Bridging Strategic Human Capital and Employee Entrepreneurship Research: A Labor Market Frictions Approach

Campbell, Ben; Kryscynski, David; Olson, Daniel

doi:10.1002/sej.1264

Cited by 70 publications

(49 citation statements)

References 103 publications

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“…Second, our focus on necessity entrepreneurship can be viewed as a natural extension to the growing literature on employee entrepreneurship (e.g., Agarwal et al, 2004;Campbell et al, 2017;Ganco, 2013;Klepper & Sleeper, 2005). Entrepreneurs coming from the ranks of the short-term unemployed may not be too different from entrepreneurs who launch their ventures from their employed position.…”

Section: Theoretical Implicationsmentioning

confidence: 99%

Necessity entrepreneurship and industry choice in new firm creation

Nikiforou

Dencker

Gruber

2019

Strategic Management Journal

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Research Summary Research on necessity entrepreneurship has generated important insights, yet it views necessity entrepreneurs in developed countries as one encompassing group of unemployed individuals—ignoring that the level of need is not uniform but instead increases with time spent in unemployment. We begin to unpack the role of unemployment duration in necessity entrepreneurship by asking how it affects one of the most fundamental decisions in start‐ups: “what business should I be in?” Analyzing primary data on 576 necessity entrepreneurs combined with three secondary data sets, we find that unemployment duration affects whether ventures are launched in “home” or in external industries, and moderates the extent to which founders' industry experience and the attractiveness of external opportunities relative to those in the “home” industry shape industry choice. Managerial Summary Necessity entrepreneurs—individuals who create new firms because they have no other options for work—represent a substantial proportion of world‐wide entrepreneurial activity, and, in developed countries, often come from the ranks of the unemployed. We analyze these entrepreneurs by answering the question “what business should I be in?,” a fundamental strategic decision that founders make. Our findings reveal that duration in unemployment is a key, hitherto unexamined factor that systematically affects the industry‐choice decision in startups. Moreover, we find that duration of unemployment moderates the founder's industry experience and the attractiveness of external opportunities relative to those in the “home” industry, with a markedly different picture for the long‐term unemployed—suggesting the need for customized government policies for formerly unemployed entrepreneurs.

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Section: Theoretical Implicationsmentioning

confidence: 99%

Necessity entrepreneurship and industry choice in new firm creation

Nikiforou

Dencker

Gruber

2019

Strategic Management Journal

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“…First, the labour market friction mechanism (Campbell et al, 2017). Higher levels of employment protection lead to greater friction upon the labour market, lowering the probability that employers hire (and fire) employees and increasing the probability that employers contract self-employed labour.…”

Section: Theory and Hypothesesmentioning

confidence: 99%

Employment protection legislation and entrepreneurial activity

Liebregts

Stam

2019

International Small Business Journal

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Labour market institutions enable and constrain individual behaviour on the labour market and beyond. We investigate two main elements of national employment protection legislation and their effects upon entrepreneurial activity. We use multilevel analyses to estimate the separate impact of redundancy payments and the notice period for employers on independent entrepreneurship (self-employment) and entrepreneurial employee activity. Redundancy payments and notice period reflect labour market friction, opportunity cost, search time and liquidity constraint mechanisms contained in employment protection legislation. Country-level legislation on the notice period for employers is found to be positively related to an individual‘s involvement in entrepreneurial employee activity, yet negatively related to self-employment. We do not find consistent effects of redundancy pay legislation on entrepreneurial activity.

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“…However, some studies suggest that a lack of fit and frictions in the employee‐employer relationship is an important antecedent of mobility to new ventures (Campbell, Kryscynski, & Olson, ). For example, inventors can voluntarily choose to leave an incumbent firm to start their own firms due to differences in innovation agendas and disagreements about how to capture emerging innovation‐ and market‐related opportunities (Agarwal et al, ).…”

Section: Theoretical Backgroundmentioning

confidence: 99%

Tapping into the knowledge of incumbents: The role of corporate venture capital investments and inventor mobility

Lorenzo

Vrande

2018

Strategic Entrepreneurship

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Research Summary: This article investigates the impact of corporate venture capital (CVC) investments and inventors' mobility on the extent to which new ventures use incumbents' knowledge resources as inputs for their innovation activities. Our findings suggest that ventures receiving CVC investments draw less on investors' knowledge, while inventor mobility increases the extent to which an incumbent's technological knowledge is used by recipient ventures. Ventures combining CVC investments and inventor mobility from the same incumbent are selected for drawing less on that incumbent's patents, but these citation flows increase in the period after investment and the inventors' hiring events are combined. Our results, thus, unveil the organizational complexity associated with the individual and combined roles of CVC investments and inventor mobility in determining new ventures' innovation behaviors. Managerial Summary: New ventures often acquire resources from large established firms to foster development and success. Among others, research has primarily focused on equity investmentscorporate venture capital and the hiring of employees-in particular inventors. While prior work has studied the impact of these two resources in terms of success and performance, we look more specifically at whether these two particular resources, individually and combined, could function as channels through which new ventures can access and use established firms' knowledge assets. Our analyses suggest that ventures receiving CVC investments draw less on investors' knowledge, while those hiring inventors draw more. Ventures combining these resources show an increased use of the incumbent firm's knowledge assets in the period after investment and hiring are combined. K E Y W O R D S corporate venture capital, inventor mobility, knowledge flows, new ventures, patents

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Bridging Strategic Human Capital and Employee Entrepreneurship Research: A Labor Market Frictions Approach

Cited by 70 publications

References 103 publications

Necessity entrepreneurship and industry choice in new firm creation

Necessity entrepreneurship and industry choice in new firm creation

Employment protection legislation and entrepreneurial activity

Tapping into the knowledge of incumbents: The role of corporate venture capital investments and inventor mobility

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