Does Individual Performance Affect Entrepreneurial Mobility? Empirical Evidence from the Financial Analysis Market
Our paper contributes to the studies on the relationship between workers' human capital and their decision to become self-employed as well as their probability to survive as entrepreneurs. Analysis from a panel data set of research analysts in investment banks over 1988-1996 reveals that star analysts are more likely than non-star analysts to become entrepreneurs. Furthermore, we find that ventures started by star analysts have a higher probability of survival than ventures established by non-star analysts. Extending traditional theories of entrepreneurship and labor mobility, our results also suggest that drivers of turnover vary by destination: (a) turnover to entrepreneurship and (b) other turnover. In contrast to turnover to entrepreneurship, star analysts are less likely to move to other firms than non-star analysts.
We would like to thank George Baker, Adam Brandenburger, Robert Gibbons, Jerry Green, Paul Healy, Josh Lerner, Jackson Nickerson, Nitin Nohria, Thomas Hellmann, Scott Stern, and Ezra Zuckerman as well as participants of the conferences/seminars at 2007 NBER JEMS Entrepreneurship conference, 2007 Utah-BYU Winter Strategy Conference, Columbia Business School, Harvard Business School, MIT, Stanford Business School, and University of Pennsylvania. Our gratitude to professionals at Goldman Sachs, Institutional Investor magazine, Lehman Brothers, Merrill Lynch, and Sanford C. Bernstein for interviews and comments on previous drafts. We also wish to thank Kathleen Ryan and James Schorr for research assistance. We gratefully acknowledge the Division of Research at the Harvard Business School for providing financial support for this study. The views expressed herein are those of the author(s) and do not necessarily reflect the views of the National Bureau of Economic Research.
Does individual performance affect entrepreneurial mobility Empirical evidence from the financial analysis market Boris Groysberg (firstname.lastname@example.org), Ashish Nanda (email@example.com) and M Julia Prats (firstname.lastname@example.org) Additional contact information Journal of Financial Transformation, 2009, vol. 25, pages 95-106