Nicholas Bloom

Bloom was educated at the University of Oxford and the University of Cambridge. He completed a PhD at University College London in 2001 under the supervision of John Van Reenen and Richard Blundell.{{cite thesis|degree=PhD|publisher=University College London (University of London)|url=https://catalogue.libraries.london.ac.uk/record=b1989629|doi=|title=The real options effects of uncertainty on investment and labour demand|first= Nicholas Alexander|last=Bloom|date=2001|id={{EThOS|uk.bl.ethos.252404}}|website=london.ac.uk|oclc=498852322}}

From 1996 to 2002 he worked at the Institute for Fiscal Studies and on business tax policy at HM Treasury. From 2002 to 2003 he worked at McKinsey & Company, and in 2003 he moved to the Centre for Economic Performance at the London School of Economics, and to Stanford University in 2005.

File:AEA 2025 - Nick Bloom 01.jpg

He spoke on working from home at the 2014 White House Working Families Summit alongside Business Leaders, Trade Unionists, President Obama and Vice President Biden,{{Cite web|url=https://www.womenadvancenc.org/2014/06/23/4752/ |title=Women Advance |date=2014-06-23 |access-date=2014-06-23|language=en-US }} and at Tedx Stanford in 2017.{{Cite web|url=https://www.youtube.com/watch?v=oiUyyZPIHyY&ab_channel=TEDxTalk |title=TedX Stanford 2017 |website=YouTube |date=2017-04-22 |access-date=2017-05-22|language=en-US }} His research on remote work has been cited and discussed in The New York Times,{{Cite news |url=https://www.nytimes.com/2014/03/08/your-money/when-working-in-your-pajamas-is-more-productive.html |title=It's Unclearly Defined, but Telecommuting Is Fast on the Rise |last=Tugend |first=Alina |work=The New York Times |date=March 7, 2014 | url-access=limited | issn=0362-4331}} The Wall Street Journal{{Cite news|url=https://www.wsj.com/articles/SB10001424127887324539404578342503214110478|title=More Americans Working Remotely|last=Shah|first=Neil|date=2013-03-05|work=Wall Street Journal|access-date=2019-03-28|language=en-US|issn=0099-9660}} and Freakonomics Radio.{{cite web|url=https://freakonomics.com/podcast/why-are-there-so-many-bad-bosses/|title=EPISODE 495: Why Are There So Many Bad Bosses?|website=freakonomics.com}}

Bloom has been behind the modern measurement of management quality, and emphasizing it as important in explaining differences in productivity between countries. In 2007, Bloom, with his frequent co-authors John Van Reenen and Raffaella Sadun, created a massive survey dataset on management quality across firms.Nicholas Bloom, John Van Reenen, Measuring and Explaining Management Practices Across Firms and Countries, The Quarterly Journal of Economics, Volume 122, Issue 4, November 2007, Pages 1351–1408, https://doi.org/10.1162/qjec.2007.122.4.1351Bloom, Nicholas, and John Van Reenen. 2010. "Why Do Management Practices Differ across Firms and Countries?" Journal of Economic Perspectives 24 (1): 203–24.

DOI: 10.1257/jep.24.1.203 They would subsequently be responsible for the creation of the Management and Organizational Practices Survey by the U.S. Census Bureau, which has been an invaluable resource for fellow economists.Bloom, Nicholas, Erik Brynjolfsson, Lucia Foster, Ron Jarmin, Megha Patnaik, Itay Saporta-Eksten, and John Van Reenen. 2019. "What Drives Differences in Management Practices?" American Economic Review 109 (5): 1648–83.

DOI: 10.1257/aer.20170491Buffington, Foster, Jarmin, Ohlmacher, "The Management and Organizational Practices Survey (MOPS): An Overview", Jan. 12, 2017, https://www.census.gov/content/dam/Census/library/working-papers/2017/econ/buffington-01.pdf

Bloom has directly tested the impact of management interventions in the developing world. In “Does Management Matter?” he (with Eifert, Mahajan, McKenzie, and Roberts) tested a randomized controlled trial introducing better management practices to Indian textile firms. The interventions raised profitability by 17% per year, or an average of $300,000 per firm.Nicholas Bloom, Benn Eifert, Aprajit Mahajan, David McKenzie, John Roberts, Does Management Matter? Evidence from India, The Quarterly Journal of Economics, Volume 128, Issue 1, February 2013, Pages 1–51, https://doi.org/10.1093/qje/qjs044 The gains were persistent, and the firms had higher returns over 8 years later.Bloom, Nicholas, Aprajit Mahajan, David McKenzie, and John Roberts. “Do Management Interventions Last? Evidence from India.” American Economic Journal: Applied Economics 12, no. 2 (2020): 198–219. https://www.jstor.org/stable/26909451. Other work by him on management has shown how multinationals bring their culture with them, how multinationals are quicker to adopt new technology,Bloom, Nicholas, Raffaella Sadun, and John Van Reenen. 2012. "Americans Do IT Better: US Multinationals and the Productivity Miracle." American Economic Review 102 (1): 167–201.

