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The workforce composition of young firms and product innovation: Complementarities in the skills of founders and their early employees

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  • Müller, Bettina
  • Murmann, Martin

Abstract

We investigate the extent to which complementarities between technical and business skills of founders and employees matter for the generation of market novelties by new ventures. Using data about German start-ups, we find that there are no complementarities between technical and business skills within the group of founders, but that there are significant complementarities between technically trained founders and employees who have business skills. This suggests that the innovation potential of start-ups by technically trained founders is best explored by hiring employees who are trained in business. However, a reverse relationship does not exist: There are no complementarities between founders with business skills and employees with technical skills.

Suggested Citation

  • Müller, Bettina & Murmann, Martin, 2016. "The workforce composition of young firms and product innovation: Complementarities in the skills of founders and their early employees," ZEW Discussion Papers 16-074, ZEW - Leibniz Centre for European Economic Research.
    • Handle: RePEc:zbw:zewdip:16074
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    Cited by:

    1. Zelenov, Mikhail (Зеленов, Михаил) & Kirin, Anatoly (Кирин, Анатолий) & Pobezhimova, Nelly (Побежимова, Нелли) & Yusupov, Vitaly (Юсупов, Виталий) & Agamagomedova, Seniyat (Агамагомедова, Сеният) & Gr, 2018. "Legislation on Administrative Procedures: Problems of Formation and Development Prospects [Законодательство Об Административных Процедурах: Проблемы Формирования И Перспективы Развития]," Working Papers 061821, Russian Presidential Academy of National Economy and Public Administration.

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    More about this item

    Keywords

    Entrepreneurship; Innovation; Human Capital; Skills; Complementarity;
    All these keywords.

    JEL classification:

    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
    • L23 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Organization of Production
    • L26 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Entrepreneurship
    • M13 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Administration - - - New Firms; Startups
    • M51 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Personnel Economics - - - Firm Employment Decisions; Promotions
    • Q31 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Nonrenewable Resources and Conservation - - - Demand and Supply; Prices

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