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What Makes an Employer?

Author

Listed:
  • Caliendo, Marco

    () (University of Potsdam)

  • Fossen, Frank M.

    () (University of Nevada, Reno)

  • Kritikos, Alexander S.

    () (DIW Berlin)

Abstract

As the policy debate on entrepreneurship increasingly centers on firm growth in terms of job creation, it is important to better understand which variables influence the first hiring decision and which ones influence the subsequent survival as an employer. Using the German Socioeconomic Panel (SOEP), we analyze what role individual characteristics of entrepreneurs play in sustainable job creation. While human and social capital variables positively influence the hiring decision and the survival as an employer in the same direction, we show that none of the personality traits affect the two outcomes in the same way. Some traits are only relevant for survival as an employer but do not influence the hiring decision, other traits even unfold a revolving door effect, in the sense that employers tend to fail due to the same characteristics that positively influenced their hiring decision.

Suggested Citation

  • Caliendo, Marco & Fossen, Frank M. & Kritikos, Alexander S., 2019. "What Makes an Employer?," IZA Discussion Papers 12742, Institute of Labor Economics (IZA).
  • Handle: RePEc:iza:izadps:dp12742
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    Keywords

    employer; entrepreneurship; business venturing; recruitment; firm growth; employment growth; personality;

    JEL classification:

    • J22 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Time Allocation and Labor Supply
    • J23 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Labor Demand
    • L26 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Entrepreneurship

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