Does Working at a Start-Up Pay Off?

Daniel Fackler (), Lisa Hölscher (), Claus Schnabel and Antje Weyh ()
Additional contact information
Daniel Fackler: IWH Halle
Lisa Hölscher: Halle Institute for Economic Research
Antje Weyh: Institute for Employment Research (IAB), Nuremberg

No 13033, IZA Discussion Papers from Institute of Labor Economics (IZA)

Abstract: Using representative linked employer-employee data for Germany, this paper analyzes short- and long-run differences in labor market performance of workers joining startups instead of incumbent firms. Applying entropy balancing and following individuals over ten years, we find huge and long-lasting drawbacks from entering a start-up in terms of wages, yearly income, and (un)employment. These disadvantages hold for all groups of workers and types of start-ups analyzed. Although our analysis of different subsequent career paths highlights important heterogeneities, it does not reveal any strategy through which workers joining start-ups can catch up with the income of similar workers entering incumbent firms.

Keywords: wages; young firms; startups; linked employer-employee data (search for similar items in EconPapers)
JEL-codes: J31 J63 L26 M51 (search for similar items in EconPapers)
Pages: 39 pages
Date: 2020-03
New Economics Papers: this item is included in nep-ent, nep-hrm and nep-lma
References: View references in EconPapers View complete reference list from CitEc
Citations:

Published - published in: Small Business Economics, 2022, 58 (4), 2211-2233

Downloads: (external link)
https://docs.iza.org/dp13033.pdf (application/pdf)

Related works:
Journal Article: Does working at a start-up pay off? (2022)
Working Paper: Does working at a start-up pay off? (2020)
Working Paper: Does working at a start-up pay off? (2020)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:iza:izadps:dp13033

Ordering information: This working paper can be ordered from
IZA, Margard Ody, P.O. Box 7240, D-53072 Bonn, Germany

Access Statistics for this paper

More papers in IZA Discussion Papers from Institute of Labor Economics (IZA) IZA, P.O. Box 7240, D-53072 Bonn, Germany. Contact information at EDIRC.
Bibliographic data for series maintained by Holger Hinte ().