Entrepreneurship Working Group.

• Position: Program and Working Group Meetings

The NBER's Working Group on Entrepreneurship met in Cambridge on March 14. Director Josh Lerner of Harvard University organized this program:

Asim I. Khwaja, Harvard University; Atif Mian, University of Chicago; and Abid Qamar, State Bank of Pakistan, "The Value of Business Networks"

Discussant: Erica Field, Harvard University

Amar Bhide, Columbia University, "Founders and Staff: Global At Home"

Discussant: William Kerr, Harvard University

Aaron Chatterji, Duke University; Kenneth Y. Chay, University of California, Berkeley; and Robert W. Fairlie, University of California, Santa Clara, "The Impact of City Contracting Set-Asides on Minority Self-Employment"

Discussant: Barton Hamilton, Washington University in St. Louis

Ulrike Malmendier, University of California, Berkeley and NBER, and Josh Lerner, "With a Little Help from My (Random) Friends: Success and Failure in Post-Business School Entrepreneurship"

Discussant: David Robinson, Duke University

Brent Goldfarb, Gerard Hoberg, David Kirsch, and Alexander Triantis, University of Maryland, "Are Angels Preferred Venture Investors?"

Discussant: Enrico Perotti, University of Amsterdam

Thomas Chemmanur and Karthik Krishnan, Boston College, and Debarshi Nandy, York University, "How Does Venture Capital Financing Improve Efficiency in Private Firms? A Look beneath the Surface"

Discussant: Rebecca Zarutskie, Duke University

Khwaja and his co-authors construct the topology of business networks across the entire population of private firms in Pakistan, and estimate the value of network membership in enhancing bank credit and improving financial viability. They link two firms together if they have a common director and find that the resulting topology includes a "super-network" comprising 5 percent of firms but over one-half of all bank credit. They estimate the value of joining the super-network by instrumenting network membership with "incidental" entry and exit of firms over time. Network membership increases total external financing by 16.5 percent, reduces propensity to enter financial distress by 9.7 percent, and better insures firms against industry and location shocks. These benefits are stronger when firms connect through more powerful network nodes, and newly networked firms are more likely to start new banking relationships with banks already lending to its super-network neighbors.

The participation of immigrant scientists and engineers in the U.S. high-tech industry is in some ways a...