Nicholas Bloom

stanford · economics

A longstanding challenge in evaluating the impact of uncertainty on investment is obtaining measures of managers’ subjective uncertainty. We address this challenge by using a detailed survey measure of uncertainty collected by the U.S. Census Bureau for approximately 25,000 manufacturing plants. We find three key results. First, investment is negat...

Full days worked at home account for 28 percent of paid workdays among Americans 20–64 years old, as of mid-2023. That’s about four times the 2019 rate and ten times the rate in the mid-1990s. We first explain why the big shift to work from home has endured rather than reverting to prepandemic levels. We then consider how work-from-home rates vary...

We introduce a new measure of own-price inflation uncertainty using firm-level data from a large and representative survey of UK businesses. Inflation uncertainty has increased significantly since the start of 2021, even as a similar measure of sales uncertainty has declined. We also find large cross-sectional differences in inflation uncertainty,...

We quantify the commute time savings associated with work from home, drawing on data for 27 countries. The average daily time savings when working from home are 72 minutes in our sample. We estimate that work from home saved about two hours per week per worker in 2021 and 2022, and that it will save about one hour per week per worker after the pand...

Uncertainty rises in recessions and falls in booms. But what is the causal relationship? We construct cross-country panel data on stock market returns to proxy for first- and second-moment shocks and instrument these with natural disasters, terrorist attacks, and political shocks. Our IV regression results reveal a robust negative short-term impact...

We analyse the impact of Covid-19 on productivity using data from an innovative monthly firm survey that asks for quantitative impacts of Covid-19 on inputs and outputs. We find total factor productivity (TFP) fell by up to 6% during 2020-21. The overall impact combined large reductions in ‘within-firm’ productivity, with offsetting positive ‘betwe...

We examine several measures of uncertainty to make five points. First, equity market traders and executives at nonfinancial firms have shared similar assessments about one-year-ahead uncertainty since the pandemic struck. Both the one-year VIX and our survey-based measure of firm-level uncertainty at a one-year forecast horizon doubled at the onset...

Objective Satisfaction with healthcare may be captured by surveys of patients and staff, or in extreme cases, the number and severity of medical disputes. This study tries to investigate the relationship between satisfaction and hospital management as well as the role of good management in preventing medical disputes ex ante. Method We investigate...

Using confidential Census matched employer-employee earnings data we find that employees at more productive firms, and firms with more structured management practices, have substantially higher pay, both on average and across every percentile of the pay distribution. This pay-performance relationship is particularly strong amongst higher paid emplo...

Understanding how differences in management ‘best practices’ affect organizational outcomes has been a focus of both theoretical and empirical work in the fields of management, sociology, economics, and public policy. The World Management Survey (WMS) project was born almost two decades ago with the main goal of developing a new systematic measure...

Drawing on data from the firm-level Survey of Business Uncertainty, we present three pieces of evidence that COVID-19 is a persistent reallocation shock. First, rates of excess job and sales reallocation over 24-month periods (looking back 12 months and ahead 12 months) have risen sharply since the pandemic struck, especially for sales. Second, as...

We examine the text content of US patent applications, identifying those that advance technologies in support of video conferencing, telecommuting, remote interactivity, and working from home (collectively, WFH). The share of new patent applications that advance WFH technologies more than doubles from January to September of 2020, greatly surpassin...

In Bloom, Draca and Van Reenen (2016, “BDVR”) we have a set of nine results on the impact of Chinese trade. The first three showed that Chinese trade increased technical change in European firms measured by patents, productivity and IT adoption. The last six showed that Chinese trade led to reallocation towards more technologically advanced firms:...

What is the optimal form of firm organization during “bad times”? The greater turbulence following macro shocks may benefit decentralized firms because the value of local information increases (the “localist” view). On the other hand, the need to make tough decisions may favor centralized firms (the “centralist” view). Using two large micro dataset...

No previous infectious disease outbreak, including the Spanish Flu, has affected the stock market as forcefully as the COVID-19 pandemic. In fact, previous pandemics left only mild traces on the U.S. stock market. We use text-based methods to develop these points with respect to large daily stock market moves back to 1900 and with respect to overal...

