Homophily in Entrepreneurial Team Formation

Paul Gompers, Kevin Huang () and Sophie Calder-Wang
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Kevin Huang: Harvard Business School

No 17-104, Harvard Business School Working Papers from Harvard Business School

Abstract: We study the role of homophily in group formation. Using a unique dataset of MBA students, we observe homophily in ethnicity and gender increases the probability of forming teams by 25%. Homophily in education and past working experience increases the probability of forming teams by 17% and 11 % respectively. Homophily in education and working experience is stronger among males than females. Further, we examine the causal impact of homophily on team performance. Homophily in ethnicity increases team performance by lifting teams in bottom quantiles to median performance quantiles, but it does not increase the chance of being top performers. Our findings have implications for understanding the lack of diversity in entrepreneurship and venture capital industry.

Pages: 53 pages
Date: 2017-05
New Economics Papers: this item is included in nep-dcm, nep-ent and nep-net
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Working Paper: Homophily in Entrepreneurial Team Formation (2017)
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