How Do Organizations Shape Entrepreneurship? Explaining Employee Entrepreneurs' Entry and Performance

Yang, Tiantian

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March 19, 2019

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Yang, Tiantian
- Affiliation: College of Arts and Sciences, Department of Sociology

Abstract

My three-essay dissertation consists of three independent chapters that examine how two major institutions, organizations and family, shape entrepreneurship in Sweden. Viewing entrepreneurs as organizational products (Freeman 1986; Stinchcombe 1965), contextual accounts of entrepreneurship have theorized work environments as one of the most important settings explaining individuals' transitions to entrepreneurship (Sørensen and Fassiotto 2011; Sørensen 2007; Dobrev and Barnett 2005). Empirical findings have shown that the vast majority of entrepreneurs discover startup opportunities at their wage jobs in established organizations (Hellmann 2007; Klepper and Sleeper 2005; Agarwal et al. 2004; Klepper 2001). In addition to work environments, family is another social context in which most new businesses are founded. In post-industrial societies where profound social changes in labor market and employment have led to dramatic increases in dual-earner couples, family households have become increasingly important in shaping entrepreneurial processes (Western et al. 2008; Curtis 1986). Thus I examine the joint effects of work environments and family households on entrepreneurial processes - entrepreneurial entry and business outcomes. The three chapters are organized as follows: In chapter one, I frame a contingent approach to social influence on entrepreneurship and empirically test the specifications about the contingencies. I first conceptualize entrepreneurship as a process of discovering and pursuing startup opportunities, I then theorize the conditions that amplify or reduce peer influence on entrepreneurship. In chapter two, I investigate the question of under what conditions spousal couples leave their wage jobs to become co-entrepreneurs. Whereas some spousal couples jointly create new business together, others may decide to have one person becoming an entrepreneur while the other person remaining employed in an established organization. Two theoretical models, one economic, the other sociological, have provided different explanations of the heterogeneity of spousal couples' joint entrepreneurial statues. I distinguish between the two competing theoretical accounts by investigating wives and husbands' transitions into entrepreneurship, taking into account their separate employment in the labor market and their joint household conditions. My results suggest that women's chances to become entrepreneurs are constrained by their limited access to entrepreneurial peers at workplaces. Meanwhile, the differential effects of work peers on men and women's exposures to information on and skills for creating startups are substantially moderated by family conditions. Three family conditions are particularly important: men's dominance in spousal relationships, the relative comparative advantage of spousal couples' earnings, and the presence of children in the households. In chapter three, I investigate how founders and their recruited employees jointly create new businesses, contingent on the founding context of new businesses. I argue that an important dimension of developing routines and delineating boundaries is manifest in entrepreneurs' selections of employees from their local labor markets (Scott 2008). Once recruited, employees join the founders to create new organizations and exert influences on organizations' structures and performances. Even though entrepreneurs largely follow the blueprints they learned from prior employer organizations to recruit employees, the effects of transferring routines may be contingent on the founding conditions surrounding the new businesses.

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