Local leaders and the pursuit of growth in US cities: the role of managerial skill

Abstract

Do the choices of city leaders matter for local economic conditions? While existing literature focuses on how the preferences of local officials influence city policy, we argue that the managerial skill of local leaders should condition their ability to achieve their goals. We conduct an original phone survey of over 300 mayors and city managers across the USA to learn about their management practices. Using a two-way fixed effects design that holds fixed a rich battery of individual and city-level characteristics, we examine how changes in leadership affect economic growth, a common goal for local officials. We find that when local leaders employ the “best practices” of organizational management, their cities grow across a range of indicators. These results are strongest for the subset of leaders who mention a growth-related goal for their time in office, suggesting that managerial skill allows local leaders to more effectively achieve their objectives.