Early stage technology startups rely critically on talented scientists and engineers to commercialize new technologies. And yet these startups compete with established technology firms to hire the best workers. Theories of ability sorting predict that high-ability workers will choose jobs in established firms that offer greater complementary assets and higher pay, leaving low-ability workers to take lower paying and riskier jobs in startups. We propose an alternative view in which heterogeneity in both worker ability and preferences enable startups to hire talented workers who have a taste for a startup work environment even at lower pay. Using a longitudinal survey that follows 2,394 science and engineering PhDs from graduate school into their first industrial employment, we overcome common empirical challenges by observing ability and stated preferences prior to entry into the labor market. We find that both ability and career preferences strongly predict startup employment with high-ability workers who prefer startup employment being the most likely to work in a startup. We show that this partly reflects dual selection effects whereby worker preferences result in a large pool of startup job applicants and startups make job offers to the most talented workers. Additional analyses confirm that startup employees earn approximately 17% lower pay. This gap is greatest for high-ability workers and persists over workers’ early careers, suggesting that they accept a negative compensating differential in exchange for the nonpecuniary benefits of startup employment. Data on job attributes and stated reasons for job choice further support this interpretation. This paper was accepted by Toby Stuart, entrepreneurship and innovation. Funding: This work was supported by the National Science Foundation SciSIP Award [Grant 1262270] and the Ewing Marion Kauffman Foundation (Junior Faculty Fellowship). Supplemental Material: The online appendix and data are available at https://doi.org/10.1287/mnsc.2023.4868 .

Many Ph.D.'s follow an inefficient path to green cards through visas aimed at entry-level workers

Early-stage technology startups face considerable competition from established firms when hiring highskilled scientists and engineers. Given that early-stage startups are risky employers and often lack resources to attract highly talented employees, conventional labor market theories predict that high-ability workers will instead sort into established firms that offer greater complementary assets and higher pay. We propose an alternative view, in which employment sorting reflects the interplay between ability and career preferences, allowing startups to hire high-ability workers who have a distinct taste for a startup work environment. We use microdata from a longitudinal survey that follows a cohort of 2,368 science and engineering PhDs from graduate school into their subsequent first-time employment. These novel data enable us to distinguish ability from typically unobserved ex ante preferences, and to directly examine selfselection into first-time employment. Contrary to conventional theories, we find that startups can attract many high-ability workers, even at lower pay. Further analyses of the interplay between preferences and ability confirm that preferences for working in a startup environment shape which individuals apply for and accept startup jobs, while ability is the primary predictor of which applicants get offers in their desired career. We discuss implications for founders, managers, and policy makers, as well as for research on entrepreneurship and human capital.

This paper explores the relationship between team success, both in absolute terms and relative to preseason expectations, and subsequent personnel investments in Major League Baseball. Given the many ways in which luck impacts game outcomes, underperforming expectations could partially reflect negative, nonpersistent luck. If teams account for this, underperforming teams would make personnel investments more in line with teams with higher win totals. Using fixed effect panel regressions, I find that higher win totals lead to more invest more in personnel for the following season (as measured by changes in payroll and free agent signings) and that, conditional on win totals, underperformance leads to more investment. This is consistent with the theoretical prediction. Additional investment is rational, as I find a team’s level of underperformance is roughly 30% nonpersistent noise. The remaining 70% of underperformance is informative and is effectively incorporated into expected win totals for the following season.

The papers included in this symposium aim to enrich and complement the growing literature on entrepreneurial motives from different theoretical and methodological perspectives. While all focus on understanding the links between motives and entrepreneurial outcomes, the papers apply behavioral, economic, social psychological, and cognitive lenses and use a variety of methods including qualitative, survey, linguistic, and experimental methods. Taken together, they offer evidence that the study of motives is important to enriching our understanding of several entrepreneurial processes, including employee entrepreneurship, serial entrepreneurship, business idea development, and financial and human resource acquisition. The goal of this symposium is to raise awareness and spark debate around the multiple ways in which motives matter to entrepreneurial outcomes. Spinning an Entrepreneurial Career: Uncovering Motivational Pathways to Venture Success Presenter: Hyeonsuh Lee; U. of Illinois at Urbana-Champaign Presenter: Sonali Shah; U. of Illinois at Urbana-Champaign Presenter: Rajshree Agarwal; U. of Maryland Saved by a Partner: Founder Intrinsic Motivation, Entrepreneurial Survival, and Partnership Gains Presenter: Jihae Shin; U. of Wisconsin, Madison Presenter: Yuna Cho; Yale School of Management Presenter: Laura Huang; Harvard Business School Ability, Preferences, and Employment in Early-Stage Technology Startups Presenter: Michael Roach; Cornell U. Presenter: Henry Sauermann; ESMT European School of Management and Technology Understanding the Relationship Between the Vocabulary of Local Entrepreneurs and Community Investors Presenter: Esther Leibel; Boston U.

