Department of Management

Whom do new firms hire?

Research output: Contribution to journal/Conference contribution in journal/Contribution to newspaperJournal articleResearchpeer-review

Standard

Whom do new firms hire? / Dahl, Michael S.; Klepper, Steven.

In: Industrial and Corporate Change, Vol. 24, No. 4, dtv026, 01.08.2015, p. 819-836.

Research output: Contribution to journal/Conference contribution in journal/Contribution to newspaperJournal articleResearchpeer-review

Harvard

Dahl, MS & Klepper, S 2015, 'Whom do new firms hire?', Industrial and Corporate Change, vol. 24, no. 4, dtv026, pp. 819-836. https://doi.org/10.1093/icc/dtv026

APA

Dahl, M. S., & Klepper, S. (2015). Whom do new firms hire? Industrial and Corporate Change, 24(4), 819-836. [dtv026]. https://doi.org/10.1093/icc/dtv026

CBE

Dahl MS, Klepper S. 2015. Whom do new firms hire?. Industrial and Corporate Change. 24(4):819-836. https://doi.org/10.1093/icc/dtv026

MLA

Dahl, Michael S. and Steven Klepper. "Whom do new firms hire?". Industrial and Corporate Change. 2015, 24(4). 819-836. https://doi.org/10.1093/icc/dtv026

Vancouver

Dahl MS, Klepper S. Whom do new firms hire? Industrial and Corporate Change. 2015 Aug 1;24(4):819-836. dtv026. https://doi.org/10.1093/icc/dtv026

Author

Dahl, Michael S. ; Klepper, Steven. / Whom do new firms hire?. In: Industrial and Corporate Change. 2015 ; Vol. 24, No. 4. pp. 819-836.

Bibtex

@article{e810573a2fc2436eb25fceb3e76b94a2,
title = "Whom do new firms hire?",
abstract = "Using the matched employer-employee data set for Denmark and information on the founders of new firms, we analyze the hiring choices of all new firms that entered from 2003 to 2010. We develop a theoretical model in which the quality of a firm's employees determines its average cost, a firm's productivity is based on its pre-entry experience and persistent shocks, and over time firms learn about their productivity. The model predicts that more productive firms are larger and hire more talented employees, which gives rise to various predictions about how pre-entry experience, firm growth rates, and firm size influence the wages firms pay to their early hires. We find that beginning with the time of entry, larger firms consistently pay higher wages to their new hires. These are firms with greater survival prospects at the time of entry based on the pre-entry backgrounds of their founders and that grow at greater rates over time, both of which are predictive of the wages paid to new hires from the time of entry onward. Our findings suggest workers are allocated to firms according to their abilities, which can give rise to enduring firm capabilities.",
author = "Dahl, {Michael S.} and Steven Klepper",
year = "2015",
month = aug,
day = "1",
doi = "10.1093/icc/dtv026",
language = "English",
volume = "24",
pages = "819--836",
journal = "Industrial and Corporate Change",
issn = "0960-6491",
publisher = "Oxford University Press",
number = "4",

}

RIS

TY - JOUR

T1 - Whom do new firms hire?

AU - Dahl, Michael S.

AU - Klepper, Steven

PY - 2015/8/1

Y1 - 2015/8/1

N2 - Using the matched employer-employee data set for Denmark and information on the founders of new firms, we analyze the hiring choices of all new firms that entered from 2003 to 2010. We develop a theoretical model in which the quality of a firm's employees determines its average cost, a firm's productivity is based on its pre-entry experience and persistent shocks, and over time firms learn about their productivity. The model predicts that more productive firms are larger and hire more talented employees, which gives rise to various predictions about how pre-entry experience, firm growth rates, and firm size influence the wages firms pay to their early hires. We find that beginning with the time of entry, larger firms consistently pay higher wages to their new hires. These are firms with greater survival prospects at the time of entry based on the pre-entry backgrounds of their founders and that grow at greater rates over time, both of which are predictive of the wages paid to new hires from the time of entry onward. Our findings suggest workers are allocated to firms according to their abilities, which can give rise to enduring firm capabilities.

AB - Using the matched employer-employee data set for Denmark and information on the founders of new firms, we analyze the hiring choices of all new firms that entered from 2003 to 2010. We develop a theoretical model in which the quality of a firm's employees determines its average cost, a firm's productivity is based on its pre-entry experience and persistent shocks, and over time firms learn about their productivity. The model predicts that more productive firms are larger and hire more talented employees, which gives rise to various predictions about how pre-entry experience, firm growth rates, and firm size influence the wages firms pay to their early hires. We find that beginning with the time of entry, larger firms consistently pay higher wages to their new hires. These are firms with greater survival prospects at the time of entry based on the pre-entry backgrounds of their founders and that grow at greater rates over time, both of which are predictive of the wages paid to new hires from the time of entry onward. Our findings suggest workers are allocated to firms according to their abilities, which can give rise to enduring firm capabilities.

U2 - 10.1093/icc/dtv026

DO - 10.1093/icc/dtv026

M3 - Journal article

AN - SCOPUS:84939535969

VL - 24

SP - 819

EP - 836

JO - Industrial and Corporate Change

JF - Industrial and Corporate Change

SN - 0960-6491

IS - 4

M1 - dtv026

ER -