Employees in small, young firms have roughly 15% higher rates of divorce
Couples with job alignment have lower divorce hazards
Additional alignment advantage for couples with startup jobs
Startups and divorce
Young ventures function as hotbeds of divorce
with Michael S. Dahl and Olav Sorenson
We argue for an organizational perspective on the relationship between professional and personal lives, proposing in particular that more stable organizations, those characterized by higher levels of bureaucracy, engender lower levels of marital instability among their employees. Consistent with this expectation, we find that startup employees have higher divorce rates compared to the employees of more established organizations. These results hold even when estimated using instrumental variables to account for selection into startup employment. But couple matching also matters. Couples in which both individuals work for startups – even if different ones – have some of the lowest levels of divorce.
Read the working paper (09/2019 version) here. For a more recent version, please get in touch.
CEO divorce and firm operating performance
Divorce has economic ramifications
with Ingo Kleindienst, Kaleb Abreha, Denis Schweizer, and Juliane Proelss
We examine how CEO divorce affects firm operating performance. To this end, we use population-level data of CEOs in Denmark over the 2000-2012 sample period. Applying a difference-in-differences research design, we study matching pairs of firms with married and divorcing CEOs. We find that CEO divorce is associated with significant underperformance — as measured by operating ROA (OROA) and industry-adjusted OROA — but only under specific circumstances: in small firms, in high-growth industries, when children are present in the CEO household, and when the income difference between the CEO and spouse is high. Overall, in addition to social implications, we find that CEO divorce can have significant economic ramifications for firms..
The paper is forthcoming at the Academy of Management Discoveries.
CEO divorce lowers firm performance
Network tension as conjuncture of dyadic collaborations
Link between network tension and six measures of innovative performance
Network tension and innovation in teams
Network tension predicts creative team success more so than brokerage
with Balázs Vedres
Tension has been shown to help teams succeed in non-routine tasks, but no large-scale analysis of creative tension in teams exists to date. We operationalize tension in a large-scale team network dataset as open and strong relationships, and we show that these contribute to success in jazz recording sessions. We develop two graph level measures to capture tension in open and strong triads as the relative frequency and the strength of such structures. Our data comes from the comprehensive history of jazz with 158,537 recording sessions from the period of 1896 to 2010. Our results show that in recorded jazz music—a uniquely synergistic domain of collective creativity—tension is more prevalent than expected by a multipartite configuration model. Tension is a consistent and robust predictor of several success measures, including deep success where diverse measures of success are coinciding. We also measure the structural availability of tension to each session based on our computational null model and show that unexpected tension (where musicians went beyond chance availability of strong open triads to bring imbalance into their bands) has an additional contribution to deep success. We discuss implications for creative teams and organizations where collective innovation is crucial. .
Read the working paper (03/2021 version) on SocArXiv.
When positional advantage backfires: How social buffering halts positional advantage
Wholesalers able to leverage positional strategies locally can overcome relationship lock-in
with Ingo Kleindienst
A fundamental assumption in the strategy field is that competitive advantage is beneficial or at least not harmful to the firm possessing it. Building on recent work that highlights that competitive advantage may—under certain conditions—backfire, we explore when and how prior commitments may halt positional advantage. We introduce the concept of social buffering to highlight the embeddedness of organizations in the history of their relationships and argue that firms are severely limited in acting on their positional advantage under high levels of social buffering. We empirically investigate our theory using the U.S. beer distribution industry. We use longitudinal data on beer distributors and the county-level composition of their portfolios between 1997 and 2016 from three U.S. states. Our results provide broad support for our theory and show that higher levels of social buffering in local distribution portfolios halt positional advantage. Our results are robust across instrumented and non-instrumented model specifications.
Read the working paper (March 2022. version) on SSRN or SocArXiv.
Craft in distributor portfolios
Crashing the momentum
Change in the social logic of market relationships
Multiunit new entrant survival advantage, conditioned on the competitive landscape
Liability of newness suspended: The survival of multiunit new entrants in U.S. beer wholesaling
When Liability Becomes Potential
This paper focuses on an intermediary market segment and examines what happens to its incumbents and new entrants when there is a surge in the number of potential upstream partners. In the past thirty years in the U.S. beer industry, as the number of beer producers (i.e., brewers) proliferated, their intermediaries (i.e., wholesaler distributors) declined. This paper examines how under these conditions, two constraints, operating unit structure and historical competitive pressure effect the survival chances of new entrants and incumbent establishments. I use data on the population of U.S. beer distributors from the Longitudinal Business Database (1983–2013) and find that multiunit new entrants have better survival chances than multiunit incumbents. Furthermore, they are more likely to survive in areas where historical competitive pressure is high. I explain this finding via a social mechanism and show that in dynamic market contexts it is easier to create entirely new market ties than to change the old, socially embedded ones.
The spatial factor in craft brewer firm strategies
"The Beer We Brew": how the competitive landscape influences firms' product strategy
with Paul-Brian McInerney
This paper looks at heterogeneity in colocation patterns for distinct classes of organizations within the same industry. We find three distinct classes of craft breweries using latent class analysis: established, up-and-coming and innovator. Members of the innovator class tend to locate in dense markets near established organizations while up-and-coming firms use the strategies developed by the established class but in new geographic locales. We theorize that these patterns are a case of partitioning within the partition: innovators locate near established firms in order to serve consumers with sophisticated or adventurous palates who are not being serviced by the established craft brewers.