Visa policies to retain United States-trained STEM PhDs are of central importance to national innovation and economic competitiveness. There is also growing interest in "startup" visas that stimulate entrepreneurial activity and job creation, particularly in technology sectors. However, there is little understanding of how visa policies might influence foreign PhDs' employment in technology startups. This study investigates differences between 2,324 foreign and US PhDs from US research universities using a longitudinal survey of individuals' preferences and characteristics during graduate school and their subsequent employment in a startup or established firm. Among PhDs whose first job is industrial research & development, 15.8% of US PhDs work in a startup compared with 6.8% of foreign PhDs. Foreign PhDs are as likely as US PhDs to apply to and receive offers for startup jobs, but conditional on receiving an offer, they are 56% less likely to work in a startup. This disparity is partially explained by differences in visa sponsorship between startups and established firms and not by foreign PhDs' preferences for established firm jobs, risk tolerance, or preference for higher pay. Foreign PhDs who first work in an established firm and subsequently receive a green card are more likely to move to a startup than another established firm, suggesting that permanent residency facilitates startup employment. These findings suggest that US visa policies may deter foreign PhDs from working in startups, thereby restricting startups' access to a large segment of the STEM PhD workforce and impairing startups' ability to contribute to innovation and economic growth.

Visa policies to retain United States-trained STEM PhDs are of central importance to national innovation and economic competitiveness. There is also growing interest in “startup” visas that stimulate entrepreneurial activity and job creation, particularly in technology sectors. However, there is little understanding of how visa policies might influence foreign PhDs’ employment in technology startups. This study investigates differences between 2,324 foreign and US PhDs from US research universities using a longitudinal survey of individuals’ preferences and characteristics during graduate school and their subsequent employment in a startup or established firm. Among PhDs whose first job is industrial research & development, 15.8% of US PhDs work in a startup compared with 6.8% of foreign PhDs. Foreign PhDs are as likely as US PhDs to apply to and receive offers for startup jobs, but conditional on receiving an offer, they are 56% less likely to work in a startup. This disparity is partially explained by differences in visa sponsorship between startups and established firms and not by foreign PhDs’ preferences for established firm jobs, risk tolerance, or preference for higher pay. Foreign PhDs who first work in an established firm and subsequently receive a green card are more likely to move to a startup than another established firm, suggesting that permanent residency facilitates startup employment. These findings suggest that US visa policies may deter foreign PhDs from working in startups, thereby restricting startups’ access to a large segment of the STEM PhD workforce and impairing startups’ ability to contribute to innovation and economic growth.

We examine the role of career preferences, ability, and structural constraints in explaining first-time employment in startups or established firms. Using panel data on 2,243 U.S. science and engin...