We elicit subjective probability distributions from business executives about their own-firm outcomes at a one-year look-ahead horizon. In terms of question design, our key innovation is to let survey respondents freely select support points and probabilities in five-point distributions over future sales growth, employment, and investment. In terms...

After a recent increase in Chinese import competition, European firms increased innovation. We present and rationalise these patterns using “trapped factors” at the micro level within a stylised equilibrium model of product-cycle trade and growth. Trade integration of the magnitude observed between the OECD and low-wage nations as a whole can consi...

We study how management practices shape export performance using matched productiontrade-management data for Chinese and American firms and a randomized control trial in India. Better managed firms are more likely to export, sell more products to more destinations, and earn higher export revenues and profits. They export higher-quality products at...

We revisited Indian weaving firms nine years after a randomized experiment that changed their management practices. While about half of the practices adopted in the original experimental plants had been dropped, there was still a large and significant gap in practices between the treatment and control plants, suggesting lasting impacts of effective...

Long-run growth in many models is the product of two terms: the effective number of researchers and their research productivity. We present evidence from various industries, products, and firms showing that research effort is rising substantially while research productivity is declining sharply. A good example is Moore’s Law. The number of research...

Slow growth over the last decade has prompted policy attention towards increasing R&D spending, often via the tax system. We examine the impact of R&D on firm performance, both by the firm's own investments and through positive (and negative) spillovers from other firms. We analyse panel data on US firms over the last three decades, and allow for t...

Economic theory suggests that market economies are likely to underprovide innovation because of the public good nature of knowledge. Empirical evidence from the United States and other advanced economies supports this idea. We summarize the pros and cons of different policy instruments for promoting innovation and provide a basic “toolkit” describi...

Economic theory suggests that market economies are likely to underprovide innovation because of the public good nature of knowledge. Empirical evidence from the United States and other advanced economies supports this idea. We summarize the pros and cons of different policy instruments for promoting innovation and provide a basic “toolkit” describi...

We investigate the link between hospital performance and managerial education by collecting a large database of management practices and skills in hospitals across nine countries. We find that hospitals closer to universities offering both medical education and business education have lower mortality rates from Acute Myocardial Infarction (heart at...

Partnering with the US Census Bureau, we implement a new survey of "structured" management practices in two waves of 35,000 manufacturing plants in 2010 and 2015. We find an enormous dispersion of management practices across plants, with 40 percent of this variation across plants within the same firm. Management practices account for more than 20 p...

Combining a unique survey of Japanese firms’ GDP forecasts with accounting data for 25 years, we find three main results. First, firms’ GDP forecasts are associated with their employment, investment, and output growth in the subsequent year. Second, over optimistic and pessimistic forecast errors predict lower profitability and productivity, consis...

We use a massive, matched employer-employee database for the United States to analyze the contribution of firms to the rise in earnings inequality from 1978 to 2013. We find that one-third of the rise in the variance of (log) earnings occurred within firms, whereas two-thirds of the rise occurred due to a rise in the dispersion of average earnings...

The UK's decision to leave the EU in the 2016 referendum created substantial uncertainty for UK businesses. The nature of this uncertainty is different from that of a typical uncertainty shock because of its length, breadth and political complexity. Consequently, a new firm‐level survey, the Decision Maker Panel (DMP), was created to investigate th...

We build a model of firm-level innovation, productivity growth, and reallocation featuring endogenous entry and exit. A new and central economic force is the selection between high- and low-type firms, which differ in terms of their innovative capacity. We estimate the parameters of the model using US Census microdata on firm-level output, R&D, and...

We investigate the role of uncertainty in business cycles. First, we demonstrate that microeconomic uncertainty rises sharply during recessions, including during the Great Recession of 2007–2009. Second, we show that uncertainty shocks can generate drops in gross domestic product of around 2.5% in a dynamic stochastic general equilibrium model with...

Large firms have paid significantly higher wages for over a century. Based on administrative data we document that the large-firm wage premium (LFWP) has declined steadily over the last 30 years. Decomposing pay into worker and firm fixed effects, we then document that the LFWP can be largely explained by a rise in firm effects with firm size. The...

We study the relationship among productivity, management practices, and employee ability using German data combining management practices surveys with employees’ longitudinal earnings records. Including human capital reduces the association between productivity and management practices by 30%–50%. Only a small fraction is accounted for by the highe...