Research Summary
To grow, startup ventures often require the skills of professional managers familiar with running larger organizations. However, risk considerations may discourage such candidates ...from departing high‐paying, stable jobs. Interpreting the manager's decision within a household holding a “portfolio” of jobs, we hypothesize that having a spouse whose career is prioritized mitigates risk as a barrier to joining a startup. Survey data corroborate that both men and women with a career‐prioritized spouse are less likely to report risk as a barrier. However, having a career‐prioritized spouse only translates to a greater interest in startup employment among men. Our findings have implications for understanding the challenges startup ventures face when attracting managerial talent, how dual careers and gender affect managers' careers, and regional entrepreneurial ecosystems.
Managerial Summary
Using survey data from professional managers working in corporate headquarters, we show that being in a dual‐career household increases one's willingness and lowers the perceived risk of leaving their job and joining a startup venture—especially if the household prioritizes their spouse's career. However, the increased willingness to join a startup in households that prioritize their spouse's career is only manifest for men. These findings highlight how dual‐career households can be a talent source for startup ventures and suggest that regions with greater concentrations of dual‐career households might be especially advantageous for startup ventures. Nevertheless, our results also suggest that gender norms are an impediment for dual‐career women when considering employment in startup ventures.
We study how firms’ personnel practices react to labor market regulation. While a company is compelled to comply with a new law, what is the ripple effect of the change on existing personnel policies ...and practices? We provide evidence using passage of the Age Discrimination in Employment Act and nearly two decades of administrative data from a large US firm. In line with theory, we find a weakening of long-term implicit incentives and movement toward pay for performance. Furthermore, the data are consistent with the firm carefully managing its personnel practices according to economic principles to preserve incentives for employees.
Group-based incentives are attractive in contexts where production is interdependent. Prior work shows such incentives increase group performance despite freeriding concerns, yet little is known ...about the effort response of individuals. Using individual-level data, the authors assess the introduction of group-based performance pay using difference-in-difference estimation. Overall, performance increased by 19%. Nearly all workers contributed to this effect. Further, two-thirds of this effect stems from increased efficiency (more output per unit of time) and one-third from higher attendance. Both incentive and selection effects are present. By leveraging individual-level data, the authors pose new questions and evidence to the group-based incentives literature.
We conduct a randomized controlled trial to understand how a web-based retirement saving calculator affects workers' retirement-savings decisions. In both the treatment and active control conditions, ...the calculator projects workers' retirement income goal. In the treatment condition only, it also projects retirement income based on defined-contribution savings, prominently displays the gap between projected goal and actual retirement income, and allows users to interactively explore how alternative, future contribution choices would affect the gap. The treatment increased average annual retirement contributions by $174 (2.3 percent). However, effects were larger for those with higher measures of financial knowledge, suggesting this type of tool complements, rather than substitutes for, underlying financial capability.
In a nationally representative sample, we predict retirement savings using survey‐based elicitations of exponential‐growth bias (EGB) and present bias (PB). We find that EGB, the tendency to neglect ...compounding, and PB, the tendency to value the present over the future, are highly significant and economically meaningful predictors of retirement savings. These relationships hold controlling for cognitive ability, financial literacy, and a rich set of demographic controls. We address measurement error as a potential confound and explore mechanisms through which these biases may operate. Back of the envelope calculations suggest that eliminating EGB and PB would increase retirement savings by approximately 12%. (JEL D91, D14)
We examine the relationships between work-to-family conflict, time allocation across work activities, and the outcomes of work satisfaction, well-being, and salary in the context of self-regulation ...and self-discrepancy theories. We posit work-to-family conflict is associated with self-discrepant time allocation such that employees with higher levels of work-to-family conflict are likely to allocate less time than preferred to work activities that require greater self-regulatory resources (e.g., tasks that are complex, or those with longer term goals that delay rewards and closure) and allocate more time than preferred to activities that demand fewer self-regulatory resources or are replenishing (e.g., those that provide closure or are prosocial). We suggest this self-discrepant time allocation (actual vs. preferred time allocation) is one mechanism by which work-to-family conflict leads to negative employee consequences (Allen, Herst, Bruck, & Sutton, 2000; Mesmer-Magnus & Viswesvaran, 2005). Using polynomial regression and response surface methodology, we find that discrepancies between actual and preferred time allocations to work activities negatively relate to work satisfaction, psychological well-being, and physical well-being. Self-discrepant time allocation mediates the relationship between work-to-family conflict and work satisfaction and well-being, while actual time allocation (rather than the discrepancy) mediates the relationship between work-to-family conflict and salary. We find that women are more likely than men to report self-discrepant time allocations as work-to-family conflict increases.
We examine the effects of the COVID‐19 pandemic on faculty using survey data. First, we uncover heterogeneity in the immediate effects on research productivity and burnout. Three groups emerged ...(Career Accelerated, Career Insulated, and Career Headwinds) with female faculty disproportionately represented in Career Headwinds, experiencing both high burnout and declines in research productivity. Second, we examine how greater caregiving demands at home and at work—in the form of institutional service—contribute to gender differences. We find female faculty reported greater increases in service demands, and these exerted greater drag on their careers through a larger crowd out of research time.
Many investment companies have begun providing their defined-contribution pension participants with individualized, retirement income projections. The U.S. Congress is currently considering whether ...to require them all to do so. Evidence on the potential impact is scant, though a large body of economic research suggests that individuals are not currently making optimal retirement-saving decisions. Through a field experiment, we measure how provision of retirement income projections along with enrollment information affects individuals' contributions to employer-sponsored retirement accounts. We find that the intervention boosted annual contributions to employer retirement accounts by $85, equivalent to 3.6% of the average contribution level or 0.15% of average salary, relative to those who received no intervention. In addition, randomly-assigned assumptions regarding retirement age, investment returns, and hypothetical contribution amounts were used to generate the projections and were found to have significant impacts on saving behavior. This finding suggests that care is warranted in the design and communication of projections.
•Retirement-income projections affect employee contributions to savings accounts.•Effect on contributions was modest, equivalent to 0.15% of average salary.•Effect on contributions was sensitive to assumptions used to construct projections.•Care is warranted in the design and communications of income projections.
We evaluate the relationships among breadwinner role, performance, and pay. Differences in pay are present despite limited differences in performance. We find a pay premium for primary‐breadwinner ...employees across gender, yet a pay penalty for secondary‐breadwinners employees only for women, suggesting an asymmetric relationship among breadwinner role, gender, and pay.
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