In recent years, high-tech industries that grew out of university- based start-ups or deeply entrenched in academic science have been an important driver of economic growth and life improvement for developed and emerging economies across the globe. Prior literature on academic entrepreneurship and technology commercialization has shown the complexity of the phenomenon and points to factors across macro-, meso-, and micro-levels. This literature, though substantial in volume, lacks overarching theoretical insights that integrate findings from different contexts and mechanisms at different levels. Recent developments from the new institutional theory from organizational sociology provided theoretical tools for this task. In this symposium, we bring together a group of scholars that apply the institutional approach to the study of academic entrepreneurship and technology commercialization, with the aim of providing theoretical insights for this topical area and enriching institutional theories as well. Scaffolds and Intermediaries Presenter: Daniel Erian Armanios; Engineering & Public Policy (EPP), Carnegie Mellon U. Presenter: Charles Eric Eesley; Stanford U. Protecting Scientists from Gordon Gekko Presenter: Markus Perkmann; Imperial College London Presenter: Maureen McKelvey; U. of Gothenburg Presenter: Nelson Phillips; Imperial College London How Prospect of Status Change Affect Licensing of University Technology Overtime in China? Presenter: Xirong Shen; Cornell U. Presenter: Ximing Yin; Tsinghua U. Presenter: Wesley Sine; Cornell U. Do University Entrepreneurship Programs Promote Entrepreneurship? Presenter: Yong Suk Lee; Stanford U. Presenter: Charles Eric Eesley; Stanford U. Distinguishing Between the Roles of Faculty and PhDs in Academic Entrepreneurship Presenter: Michael Roach; Cornell

There is increasing evidence that science & engineering PhD students lose interest in an academic career over the course of graduate training. It is not clear, however, whether this decline reflects students being discouraged from pursuing an academic career by the challenges of obtaining a faculty job or whether it reflects more fundamental changes in students’ career goals for reasons other than the academic labor market. We examine this question using a longitudinal survey that follows a cohort of PhD students from 39 U.S. research universities over the course of graduate training to document changes in career preferences and to explore potential drivers of such changes. We report two main results. First, although the vast majority of students start the PhD interested in an academic research career, over time 55% of all students remain interested while 25% lose interest entirely. In addition, 15% of all students were never interested in an academic career during their PhD program, while 5% become more interested. Thus, the declining interest in an academic career is not a general phenomenon across all PhD students, but rather reflects a divergence between those students who remain highly interested in an academic career and other students who are no longer interested in one. Second, we show that the decline we observe is not driven by expectations of academic job availability, nor by related factors such as postdoctoral requirements or the availability of research funding. Instead, the decline appears partly due to the misalignment between students’ changing preferences for specific job attributes on the one hand, and the nature of the academic research career itself on the other. Changes in students’ perceptions of their own research ability also play a role, while publications do not. We discuss implications for scientific labor markets, PhD career development programs, and science policy.

An increasingly important frontier for competition is in the labor market for skilled workers. In particular, competition for a limited supply of STEM workers (science, technology, engineering, and mathematics) has drawn the attention of employers and policymakers worldwide because a) STEM workers are instrumental to the knowledge-based production that characterizes the industries that are driving growth in many modern economies (e.g. high-tech, pharma, healthcare), b) access to these workers can influence the firm's production choices and innovation outcomes, and c) constraints to the supply of these workers in specific markets affects prospects for attracting corporate investment and experiencing growth. Moreover, through their mobility, these workers are often the primary channel for the transfer of knowledge to new organizational contexts. Indeed, a critical determinant of employer performance in recent years has been the ability to successfully attract these workers, so to understand the innovative activities of firms, it has become important to understand the human capital investment and labor supply decisions of these workers. This symposium brings together leading experts in the human capital of science and technology to discuss factors affecting supply and demand in STEM labor markets. Implications for strategy are discussed.

Hiring non-founding employees is one of the first major organizational transitions that entrepreneurial firms face as they move from founding teams to full-fledged organizations. This symposium explores the antecedents and consequences of hiring by entrepreneurial firms. While research in strategy and entrepreneurship has started to explore general processes in how new firms grow and shape the next generation of industry and society, gaps remain in our understanding of crucial early hires and entrepreneurial firms’ goals when hiring. The papers featured are aimed at addressing these gaps. This session will feature four papers that explore: (1) the types of individuals who join start-ups compared to those who work in established firms, (2) the long-term implications of entrepreneurial employment on wages, (3) the effects of founders’ backgrounds and accelerator cohort experience on the nature and timing of early hires, and (4) the relationship between new venture workforce diversity and performance. Who Wo...