DOI: 10.1257/aer.102.1.167

how competition improves management quality in public hospitalsNicholas Bloom, Carol Propper, Stephan Seiler, John Van Reenen, The Impact of Competition on Management Quality: Evidence from Public Hospitals, The Review of Economic Studies, Volume 82, Issue 2, April 2015, Pages 457–489, https://doi.org/10.1093/restud/rdu045 and in schools,Nicholas Bloom, Renata Lemos, Raffaella Sadun, John Van Reenen, Does Management Matter in schools?, The Economic Journal, Volume 125, Issue 584, May 2015, Pages 647–674, https://doi.org/10.1111/ecoj.12267 and how the business environment, plus other entrants into the same area, improve the management of firms. He consistently finds that management quality, and thus total factor productivity, is affected by competition. Managers are not always maximizing the profits of their firm, but rather their own utility. It suggests that trade barriers have a negative welfare impact beyond the standard deadweight loss, and even beyond the reallocation of employment between firms – it also leaves firms enervated, inefficient, and less innovative.

Bloom has contributed to our understanding of technological innovation. In “Competition and Innovation: An Inverted U Relationship” he (with Aghion, Blundell, Griffith, and Howitt) shows how both too much, and too little, competition stifle the rate of technological development. With too little competition, the firm is collecting monopoly rents, and so fears any substantial shakeup. With too much competition, firms cannot make the fixed costs necessary for research. Innovation is maximized somewhere in between the two extremes.Philippe Aghion, Nick Bloom, Richard Blundell, Rachel Griffith, Peter Howitt, Competition and Innovation: an Inverted-U Relationship, The Quarterly Journal of Economics, Volume 120, Issue 2, May 2005, Pages 701–728, https://doi.org/10.1093/qje/120.2.701

It is not necessarily obvious which firms are in competition with each other. Bloom has made fundamental contributions to identifying how different firms interact with each, by extending the work of Jaffe (1986)Jaffe, Adam B. “Technological Opportunity and Spillovers of R & D: Evidence from Firms’ Patents, Profits, and Market Value.” The American Economic Review 76, no. 5 (1986): 984–1001. http://www.jstor.org/stable/1816464. (which uses the correlation of firm patents in different technology classes to measure how close firms are in “space”) to the product market as well. He, Mark Schankerman, and Van Reenen use this, as well as changes in tax policy to eliminate similar businesses facing similar shocks, to quantify whether the positive spillovers of spreading knowledge outweigh the negative spillovers of stealing business from rivals. They find that the positive spillovers are predominant, that a firm inventing a technology makes its competitors more profitable and productive, and that the social returns to research and development are twice as high as the private returns.Bloom, N., Schankerman, M. and Van Reenen, J. (2013), Identifying Technology Spillovers and Product Market Rivalry. Econometrica, 81: 1347-1393. https://doi.org/10.3982/ECTA9466 This ties in with Chad Jones and John C. Williams (1998), who estimate that the optimal rate of R&D spending is two to four times larger than it actually is.Charles I. Jones, John C. Williams, Measuring the Social Return to R&D, The Quarterly Journal of Economics, Volume 113, Issue 4, November 1998, Pages 1119–1135, https://doi.org/10.1162/003355398555856

Bloom would go on to work with Chad Jones, as well as Van Reenen and Michael Webb, to see if ideas are becoming harder to find. This is of profound importance for our understanding of growth – if there are decreasing returns to innovation, then in the long run how much we can grow is capped by population growth. They find that, while the rate of technological discovery has been relatively smooth, this has come only from dedicating more and more resources to research. Measured researcher productivity, across many different domains, has consistently fallen over time.Bloom, Nicholas, Charles I. Jones, John Van Reenen, and Michael Webb. 2020. "Are Ideas Getting Harder to Find?" American Economic Review 110 (4): 1104–44.

