A study of impending derailment and recovery of middle managers across career stages

Why do some fast‐track managers derail? Why do some recover and return to the fast track? This study investigates these questions by analyzing managerial skills and self‐awareness during different career stages. The results suggest that derailers have significantly lower skill profiles than do successful managers at all career stages. The study also identifies specific skills that managers need to be successful in their careers; furthermore, it reports that derailers overestimate their skills in comparison to successful managers at all career stages. The results imply that one can avoid derailment or recover from derailment by developing both self‐awareness and specific managerial skills. © 2000 John Wiley & Sons, Inc.     

RETURN TO EXPERIENCE AND INITIAL WAGE LEVEL: DO LOW WAGE WORKERS CATCH UP?

This paper estimates the relationship between initial wage and return to experience. We use a Mincer‐like wage model to non‐parametrically estimate this relationship allowing for an unobservable individual permanent effect in wages and unobservable individual return to experience. The relationship between return to experience and unobservable individual ability is negative when conditioning on educational attainment, while the relationship between return to experience and educational attainment is positive. We link our findings to three main theories of wage growth, namely search, unobserved productivity and learning, and human capital. We devise several empirical tests in order to separate the theories. We find evidence in favor of the unobserved productivity and learning model and mixed evidence regarding the search model. We find no evidence in support of the human capital model. Copyright © 2013 John Wiley & Sons, Ltd.     

East–West migration and gender: Is there a differential effect for migrant women?

This paper examines whether female East–West migrants in Germany face a differential effect on their labor market outcomes after they move compared to both males and stayers. It builds on a “difference-in-difference-in-difference” approach, employs a matching procedure to define the corresponding before and after periods for movers and stayers and uses panel data techniques to difference away time-invariant unobservable confounders. I find that migrant women after migration do not experience significantly different earnings or employment prospects, compared to migrant males and female stayers. They do, however, face an additional negative effect on hours worked and on annual income. The results also suggest that for them, the income effect seems to dominate the substitution effect and they substitute some market work in the West with home production, in particular, with childcare.     

The effects of certification on total factor productivity: A propensity score matching approach

The primary purpose of this study is to investigate the impact of quality certification on total factor productivity, which is unobservable to and difficult to gauge for firms. To do so, we implement various propensity score matching estimators that handle the self‐selection problem. We use firm‐level data on manufacturing companies in Turkey where firms have devoted significant amounts of resources to get certified. Our findings show that certification does not have any positive effect on total factor productivity. We provide potential explanations for these findings.     

Entrepreneurship and Post‐socialist Growth*

We use a rich regional data set to obtain a statistical characterization of the relationship between entrepreneurial activity and economic growth within post‐Soviet Russia. Russia is a useful laboratory for evaluating links between entrepreneurial activity and growth because of the striking variation in initial conditions, the adoption of policy reforms, and entrepreneurial activity observed across its large number of regions in the early stages of transition. Russia has also experienced striking regional variation in subsequent growth. Conditional on variations in initial conditions and policy reform measures, regional entrepreneurial activity exhibits a statistically and quantitatively significant relationship with subsequent economic growth.     

How does heterogeneity shape the socioeconomic gradient in health satisfaction?

Individual heterogeneity plays a key role in explaining variation in self‐reported health and its socioeconomic gradient. It is hypothesised that the influence of this heterogeneity varies over levels of health and increases over the life cycle. These hypotheses are tested by applying a threshold‐specific alternative to the conditional fixed‐effects logit and longitudinal data from Germany. Our results suggest that income influences health at the lower end, but not at the higher end of the health distribution, once unobservable factors are controlled for. The underlying assumptions of the statistical model matter for this conclusion, in particular for the older age groups. Copyright © 2009 John Wiley & Sons, Ltd.     

Human resource practices and migrant workers' turnover intentions: The roles of post‐migration place identity and justice perceptions

This study adopts an identity perspective to explore the relationship between human resource (HR) practices and turnover intentions among migrant workers. Informed by HR attribution theory, we propose that the effects of HR practices will be more effective in reducing turnover among migrant workers when these workers have stronger post‐migration place identities and when they experience a sense of justice regarding their work and nonwork environments. Using a three‐way interaction model, we tested these ideas on a sample composed of 1,985 migrant workers in 141 firms in China. The results support the theoretical model.     

Age as double‐edged sword among victims of customer mistreatment: A self‐esteem threat perspective

Service workers are expected to maintain high‐quality service delivery despite customer mistreatment—the poor‐quality treatment of service workers by customers—which can be demeaning and threatening to self‐esteem. Although service work is increasingly delivered by middle‐aged and older workers, very little is known about how employees across the age range navigate abuse from customers on the job. Does advancing age help or hinder service performance in reaction to customer mistreatment? Drawing on strength and vulnerability integration theory, we proposed that age paradoxically both helps and hinders performance after customer mistreatment, albeit at different stages. We tested our proposed model in a two‐sample field investigation of service workers and their supervisors using a time‐lagged, dyadic design. Results showed that age heightens the experience of self‐esteem threat but, nevertheless, dampens reactions to self‐esteem threat, leading to divergent effects on performance at different stages. Implications for age and service work, as well as aging and the sense of self, are discussed.     

