Introduction
Many individuals found their own ventures, or enter self-employment, at some stage of their career. However, most entrepreneurial ventures fail, after which their founders typically re-enter the paid labor market. What are the consequences of entrepreneurial experience for subsequent outcomes in paid employment? Fully understanding how entrepreneurial activity fits into career trajectories (Burton, Sørenen and Dobrev 2016) requires a deeper understanding of how employers view such experiences. Existing resume-based audit studies have found negative returns to entrepreneurial experience, meaning that individuals whose resumes show prior entrepreneurial experience are less likely to receive a call-back from the employer than individuals whose resumes only show conventional work experience.
Existing studies argue that negative stereotypes about former founders, such as being averse to authority, raise concerns about the job candidate’s commitment and fit with the organization. However, there also exist positive beliefs about people with entrepreneurial experience that are related to work – innovative, ambitious, and skillful in many tasks. More generally, what exactly drives such a founder penalty is unclear. The proposed study aims to fill this gap in the literature by studying the processes by which employers perceive and evaluate entrepreneurial experience. Specifically, the study tests whether the penalty against former founders transpires when employers are screening resumes or making careful deliberation among the screened resumes or both.
Study 1, an online experiment, provides an initial test of whether employers penalize job candidates with founding experience during the screening stage or the evaluation stage or both stages. Study 1 therefore is a between-subject design that consists of two types of experimental manipulations: (1) whether the resume of is of job candidates with entrepreneurial experience and (2) whether the participants make decisions under the screening stage or the evaluation stage. In testing the latter (screening vs. evaluation), I manipulate the amount of cognitive control involved in the decision-making process to observe how decisions made under minimum cognitive control – akin to screening processes – differ from more controlled or deliberate processes. Manipulations are made incrementally to the “baseline” screening-stage experiment in that we increase the extent to which processing is controlled with every manipulation.
In the baseline experiment, participants are made to think fast, and screen out resumes that are less eligible to reduce a pile or resumes into a manageable number. Participants of the baseline experiment should exert the lowest level of cognitive control. The first manipulation removes time pressure, which involves removing visual cues (timer showing elapsed time), as well as instructed time. The second and stronger manipulation is to ask participants to write a paragraph of strengths and weaknesses before making decisions. This manipulation addresses the concern that having luxury of time does not guarantee careful deliberation. By forcing participants to think about and consider multiple attributes of the job candidate, this manipulation is expected to yield the highest cognitive control.
Methods
Planned Sample
The planned sample of the present replication study is 800 individuals who have hiring experience (100 individuals per condition). If the budget allows for further selection of the sample, it would be helpful to recruit up to 500 individuals per condition.
Analysis Plan
The dependent variable is the decision (yes/no) whether the participant thinks the given candidate should be selected for an interview. The primary explanatory variables are twofold: (1) 3 experimental conditions (baseline screening, without time pressure, and deliberation) and (2) whether the resume is of ex-founder or ex-employee. The key analyses of interest therefore are t-test comparing the decisions of former founders by experimental condition, as well as regressions that predict the decision with the explanatory variables.