Firms in developing countries are faced with a variety of constraints that may hamper their productivity and threaten their survival, with broader implications for economy-wide growth. These range from external characteristics such as difficulty in access to finance, lack of market outlets, macroeconomic uncertainty, and complicated government policies, to internal features such as shortage of labour and lack of technical knowledge. Another crucial internal constraint is the scarcity of managerial capital, which relates to managerial practices and inherent talent. Better managerial capital can improve the marginal productivity of other inputs, and affect the quantity and quality of other inputs in the production process (Bruhn et al., 2010). Managerial heterogeneity has only recently started receiving attention in the empirical literature as an additional quantifiable explanation of between-country and between-firm productivity gaps (e.g., Bloom and Van Reenen, 2007; Bloom et al., 2014; Bruhn et al., 2010).1 For instance, Bloom and Van Reenen (2007) use data from medium-sized manufacturing plants in the US and Europe to find management practices to be positively associated with total factor productivity and GDP per capita.2 In a similar vein, McKenzie and Woodruff (2017) uncover that implementation of business practices – related to financial planning, marketing and record-keeping – in small firms in seven developing countries increases labour productivity and total factor productivity. While one part of managerial quality derives from management and business practices, another dimension is related to inherent talent and entrepreneurial traits, with the latter possibly influencing the adoption of the former. In fact, using data from large manufacturing firms in Brazil, France, Germany, India, UK and USA, Bandiera et al. (2017) show that while CEO behaviour and management practice scores are correlated with one another, they exercise independent influences on firm performance.