Jiayi Bao

• Tiantian Yang, Jiayi Bao, Howard E. Aldrich (2020), The Paradox of Resource Provision in Entrepreneurial Teams: Between Self-interest and the Collective Enterprise, Organization Science, 31 (6), pp. 1336-1358. Abstract

  Viewing entrepreneurship as a form of collective action, this paper investigates the tension between an entrepreneurial team’s reliance on collective efforts for achieving success and individual members’ tendencies to withhold their personal resources. We argue that the precarious nature of the early founding stage and the difficulty of redeploying some resources for other uses amplify the risk of early-stage resource contributions and may lead to team members withholding resources or even free riding. Two conditions may help overcome such collective action problems: adopting a formal contract to specify rewards and sanctions and encouraging reciprocal exchange among team members through the lead entrepreneur’s voluntary contributions. Analyzing a nationally representative multiwave panel study of entrepreneurial teams in the United States, we show that early-stage team members are reluctant to provide resources tailored to the business, even though such resources are critical to venture survival. We find that presigned formal contracts and founding entrepreneurs’ initial contributions make members’ contributions of such resources much more likely. Lead entrepreneurs’ voluntary contributions to their businesses, signified by their provision of resources that impose high risks on themselves but increase the viability of the business, help mitigate collective action problems within entrepreneurial teams.

• Tiantian Yang, Ming D. Leung, Jiayi Bao (Under Review), Approaching or Avoiding: Gender Asymmetry in Reactions to Prior Job Search Experience. Abstract

  This paper presents a novel investigation into how supply-side job seeking interacts with demand-side hiring decisions to reproduce occupational gender segregation. The authors theorize that because female job seekers are less confident of their ability in male-typed jobs than their male counterparts, they will be more responsive to cues from employers. Specifically, job application success will encourage female job seekers to approach similar work in the future; employers’ rejections, on the other hand, will be particularly discouraging, leading women to avoid similar work in the future. Analyses of a longitudinal dataset of three million applications for IT and programming jobs from an online freelancing platform support the theory. Past job-seeking experience, either positive or negative, exerted a stronger effect on how women, compared to men, approached or avoided applying to IT and programming. Because failure is the more prevalent outcome, female freelancers stop applying to male-typed jobs quicker than males. In contrast, analyses in the female-typed writing and translation field did not reveal similar gender patterns. Gender asymmetries in response to employers’ hiring decisions reproduce occupational gender segregation by reducing women’s representation in male-typed but not female-typed fields. Implications for research on gender segregation, careers and hiring are discussed.

  Description
  Under Review at ILR Review
• Jiayi Bao (Working), (How) Do Risky Perks Benefit Firms? The Case of Unlimited Vacation.
• Tiantian Yang, Maria Triana, Jiayi Bao (Under Revision), Against all odds: Why Black Entrepreneurs Are More Motivated and Persistent and Spite of Lower Business Success. Abstract

  Grounded in AMO (ability, motivation, opportunity) theory, this study takes a first step toward bringing race back into the entrepreneurship literature to predict how the race of the founding entrepreneur (i.e., Black or White) influences motivation to start a business and subsequent persistence and performance. We describe how, due to historic and present-day societal discrimination, Blacks tend to have fewer opportunities in the highest-ranking positions of Corporate America, and they are underrepresented in the upper echelons relative to their proportion of the workforce. Such barriers to Blacks in wage employment motivate them to enter and persist in entrepreneurship despite their lower odds of success. Using a sample from the Panel Study of Entrepreneurial Dynamics II (PSED II), we find that Black potential entrepreneurs have fewer relevant skills to start a business (e.g., less managerial experience) compared to White potential entrepreneurs, yet they have stronger motivation to start a business to make new opportunities for themselves and their families. We also find that Black individuals are more likely to start businesses than White individuals, and that although Black entrepreneurs are less financially successful than White entrepreneurs, they are more persistent than White entrepreneurs. The positive association between Black entrepreneurs’ race and business persistence is partially mediated by higher levels of motivation to run one’s own business.

