Please use this identifier to cite or link to this item:
http://bura.brunel.ac.uk/handle/2438/16940
Title: | Non-compete clauses, employee effort and spin-off entrepreneurship: A laboratory experiment |
Authors: | Buenstorf, G Engel, C Fischer, S Gueth, W |
Keywords: | Non-compete clause;Effort;Spin-off entrepreneurship;Reciprocity;Fairness |
Issue Date: | 2018 |
Publisher: | Elsevier |
Citation: | Research Policy, 2016, 45 (10), pp. 2113 - 2124 |
Abstract: | We experimentally test the effect of enforceable non-compete clauses on working effort and spin-off entrepreneurship. An employee invests effort in the probability of a profitable innovation. After a successful innovation the employee may want to start her own spin-off firm and compete with her prior employer. In the baseline setup without non-compete clause, spin-offs result from failed negotiation about employee compensation even though they reduce the joint payoffs of both parties. In two treatments with non-compete clause the employer can prevent successful innovators from leaving the firm. We find no significantly negative effect of non-compete clauses on employee effort, even if compensation is low. |
URI: | http://bura.brunel.ac.uk/handle/2438/16940 |
DOI: | http://dx.doi.org/10.1016/j.respol.2016.08.005 |
ISSN: | 0048-7333 |
Appears in Collections: | Dept of Economics and Finance Research Papers |
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