Human Resource Redeployability and Entrepreneurial Hiring Strategy: Evidence from Finnish Microdata (R&R, SMJ)

The timing of talent acquisition is a central decision for new ventures. On one hand, starting small and hiring after demand is proven minimizes losses in case of low demand. On the other hand, hiring before demand is proven allows new ventures to start developing unique capabilities. We resolve this tension by proposing that the extent to which ventures hire before demand depends on human resource redeployability. We further argue that resource redeployability affects the type of employees hired. We test our theory with the population of Finnish standalone and portfolio ventures showing that portfolio entrepreneurs hire more employees early on because they have the option to redeploy them and that they hire employees with more transferable skills in order to benefit from the redeployment. Read more...

A general interindustry relatedness index

This is my R code for the general interindustry relatedness index of Bryce and Winter (2009). The code can be just as well used to generate the time-variant relatedness index of Cetorelli, Jacobides and Stern (2021). In my research, to compute this measure I make use of Finnish Patent and Registration Office's data on Finnish corporate groups. The dataset shows all the corporate group links between limited liability companies in Finland reported in official annual accounts. Based on these links, I calculate the frequency of joint occurrence of all two-digit NACE Rev.2 pairs in a corporate group and apply the frequency scores to portfolio ventures in my venture dataset. To GitHub...