  Description
  R&R at Research Policy
• Jiayi Bao (Working), When Time-Off Sparks Time-At-Work.
• Tiantian Yang, Jiayi Bao, Howard E. Aldrich (Forthcoming), The Paradox of Resource Provision in Entrepreneurial Teams: Between Self-Interest and the Collective Enterprise. Abstract

  Using a nationally representative multi-wave panel study of nascent entrepreneur, we investigate the antecedents and consequences of the founding entrepreneur’s paradox: assembling an entrepreneurial team as a way of eliciting contributions from others may not provide enough resources to launch new venture. We argue that the precarious nature of the early founding stage and the intrinsic properties of valuable resources, such as difficulty in withdrawing or redeploying them for other uses, may amplify the risk of early-stage resource contributions and increase team members’ tendencies toward free- riding and hold-up. The expectation that early entrepreneur efforts will not pay off may discourage individuals from investing their own resources early on, generating tension between individuals’ natural dispositions to guard their personal interests and a team’s dependence on collective efforts, ultimately limiting members’ contributions. Analyzing a representative sample of entrepreneurial teams in the United States assembled in 2005, we show that early-stage team members are more willing to provide extractible/duplicable resources (i.e. information, advice) than non-extractible/non-duplicable resources (i.e. financial resource and time), even though such resources are less critical to venture survival than non-extractible/non-duplicable resources. Pre-signed formal contracts and founding entrepreneurs’ initial contributions make members’ contributions more likely. Our results suggest that entrepreneurs’ commitments to their business, signified by their contributions of valuable resources, help mitigate the tension between individuals’ tendencies to preserve their personal resources and a teams’ reliance on collective effort for success in cases where teams have not signed collective agreements regarding ownership.

  Description
  Accepted at Organization Science
• Jiayi Bao and Andy Wu (Working), Equality and Equity in Compensation. Abstract

  Equity compensation is widely used for incentivizing skilled employees, particularly in new technology businesses. Traditional theories explaining why firms offer equity suggest that workers with higher rank should receive compensation packages more heavily weighted in equity. However, we observe the puzzle that many firms adopt an equality-in-equity strategy: they offer different cash salaries across all jobs but the same equity compensation. We propose a behavioral theory of domain-contingent inequality aversion to explain this finding: we argue that workers view salary and equity as two domains and are more inequality averse in the equity domain. Inequality in equity has a negative asymmetric effect on effort whereas the effect of inequality in salary can be positive. Our experimental findings are consistent with the existence of domain-contingent inequality aversion; we also find that inequality aversion in equity is more severe than in salary because of the perceived scarcity of equity.

• Jiayi Bao and Benjamin Ho (2015), Heterogeneous Effects of Informational Nudges on Pro-social Behavior, The B.E. Journal of Economic Analysis & Policy, 15 (4), pp. 1619-1655. Abstract

  Numerous experimental studies of informational nudges both in the lab and the field have demonstrated not just that informational nudges are effective policy tools for influencing behavior, but also that nudges have heterogeneous impacts that differ depending on the characteristics of the person involved and the situation. We adapt Andreoni’s theory of warm-glow impure altruism to account for how altruism motives respond differently depending on the disposition of the person and the situation. The model explains both positive spillovers (moral cleansing) and negative spillovers (moral licensing) for behavioral interventions, showing that targeting of informational campaigns depends on the complementarity between people’s traits and the intervention’s content. More importantly, the design of economic incentives (like Pigouvian taxes) to shift economic behavior should depend on both the distribution of social preferences in the population and the use of behavioral interventions.

