Social Science and Technology Seminar Winter 2017
Seminars take place on Wednesdays 4-5:30pm in the 3rd Floor Conference Room, John A. and Cynthia Fry Gunn Building at 366 Galvez Street unless otherwise noted.
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Social Science and Technology Seminar
January 17, 2017
RACIAL AND GENDER DISCRIMINATION IN TRANSPORTATION NETWORK COMPANIES
Stephen Zoepf (Stanford)
Passengers have faced a history of discrimination in transportation systems. Peer transportation companies such as Uber and Lyft present the opportunity to rectify long-standing discrimination or worsen it. We sent passengers in Seattle, WA and Boston, MA to hail nearly 1,500 rides on controlled routes and recorded key performance metrics. Results indicated a pattern of discrimination, which we observed in Seattle through longer waiting times for African American passengers — as much as a 35 percent increase. In Boston, we observed discrimination by Uber drivers via more frequent cancellations against passengers when they used African American sounding names. Across all trips, the cancellation rate for African American sounding names was more than twice as frequent compared to white sounding names. Male passengers requesting a ride in low-density areas were more than three times as likely to have their trip canceled when they used a African American-sounding name than when they used a white-sounding name. We also find evidence that drivers took female passengers for longer, more expensive, rides in Boston. We observe that removing names from trip booking may alleviate the immediate problem but could introduce other pathways for unequal treatment of passengers.
January 26, 2017
***NOTE CHANGE OF LOCATION: Packard 101***
THE DYNAMICS OF YOUNG VENTURE DEVELOPMENT: THE EVOLUTION OF FUNCTIONAL ROLES & VC FUNDRAISING
Ranjay Gulati (HBS)
This paper examines the evolution of young ventures by considering the relationship between their delineation of functional roles and their ability to attract resources from venture capital investors. Prior research has suggested that ventures formalize roles and introduce functional specialists as they evolve as part of a process sometimes referred to as professionalization. We clarify and distinguish the types of functional roles that ventures introduce and theorize how the formal dedication of personnel to each of these domains helps attract funding. We propose that the degree of importance of each role type varies at different points in the venture’s development as a result of changing loci of investor concerns and norms about what constitute critical activities across funding stages. We test our predictions using a novel longitudinal dataset that combines information on how 2,627 San Francisco-based technology ventures internally organized across their entire early lives with information on their success in progressing between the first three funding stages. This study contributes to research on organizational evolution, entrepreneurship, and organizational design.
January 31, 2017
*** NOTE CHANGE OF LOCATION: Koret-Taube Conference Center Room 120 (small room on the 1st floor) ***
THE SOCIAL EMBEDDEDNESS OF TRADERS IN ATOMIZED FINANCIAL MARKETS
Aks Zaheer (University of Minnesota)
Research shows that financial markets have a social structure that shapes their functioning and generates deviations in agents’ behaviors relative to the predictions of economic models. However, most research studying this issue situates it in contexts in which constraints from formal or informal rules temper the free flow of information. But when the context is an exceptionally transparent free-wheeling, fully atomized “Hobbesian” market of the individualized pursuit of financial gains from on-line currency trading, in which information asymmetry is negligible, will social structure still play a role or will economic considerations dominate in the making of financial decisions? Our results with a large longitudinal dataset of 20,423 traders suggest that social structure, and other social mechanisms, still dominate a key financial decision, despite the ready availability of economic information. Further, market uncertainty enhances reliance on social structure
February 28, 2017
THE DOMINANT LOGIC OF MATCHING: FINDING ACQUISITION TARGETS
Henrich Greve (INSEAD)
Acquisitions are preceded by a search for targets and assessment of whether a potential target is a good fit. While prior research has emphasized resource fit and search costs, we argue that the dominant logic of the acquirer is a source of direction and constraint in the search. Based on this theory, cognitive schema and myopia by the dominant coalition can shape top management strategic analysis and conception of the firm, and are important influences in resource allocations such as acquisitions. They are likely to narrow down their search to targets that resonate with them on the mental construction of the firm environment. As a result, firms match not only on resources, but also on characteristics that are likely to be a source of cognitive schema that are influential in the dominant logic, such as nature of governance, ownership structure, and board composition. We derive new hypotheses on target selection in acquisitions from this theory, and our findings support the hypotheses by showing strong influences from this mechanism on target selection in acquisitions in China.
March 14, 2017
How Many Jobs Does an Entrepreneur Create? Evidence from the Universe of U.S. Startups
Robert W. Fairlie (presenter), University of California, Santa Cruz, Stanford University (Visiting Scholar) and NBER
Javier Miranda, U.S. Census Bureau
Nikolas Zolas, U.S. Census Bureau
Entrepreneurship is promoted around the world partly to create jobs, but surprisingly, we do not even know the answer to the simple question of how many jobs does an entrepreneur create. In this paper, we provide the first measure of the number of jobs created by the average entrepreneur in the United States and new evidence on the rich job creation dynamics of entrepreneurs. We track job creation over time by every business startup in the U.S. economy by using administrative data on the universe of non-employer firms linked to the universe of employer firms in the Longitudinal Business Database (LBD) through the Integrated Longitudinal Business Database (iLBD). We find that the average entrepreneur creates 0.59 jobs at startup, and between 0.50 to 0.66 net jobs in each of the next seven years. The annual cohorts of 5 to 6 million startups in the United States create a total average of 3.2 million jobs in the startup year. These jobs do not disappear: net job creation rises to 3.6 million jobs one year after startup, and declines only slightly to 2.7 million jobs seven years after startup. We also find substantial heterogeneity in the dynamics of job creation among startups. Although a very large percentage of startups exit in the first few years, many survivors grow and many startups with no initial employees hire employees, thus mostly offsetting each other. In terms of total payroll, the average entrepreneur generates $22,200 in payroll at startup and $20,900 in payroll seven years after startup. These estimates have important welfare and policy implications for how we view entrepreneurship and job creation.