Risky Businesses? Young People in Informal Self‐Employment in Sofia

This article studies how perceptions of the risks associated with informal self‐employment depend on the interplay between the institutional, structural (network) and cultural embeddedness of economic action. Informal self‐employment should create at least three types of risk. The first concerns the possible legal and social sanctions that stem from the illegal character of the entrepreneurial action. The second is related to the complete lack of social security protection among those for whom informal self‐employment is their sole employment. The third is connected with the lack of guarantees concerning contract enforcement, which may increase the probability of opportunistic behaviour by business partners and clients. On the basis of a qualitative study of young, highly educated, informally self‐employed workers in Bulgaria's capital Sofia, I argue that these risks are compensated by the specific network and cultural embeddedness of the economic action. This compensation takes the form of various types of insurance against risks. Its core is the replacement of the vacuum of institutional‐system trust with interpersonal trust. Thus, the specific constellation of institutional, network and cultural embeddedness is able to solve the problem of opportunism, as well as to create the perception that the informally self‐employed are faced with not much greater risks than registered self‐employed workers.     

Migration and gender differences in the home labour market: Evidence from Albania

This paper examines the role of migration in affecting the labour market opportunities of male and female household members left behind. We address this question by analyzing the impact of international migration flows from Albania, where migration is a massive and male-dominated phenomenon. We find that the labour supply of men and women responds differently to current and past migration. Controlling for the potential endogeneity of migration, estimates show that having a migrant abroad decreases female paid labour supply while increasing unpaid work. On the other hand, women with past family migration experience are significantly more likely to engage in self-employment and less likely to supply unpaid work. The same relationships do not hold for men. These results suggest that while left-behind women in Albania may take on the extra burden associated with the migration of male family members, they gain employment opportunities upon their return.     

Race,Self‐Employment,and Labor Absorption

Past studies have argued that in the large cities of developing societies, unemployment is often alleviated when displaced workers are absorbed into the small‐scale entrepreneurial activities of the informal economy. The present study applies this argument to an analysis of women's self‐employment in the U.S. South during the Great Depression. Census data show that in large southern cities in 1940, the unemployment of black women was meaningfully reduced by the self‐employment of these women in domestic service. These data further suggest that dynamics of race, unemployment, and the self‐employment of women in domestic service can be represented by an inverted‐U‐shaped labor absorption curve. These results make several contributions to research on race, labor‐market disadvantage, and self‐employment in the informal sector.     

EURO CORPORATE BOND RISK FACTORS

This paper investigates the determinants of credit spread changes in euro‐denominated bonds. We adopt a factor model framework, inspired by the credit risk structural approach, as credit spread changes can be easily viewed as an excess return on corporate bonds over Treasury bonds. We try to assess the relative importance of market and idiosyncratic factors as an explanation of movements in credit spreads. We adopt a heterogeneous panel with a multifactor error model and propose a two‐step estimation procedure, which yields consistent estimates of unobserved factors. The analysis is carried out with a panel of monthly redemption yields on a set of corporate bonds for a time span of 3 years. Our results suggest that the euro corporate market is driven by observable and unobservable factors. The unobservable factors are identified through a consistent estimation of individual and common observable effects. The empirical results suggest that an unobserved common factor has a significant role in explaining the systematic changes in credit spreads. However, in contrast to evidence regarding US credit spread changes, it cannot be identified as a market factor. Copyright © 2011 John Wiley & Sons, Ltd.     

Retirement Choices in Italy: What an Option Value Model Tells Us*

Using Italian data, we estimate an option value model to quantify the effect of financial incentives on retirement choices. As far as we know, this is the first empirical study to estimate the conditional multiple‐years model put forward by Stock and Wise (1990) . This implies that we account for dynamic self‐selection bias. We also present an extended version of this model in which the marginal value of leisure is random. For the female sample, the model is able to predict almost perfectly the age‐specific hazard rates. For the male sample, we obtain a good fit. Dynamic self‐selection results in a downward bias in the estimate of the marginal utility of leisure. We perform a simulation study to gauge the effects of a dramatic pension reform. Underestimation of the value of leisure translates into sizeable over‐prediction of the impact of reform. Due to lack of data, results for males should be interpreted with caution since we are not able to fully correct for dynamic self‐selection bias.     

