Aleksandra Kacperczyk

Social Influence and Entrepreneurship: The Effect of University Peers on Entrepreneurial Entry

Theories of entrepreneurship have proposed that entrepreneurs are shaped by contextual influences. This paper examines the social transmission of entrepreneurial behavior across university peers. I propose that peers acquainted at a university increase the probability of an entrepreneurial entry by transmitting information about new opportunities and by reducing the uncertainty associated with entrepreneurship. Based on unique data on hedge fund foundings between 1979 and 2006, this study documents that past entrepreneurial behaviors of university peers are an important driver of individual rates of entrepreneurship. Additional analyses show that social influence has a stronger effect on the transition to entrepreneurship when exerted by spatially proximate university peers and university peers who share gender with the focal individual. These findings provide evidence that the effect of university peers arises as a result of social influence rather than the institutional impact of universities. Together, the results uncover novel pathways of social transmission of entrepreneurship and strengthen evidence for the role of contextual influences in shaping entrepreneurial entry.

Opportunity Structures in Established Firms Entrepreneurship versus Intrapreneurship in Mutual Funds

This study revisits the well-established notion that large and mature organizations stifle an employee’s ability and motivation to become an entrepreneur. Using unique data on U.S. mutual funds founded between 1979 and 2005, I examine whether large and mature firms, which are typically associated with lower individual rates of entrepreneurship, are also associated with lower individual rates of intrapreneurship. The findings show that, though employees in large and mature organizations are less likely to transition to entrepreneurship, they nonetheless exhibit a higher propensity to pursue venturing opportunities inside the established firm than employees in smaller and younger firms. The results suggest that the observed negative effect of large, mature organizations on entrepreneurship arises partly due to high rates of intrapreneurship and that the stultification processes in such organizations are far less important than has been generally assumed.

Disentangling risk and change: internal and external social comparison in the mutual fund industry

Using data on 3,225 actively managed U.S. mutual funds from 1980 to 2006, we test hypotheses designed to disentangle risk and change as outcomes of behavioral performance feedback routines. We theorize that managers make decisions involving risk and decisions involving change under different conditions and motivated by different concerns. Our results show internal social comparison across units within a firm will motivate risk, whereas external social comparison across firms will motivate change. When a fund experiences a performance shortfall relative to internal social comparison, the manager is likely to make decisions that involve risk because the social and spatial proximity of internal comparisons trigger individual concern and fear of negative individual consequences, such as job loss. In contrast, when a fund experiences a performance shortfall in comparison with external benchmarks, the manager is more likely to consider the shortfall an organizational concern and make changes that do not necessarily involve risk. Although we might assume that negative performance in comparison with both internal and external benchmarks would spur risky change, our results indicate that risky change occurs most often when a decision maker receives unfavorable internal social performance feedback and favorable external social performance feedback. By questioning assumptions about why and when organizational change involves risk, this study begins to separate change and risk outcomes of the decision-making process.

The Paradox of Breadth: The Tension between Experience and Legitimacy in the Transition to Entrepreneurship*:

In a study of artists who launched independent record labels in the music industry from 1990 to 2013, we focus on explaining the paradox generated when prospective entrepreneurs accumulate broad functional experience, which signals to resource providers mastery of different skills and access to various information and resources but may also undermine the legitimacy of their entrepreneurial claims because they are not seen as specialists. To resolve this paradox, we theorize that the potential legitimacy discount of categorical membership can be avoided when individuals are classified according to multiple categories simultaneously. We find that the transition to entrepreneurship is most likely to occur when an artist’s functional experience is broad but market experience is narrow: he or she has mastered a variety of skills but solicited few audiences. We also find that the paradox of breadth is attenuated—the potential penalty of functional breadth and the corresponding need to develop narrow market experience are reduced—when the entrepreneur has alternate methods of signaling legitimacy, including high status and more-typical prior work experience. Moreover, some audiences are more disposed than others to allow an entrepreneur to pursue greater novelty. Our findings suggest that mastering a variety of skills is not universally beneficial for aspiring entrepreneurs. In some circumstances, such mastery is best coupled with a narrow market focus.

Revisiting the Small-Firm Effect on Entrepreneurship: Evidence from Firm Dissolutions

Afrequent claim in the entrepreneurship literature is that employees learn to become entrepreneurs during paid employment. We revisit this mechanism in the context of the well-established finding that smaller firms generate higher rates of entrepreneurship. We propose a novel mechanism responsible for higher rates of entrepreneurship emanating from smaller firms: large firms might have a advantage over small firms in providing internal opportunities to retain entrepreneurial talent. We test this claim in a setting where firm dissolution extinguishes internal opportunities, using a new hand-collected data set of career histories in the automatic speech recognition (ASR) industry. For nondefunct firms, we replicate the “small-firm effect.” However, the small-firm effect no longer holds within the subsample of defunct firms: entrepreneurship rates among individuals present at firm dissolution are in fact higher for larger firms. Additional analyses indicate that this effect is unlikely to be driven by the early departure of higher-skilled workers who anticipate the firm’s demise. Finally, we find preliminary evidence consistent with the notion that large organizations may not only retain but also “mold” workers into entrepreneurs. More broadly, the study emphasizes the need to consider a novel mechanism responsible for transition into entrepreneurship—the role of opportunities available to employees in incumbent firms.

