Olav Sorenson: Do Startups Create Good Jobs?


Monday, October 24, 2016, 12:00pm to 1:45pm


Harvard Kennedy School: Allison Dining Room

Olav SorensonFrederick Frank '54 and Mary C. Tanner Professor of Management, Yale School of Management.

Olav SorensonWe analyze Danish registry data from 1991 to 2006 to determine how firm age and size influence wages. Unadjusted statistics suggest that smaller firms pay less than larger ones and that firm age has no bearing on wages. After adjusting for differences in the characteristics of employees hired by these firms, however, we observe both firm age and firm size effects.

We find that larger firms pay more than smaller firms for observationally-equivalent individuals but, contrary to conventional wisdom, that younger firms pay more than older firms. Moreover, we find that size effect dominates the age effect. Thus, while the typical startup—being both young and small—pays less than a more established employer, those that grow rapidly pay a wage premium.

View paper

About the speaker

Olav Sorenson is currently the Frederick Frank ’54 and Mary C. Tanner Professor of Management and Director of the Core Curriculum at the Yale School of Management, and Professor of Sociology (by courtesy), at Yale University, where he teaches electives on entrepreneurial finance and venture capital, as well as modules on strategy, innovation and organization design.

His primary stream of research pertains to economic geography, focusing on how entrepreneurship influences the growth and competitiveness of regions within countries. In particular, he has called attention to some of the unexpected consequences of the fact that social capital plays an important role in entrepreneurial success. Sorenson's most recent projects within this stream have been examining whether the availability of venture capital influences regional entrepreneurship and economic growth, and how going to work for a startup affects the future careers of employees.

Sorenson's secondary streams of research have been on the relationships between basic science and innovation and on how organizations can better learn from their interactions with customers and from their manufacturing experience. In total, he has delivered more than 300 research presentations and has had more than 60 papers published on these subjects, in journals such as the American Journal of Sociology, the American Sociological Review, the Review of Economics and StatisticsAdministrative Science QuarterlyManagement Science, the Strategic Management Journal, and Research Policy.

Learn more: www.olavsorenson.net


See also: Fall 2016