DOI: 10.1257/aer.20180338Lorenz Ekerdt and Kai-Jie Wu, "Self-selection and the Diminishing Returns of Research", R&R AER

Since research is insufficiently produced, governments frequently subsidize it. Bloom, Rachel Griffith, and Van Reenen found that tax incentives do increase research intensity, with research rising by more in the long-run as firms adjust to the change.Bloom, Nick & Griffith, Rachel & Van Reenen, John, 2002. "Do R&D tax credits work? Evidence from a panel of countries 1979-1997," Journal of Public Economics, Elsevier, vol. 85(1), pages 1-31, July. Later work cautions against direct subsidies to incumbents, however, as it discourages the exit of less productive firms. Paradoxically, taxing incumbent firms could increase welfare.Acemoglu, Daron, Ufuk Akcigit, Harun Alp, Nicholas Bloom, and William Kerr. 2018. "Innovation, Reallocation, and Growth." American Economic Review 108 (11): 3450–91.

DOI: 10.1257/aer.20130470 Analogously, Bloom, Mirko Draca, and Van Reenen found that the surge in Chinese import competition led to technical progress within firms, and reallocated labor to the most technologically advanced firms.Nicholas Bloom, Mirko Draca, John Van Reenen, Trade Induced Technical Change? The Impact of Chinese Imports on Innovation, IT and Productivity, The Review of Economic Studies, Volume 83, Issue 1, January 2016, Pages 87–117, https://doi.org/10.1093/restud/rdv039 This is in line with the predictions of the Melitz-Ottoviano model – simultaneous increases in market size, and in the rigor of competition, benefit those firms with the lowest marginal costs of production.Melitz, Marc J., and Daniel Trefler. 2012. "Gains from Trade When Firms Matter." Journal of Economic Perspectives 26 (2): 91–118.

DOI: 10.1257/jep.26.2.91 Because of his work, Bloom favors boosting the supply of skilled laborers, whether through supporting education or through expanded immigration.Bloom, Nicholas, John Van Reenen, and Heidi Williams. 2019. "A Toolkit of Policies to Promote Innovation." Journal of Economic Perspectives 33 (3): 163–84.

DOI: 10.1257/jep.33.3.163

Bloom has numerous papers focused on uncertainty, including his doctoral work which won the Frisch Medal in 2010.Bloom, N. (2009), The Impact of Uncertainty Shocks. Econometrica, 77: 623-685. https://doi.org/10.3982/ECTA6248 He defines uncertainty as when firms are less able to forecast the future accurately. Proxies like stock market volatility capture this because the present stock market price is equivalent to the expected discounted returns of the asset, and so price changes occur when people collectively misassed the price of assets.Bloom, Nicholas. 2014. "Fluctuations in Uncertainty." Journal of Economic Perspectives 28 (2): 153–76.

DOI: 10.1257/jep.28.2.153 With Scott Baker and Steven Davis, he created a newspaper based index of economic policy uncertainty, which has been widely used by later authors. He has studied how uncertainty can exacerbate business cycles,Bloom, N., Floetotto, M., Jaimovich, N., Saporta-Eksten, I. and Terry, S.J. (2018), Really Uncertain Business Cycles. Econometrica, 86: 1031-1065. https://doi.org/10.3982/ECTA10927 reduce investment,Nick Bloom, Stephen Bond, and John van Reenen. “Uncertainty and Investment Dynamics.” The Review of Economic Studies 74, no. 2 (2007): 391–415. http://www.jstor.org/stable/4626145. and prevent reallocation.

Bloom has been one of the leading voices on remote work, starting long before the Covid pandemic brought it to prominence. In “Does Working From Home Work?”, he (with James Liang, John Roberts, and Zhichun Jenny Ying) found in 2015 that call center employees experienced substantially raised productivity from working from home, even when employees could select whether or not they participated in it.Bloom, Nicholas, James Liang, John Roberts, and Zhichun Jenny Ying. “DOES WORKING FROM HOME WORK? EVIDENCE FROM A CHINESE EXPERIMENT.” The Quarterly Journal of Economics 130, no. 1 (2015): 165–218. https://www.jstor.org/stable/26372598. In a later study, he, Liang, and Ruobing Han ran a randomized controlled trial on hybrid work for professional workers, finding it did not damage performance, but did reduce the rate of turnover.Bloom, N., Han, R. & Liang, J. Hybrid working from home improves retention without damaging performance. Nature 630, 920–925 (2024). https://doi.org/10.1038/s41586-024-07500-2

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Category:Stanford University Department of Economics faculty

Category:Stanford University Graduate School of Business faculty

Category:Fellows of the Econometric Society

Category:Fellows of the American Academy of Arts and Sciences

Category:British economists

Category:21st-century American economists

Category:Alumni of Fitzwilliam College, Cambridge

Category:Alumni of St Peter's College, Oxford

Category:Alumni of University College London

Category:1973 births

Category:Living people