This paper investigates how the encouragement of entrepreneurship within university research labs relates with research activities, research outputs, and early doctorate careers. Utilizing a panel survey of 6,840 science & engineering doctoral students at 39 R1 research universities, this study shows that entrepreneurship is widely encouraged across university research labs, ranging from 54% in biomedical engineering to 18% in particle physics, while only a small share of labs openly discourage entrepreneurship, from approximately 3% in engineering to approximately 12% in the life sciences. Within fields, there is no difference between labs that encourage entrepreneurship and those that do not with respect to basic research activity and the number of publications. At the same time, labs that encourage entrepreneurship are significantly more likely to report invention disclosures, particularly in engineering where such labs are 41% more likely to disclose inventions. With respect to career pathways, PhDs students in labs that encourage entrepreneurship do not differ from other PhDs in their interest in academic careers, but they are 87% more likely to be interested in careers in entrepreneurship and 44% more likely to work in a startup after graduation. These results persist even when accounting for individuals' pre-PhD interest in entrepreneurship and the encouragement of other non-academic industry careers.

Complex, diverse rationales require nuanced policies

![][1] ILLUSTRATION: DAVIDE BONAZZIMost efforts to promote technology entrepreneurship, such as courses and incubators, focus on potential founders of startup companies. Yet the vast majority of scientists and engineers contribute to entrepreneurship as “joiners”—employees who join founders in their efforts to start companies. We investigated individuals' entrepreneurial interests through a survey of nearly 4200 science and engineering Ph.D. candidates at tier 1 U.S. research universities ([ 1 ][2]), focusing on three questions: How prevalent are interests in joining a startup as an employee versus being a founder? How are joiners different from founders? How do contextual factors shape different entrepreneurial interests? Among the Ph.D.'s surveyed, 46% were interested in joining a startup as an employee, whereas 11% expected to one day start their own company. Compared with Ph.D.'s interested in careers in established firms, founders and joiners share similar preferences for an entrepreneurial work setting, such as a desire for greater autonomy, tolerance for risk, and a desire to commercialize technologies. However, founders are significantly more risk tolerant and have a stronger interest in management, whereas joiners are more interested in functional work activities such as research and development (RD blanket efforts, such as mandated entrepreneurship training, are likely to be inefficient. Programs should also prepare scientists and engineers for a variety of entrepreneurial roles—joiners as well as founders.1. [↵][3]1. M. Roach, 2. H. Sauermann , Manage. Sci., 10.1287/mnsc.2014.2100 (2015). doi:10.1287/mnsc.2014.2100 [OpenUrl][4][CrossRef][5] [1]: /embed/graphic-1.gif [2]: #ref-1 [3]: #xref-ref-1-1 "View reference 1 in text" [4]: {openurl}?query=rft.jtitle%253DManage.%2BSci.%26rft_id%253Dinfo%253Adoi%252F10.1287%252Fmnsc.2014.2100%26rft.genre%253Darticle%26rft_val_fmt%253Dinfo%253Aofi%252Ffmt%253Akev%253Amtx%253Ajournal%26ctx_ver%253DZ39.88-2004%26url_ver%253DZ39.88-2004%26url_ctx_fmt%253Dinfo%253Aofi%252Ffmt%253Akev%253Amtx%253Actx [5]: /lookup/external-ref?access_num=10.1287/mnsc.2014.2100&link_type=DOI

Entrepreneurial ventures rely not only on founders but also on “joiners”—start-up employees who are attracted to entrepreneurship, but who do not want to be founders themselves. Drawing on both preference and contextual theories of entrepreneurship, we examine how individuals’ interest in being a founder, a joiner, or neither forms prior to the first career transition. We find that although individuals with founder and joiner interests share similar preferences for entrepreneurial job attributes such as autonomy and risk, their preferences for these attributes also differ in significantly meaningful ways. Contextual factors such as norms, role models, and opportunities exhibit very different relationships with founder and joiner interests. Most interestingly, our results suggest that preferences and context interrelate in unique ways to shape different entrepreneurial interests. In particular, an interest in being a founder is most strongly associated with individuals’ preferences for entrepreneurial job attributes, whereas contextual factors do little to shape a founder interest in individuals who lack these preferences. An interest in being a joiner, on the other hand, is associated with both preferences and context, and this relationship is most pronounced for individuals with preferences that predispose them toward entrepreneurship. This study highlights joiners as a distinct type of entrepreneurial actor and demonstrates the importance of considering the interplay between preferences and context in the study of entrepreneurship. This paper was accepted by David Hsu, entrepreneurship and innovation.