Entrepreneurial Leadership in the Context of Company Start‐Up and Growth

Starting a new business is easy. Leading a start‐up and transitioning from founder to CEO is hard. As a result, less than 1 in 25 new companies will grow to have 50 or more employees. This article examines three important challenges faced by entrepreneurial leaders at start‐up: developing a vision, achieving optimal persistence, and executing through chaos. The article also considers three capabilities needed by founders who seek to continue to lead their companies during the growth stage of the entrepreneurial process: strategic thinking, coaching, and self‐evaluation. The Siegfried Group, LLP, a leading national CPA firm that provides Leadership Advisory and Talent Delivery services to Fortune 1000 organizations, is used as a brief case study to illustrate key challenges and capabilities associated with entrepreneurial leadership.     

Negative Emotional Reactions to Project Failure and the Self-Compassion to Learn from the Experience

Project failure is likely to generate a negative emotional response for those involved in the project. But do all people feel the same way? And are some better able to regulate their emotions to learn from the failure experience? In this paper we develop an emotion framework of project failure that relies on self‐determination to explain variance in the intensity of the negative emotions triggered by project failure and self‐compassion to explain variance in learning from project failure. We discuss the implications of our model for research on entrepreneurial and innovative organizations, employees' psychological ownership, and personal engagement at work.     

Interregional Migration and Thresholds: Evidence from Spain

We analyse the effects of labour market factors on interregional migration in Spain for the period 1988–2010. A basic theoretical framework is developed, suggesting that the effect of labour market variables on migration varies, depending on a certain threshold. The model implications are tested using a new approach based on the presence of endogenous thresholds. We show that Spanish interregional migration can be explained by labour market variables when the labour market conditions at the source region are unfavourable relative to those of the host region. We test the results for several migrant characteristics, such as citizenship, the age range, and return migration.

Migration inter-régionale et seuils - résultats de la recherche en Espagne     

The effects of ambiguity on entrepreneurship

We incorporate ambiguity (Knightian uncertainty) into a classic model of entrepreneurship to analyze, among other things, its effects on the optimal level of business startups, the relation between total assets and the size of the entrepreneurial investment, the effects of increasing ambiguity on developing new ventures, and the decision to self‐select into entrepreneurship for an indifferent decision maker. We first show that, under the monotone‐likelihood ratio property, the introduction of ambiguity negatively affects the optimal entrepreneurial investment, something that is consistent with most experimental evidence about entrepreneurial choice under ambiguity. Then, we show that the classical explanations for the positive correlation between total assets and business startups based on decreasing absolute risk aversion preferences and prudent behavior can be challenged when ambiguity is incorporated into the analysis, and we provide the conditions that guarantee that the traditional comparative static result under risk is replicated under ambiguity. We also show that increases in ambiguity aversion reduce entrepreneurial activities. Finally, we discuss our results under alternative ways of modeling ambiguity.     

Venture Capital Investments in Europe and Portfolio Firms' Economic Performance: Independent Versus Corporate Investors

Using a new European Commission‐sponsored longitudinal dataset—the VICO dataset—we assess the impact of independent (IVC) and corporate venture capital (CVC) investments on the economic performance of European high‐tech entrepreneurial firms during the period 1992–2010. After controlling for potential sources of endogeneity and selection bias, our results indicate that both IVC and CVC investments boost portfolio firms' economic performance. These effects are mostly due to an increase in real sales value. Moreover, the dynamics of the impact of VC investments on firms’ overall economic performance and its components—real sales value, real fixed assets, and real labor costs—differs depending on the type of investor. Finally, we do not detect any impact related to the syndication of investments by both IVC and CVC investors.     

Labor market outcomes,savings accumulation,and return migration

In this paper, I examine the determinants of return migration from Germany for immigrants from four different source countries, and test the savings accumulation conjecture that is used to rationalize return migration decisions using both cross-country and time variation in purchasing power parity. The empirical results confirm the savings accumulation conjecture. Therefore, return migration can be seen as part of optimal life-cycle location choices in this context. I also examine how labor market outcomes influence return decisions. A key finding here is that unlike previous studies, which find a positive impact of unemployment on return migration, I find that the direction of the impact of unemployment changes by the spell length.     

The Importance of Attributes in Entrepreneurial Opportunity Evaluations: An Emerging Market Study

Although prior research has established that entrepreneurs have idiosyncratic perceptions about opportunity attributes, we do not yet understand the level of importances attached to attributes when evaluating opportunities. This article uses conjoint analysis to assess how trade‐offs are decided when evaluating opportunities considering both individual and business criteria. We hypothesize differences in the perceived importances of opportunities and the unique constellations therein. The results indicate that there is a significant difference in the degree of importance attached to the business sector, capital intensity, technology maturity, market potential and return on investment potential, when individuals evaluate an entrepreneurial opportunity. The business sector was identified as the principal determinant of opportunity attractiveness, followed closely by the market growth rate, which reflects emerging market conditions. By contextualizing the findings, it is suggested that emerging economies impose higher bureaucratic burdens on entrepreneurs, increasing uncertainty as well as operational and transactions costs of firms; therefore, reducing the incentive to invest in capital or technology. Copyright © 2013 John Wiley & Sons, Ltd.