Does Entrepreneurship Experience Help or Hurt Searches for Technology Sector Jobs? Evidence from Randomized Experiments

Abstract

While extant research has shown entrepreneurial activities and their returns are unequally distributed among majority and minority groups, little is known about career trajectories after the entrepreneurial event and whether the bias against minority groups continues. For example, in technology-intensive labor market, entrepreneurial experiences are common, more so for male than for female. Because new ventures commonly fail, founders move on to look for jobs in the regular labor market; yet, we have only limited information about the continuation of bias against the minority groups (e.g. female entrepreneurs) in the labor market post-entrepreneurship. This paper utilizes a field experimental approach to answer the following questions. First, what effect does entrepreneurship experience have on an individual’s wage-labor market outcome? Second, does any entrepreneurship-experience effect on wage-labor market differ for men and women? Third, do these effects vary with types of employers? An audit study and a vignette-based experimental study have been conducted to answer these questions. In the audit field experiment conducted at an online job marketplace, we find that job applicants do not seem to be penalized by having entrepreneurship experience, and that there is no statistically significant difference between the genders in the effect of entrepreneurship experience on getting a hiring contact. However, from a vignette-based experimental study with recruited managers tasked with hiring a candidate from resumes provided to them by the researchers, the effect of entrepreneurship experience and gender on hiring attractiveness may be interpreted differently based on certain characteristics of the recruiters. Participating recruiters who are male, younger than age 45, located in urban and entrepreneurial hub areas, with weak entrepreneurship intentions and working at larger firms turn out to be the main force driving the entrepreneurship-experience penalty. In contrast, recruiters who are female, older than 45, with strong entrepreneurship intentions, located in non-urban areas and not near entrepreneurial hub areas, and working for smaller firms are indifferent to job candidate with or without entrepreneurship experience.