off and it's a slow burn. But by the 1980s, the Japanese car factories were clearly starting to dominate. They had lower costs and higher quality. In fact, there's a great MIT book called The Machine That Changed the World that documents that.”
2020-08-12 · Conversations with Tyler · Nicholas Bloom on Management, Productivity, and Scientific Progress · IDENTIFIED FROM THE TRANSCRIPT · source
“You know, I don't know if everyone knows, but I worked at McKinsey for about a year and a half. So, you know, I should state that I no longer work for them. I don't take any money for them anymore. I mean, that was a long time ago. That's almost 20 years ago. But just from that and from my research, you know, there's two or three things they do. I mean, it is true on the negatives. To start with the negative side, the critique that's often thrown at them is they either tell you the obvious, you know, they ask to bore your watch and tell you the time or they tell you things that the CEO normally knew, but she or he basically didn't want to fess up to tell the workers. And it is true that I felt there are some element of that that, you know, there was one project in particular when I was involved in, I remember it seemed to us to be reasonably clear what to do. I think it seemed to be reasonably clear to the division ahead what to do, but it was hard for her to tell the whole group and, you know, McKinsey came in. The project was highly successful. The division improved dramatically, but it was.”
2020-08-12 · Conversations with Tyler · Nicholas Bloom on Management, Productivity, and Scientific Progress · IDENTIFIED FROM THE TRANSCRIPT · source
“I mean, Italy is just a productivity basket case. When I talk to, you know, Rafael Sedun, for example, my long-term co-author, when I talked to her about Italian productivity, I mean, a lot of the issues you hear about regulations, you know, political instability, challenges of the education system, migration. I mean, another thing for Italy, it's even more so for Greece, actually, is that a lot of southern Europe has suffered from a large negative brain drain. I know lots of highly able Italians, but they basically tend to, you know, many of them I know that are in the US and the UK. And they've left the country because it's poor economic prospects. Italy is almost the laundry list of what's gone wrong and what not to do. But I think a lot of it comes down to poor government that then feeds through into all these policies that make it hard for firms to innovate. Italy's R&D performances isn't great. It's very uncertain. It drives a lot of people abroad. The education systems pool.”
2020-08-12 · Conversations with Tyler · Nicholas Bloom on Management, Productivity, and Scientific Progress · IDENTIFIED FROM THE TRANSCRIPT · source
“Localized electric motors, which is a large flat building. So that explains if you look at really old fashioned factories and like the center of Manhattan and places where they were built 200 years ago, they're very tall buildings. Modern factories are low-slung, massive sheds. But of course, when electricity came in, it's very hard to reshape all those buildings. And it takes decades. And it's kind of like that with reshaping the management organizational structures of society. I think that's one reason why it's taken so long for IT to affect productivity.”
2020-08-12 · Conversations with Tyler · Nicholas Bloom on Management, Productivity, and Scientific Progress · IDENTIFIED FROM THE TRANSCRIPT · source