Vertical and Horizontal Wage Dispersion and Mobility Outcomes: Evidence from the Swedish Microdata

Using employer–employee matched data from Sweden between 2001 and 2008, we test hypotheses designed to assess the contingent nature of the relationship between wage dispersion and cross-firm mobility. Whereas past research has mostly established that dispersed wages increase interfirm mobility, we investigate the conditions under which pay variance might have the opposite effect, serving to retain workers. We propose that the effect of wage dispersion is contingent on organizational rank and that it depends on whether wages are dispersed vertically (between job levels) or horizontally (within the same job level). We find that vertical wage dispersion suppresses cross-firm mobility because it is associated with outcomes beneficial for employees, such as attractive advancement opportunities. By contrast, horizontal wage dispersion increases cross-firm mobility because it is associated with outcomes harmful for employees, such as inequity concerns. We further find that the vertical-dispersion effect is ampli...

Social Isolation in the Workplace: A Cross-National and Longitudinal Analysis

This study examines the degree of social connectedness in the workplace. Organizational theory and sociology of work lead to the expectation that informal ties have become more prevalent at work over the past two decades. In contrast, influential accounts of decreasing civic engagement would predict that co-worker ties have declined along with increasing social isolation. Using data from two waves of the General Social Survey, we find evidence that co-workers have not absorbed the decline in other social ties; instead, prevalence of co-workers in core discussion networks has significantly decreased between 1985 and 2004. Moreover, cross-national comparisons based on data collected in 29 nations by the International Social Survey Program reveal social isolation in the workplace to be deeper in historically Protestant nations, including the United States. Yet American workers are even more disconnected from close contacts than are workers in other historically Protestant nations. We suggest that historical trends in cultural value orientations shape current constraints of social connectedness at work in the United States and elsewhere. The conclusion offers novel insights on fraying social fabric in the United States and the social implications of the rise of organizations.

Occupational Licensure and Entrepreneurs: The Case of Tax Preparers in the U.S.

The authors examine the relationship between entrepreneurship and occupational licensure using data on the universe of more than 700,000 tax preparers in the United States. Prior research suggested that occupational licensure has negative effects on entrepreneurship because it increases the costs of operating a business. By contrast, the authors argue that licensure may allow entrepreneurs to signal quality and enhance their legitimacy. States that require tax preparers to be licensed have higher average rates of entrepreneurship—approximated by tax practice ownership—and, in high-income ZIP codes, more demand for paid preparer services. In the analysis of the introduction of a federal license requirement in tax preparation in 2013, voluntary early adoption of the license by preparers predicts higher chances of survival in the industry. Entrepreneurs are less likely to adopt the license early than are non-entrepreneurs, unless they lack other state-level credentials. Results thus suggest that licensure represents a trade-off for entrepreneurs between the costs of obtaining a license and the benefits of signaling quality and legitimacy.

Discrimination and Entrepreneurship: Evidence from LGBT Rights Laws

This study revisits the well-established claim that reducing discrimination spurs entrepreneurial entry. We propose that the effect of antidiscrimination initiatives on entrepreneurship depends crucially on whether discrimination originates on the demand- or the supply-side of the entrepreneurial process. The benefits of antidiscrimination practices in the context of entry are based on the study of the demand-side discrimination, or bias which arises when prospective entrepreneurs face discrimination by key resource providers for a new venture (i.e., investors, banks, prospective employers). We hypothesize the opposite effect on the supply-side, or when prospective entrepreneurs face discrimination in paid employment. Using evidence from the enactment of LGBT antidiscrimination policies, we show that initiatives to reduce employer discrimination deter entry into entrepreneurship because they increase the appeal of paid employment relative to entrepreneurship. Despite the reduction in the rates of entrepre...

Corporate Social Responsibility as a Defense against Knowledge Spillovers: Evidence from the Inevitable Disclosure Doctrine

In this study, we theorize and empirically examine whether companies respond to the threat of knowledge spillovers by strategically increasing their engagement in corporate social responsibility (CSR). To obtain exogenous variation in the threat of knowledge spillovers, we exploit a natural experiment provided by the rejection of the inevitable disclosure doctrine (IDD) by several U.S. states between 1991 and 2013. Since the doctrine prevents employees with valuable know-how from working for a competitor in the immediate future, the doctrines rejection facilitates knowledge appropriation by rivals. Using a difference-in-differences methodology, we find that companies react to the increased threat of knowledge spillovers by increasing their CSR. We further provide evidence that the increase in CSR is stronger for companies i) located closer to innovation hubs as well as companies operating in industries that are ii) more R&D intensive, iii) more competitive, and iv) have more attractive investment opportunities. Overall, these results are consistent with the notion that CSR serves as a strategic tool to mitigate the risk of knowledge spillovers.