Past Courses

• BEPP2500 - Managerial Economics

  This course will introduce you to "managerial economics" which is the application of microeconomic theory to managerial decision-making. Microeconomic theory is a remarkably useful body of ideas for understanding and analyzing the behavior of individuals and firms in a variety of economic settings. The goal of the course is for you to understand this body of theory well enough so that you can effectively analyze managerial (and other) problems in an economic framework. While this is a "tools" course, we will cover many real-world applications, particularly business applications, so that you can witness the usefulness of these tools and acquire the skills to use them yourself. We will depart from the usual microeconomic theory course by giving more emphasis to prescription: What should a manager do in order to achieve some objective? That course deliverable is to compare with description: Why do firms and consumers act the way they do? The latter will still be quite prominent in this course because only by understanding how other firms and customers behave can a manager determine what is beswt for him or her to do. Strategic interaction is explored both in product markets and auctions. Finally, the challenges created by asymmetric information - both in the market and within the firm - are investigated.

• EDEN5010 - Entrepreneurship in Educ

  Entrepreneurship in Education provides an understanding of the nature of entrepreneurship related to public/private/for profit and non-profit educational and social organizations. The course focuses on issues of management, strategies and financing of early stage entrepreneurial ventures, and on entrepreneurship in established educational organizations. Students will learn the fundamentals of business plan design and development. This course is only available to students in the Education Entrepreneurship program. Prerequisite: Enrollment in Education Entrepreneurship program.

• REER Best Student Paper Award Finalist, 2019
• Mack Institute Research Fellowship, 2019
• Wharton People Analytics Research Paper Competition Finalist, 2019
• Wharton Risk Center Russell Ackoff Doctoral Student Fellowship Award, 2018
• Mack Institute Research Fellowship, 2018
• Wharton George James Travel Award, 2018
• Kauffman Knowledge Challenge Grant (Insight to Impact), 2018
• Mack Institute Research Fellowship, 2017
• Emilie Louise Wells Fellowship, 2017
• Wharton People Analytics Research Paper Competition Finalist, 2017
• Wharton George James Travel Award, 2017
• Emilie Louise Wells Fellowship, 2016
• Mack Institute Research Fellowship, 2016
• Wharton Risk Center Russell Ackoff Doctoral Student Fellowship Award, 2016
• I.S.E.O. Summer School Scholarship, 2014
• The Virginia Swinburne Brownell Prize in Political Economy, 2014
• The Agnes Reynolds Jackson Prize, 2014
• Plenary Speaker at National Collegiate Research Conference, 2014
• The DeGolier Prize for Academic Excellence, 2013
• Lui & Wan Foundation Scholarship, 2010

• These are the perks that matter most to employees, World Economic Forum - 11/12/2019
• Who are American Angels? Wharton and Angel Capital Association Study Changes Perceptions About the Investors Behind U.S. Startup Economy, Business Insider - 11/28/2017
• Unlimited Vacation Time: Could Your Company Make It Work?, Knowledge@Wharton - 03/07/2017

Knowledge @ Wharton

• Five Myths About Generative AI That Leaders Should Know, Knowledge @ Wharton - 04/30/2024
• How Bank Depositors Are Becoming More Alert, Knowledge @ Wharton - 04/30/2024
• Is Influencer Marketing Worth It?, Knowledge @ Wharton - 04/29/2024
• Is Influencer Marketing Worth It?, Knowledge @ Wharton - 04/26/2024
• What Is the Role of Customers in the Gig Economy?, Knowledge @ Wharton - 04/25/2024
• Co-hosts of the ‘Gen Z on Gen Z’ Podcast, Knowledge @ Wharton - 04/25/2024
• 2024 NFL Draft, Knowledge @ Wharton - 04/24/2024
• Former Levi’s CEO on Revitalizing a Brand — and the Right Way to Wash Jeans, Knowledge @ Wharton - 04/23/2024
• Why Is Financial Literacy Important? | Olivia S. Mitchell, Knowledge @ Wharton - 04/23/2024
• What Does the Labor Side of Manufacturing Need Over the Next Decade?, Knowledge @ Wharton - 04/23/2024