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Professor Shai B. Bernstein, PhD

Current Position

since 7/23

Research Fellow Department of Laws, Regulations and Factor Markets

Halle Institute for Economic Research (IWH) – Member of the Leibniz Association

since 2020

Associate Professor

Harvard Business School

Research Interests
  • entrepreneurial finance
  • innovation

Shai B. Bernstein joined the institute as a Research Fellow in May 2022. His research focuses on financial issues related to start-ups and high growth firms, and the interaction of these issues with innovation and entrepreneurial activity.

Shai B. Bernstein is the Marvin Bower Associate Professor in the Entrepreneurial Management Unit at Harvard Business School and a Faculty Research Fellow at the National Bureau of Economic Research (NBER).

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Professor Shai B. Bernstein, PhD
- Department Laws, Regulations and Factor Markets
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Publications

Citations
4417

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Flight to Safety: How Economic Downturns Affect Talent Flows to Startups

Shai B. Bernstein Richard R. Townsend Ting Xu

in: Review of Financial Studies, No. 3, 2024

Abstract

<p>Using proprietary data from AngelList Talent, we study how startup job seekers’ search and application behavior changed during the COVID-19 downturn. We find that workers shifted their searches and applications away from less-established startups and toward more-established ones, even within the same individual over time. At the firm level, this shift was not offset by an influx of new job seekers. Less-established startups experienced a relative decline in the quantity and quality of applications, ultimately affecting their hiring. Our findings uncover a flight-to-safety channel in the labor market that may amplify the procyclical nature of entrepreneurial activities.</p>

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The Effects of Public and Private Equity Markets on Firm Behavior

Shai B. Bernstein

in: Annual Review of Financial Economics, November 2022

Abstract

<p>In this article, I review the theoretical and empirical literature on the effects of public and private equity markets on firm behavior, emphasizing the consequences that emerge from disclosure requirements, ownership concentration, and degree of firm standardization. While publicly listed firms benefit from a lower cost of capital, enabling increased focus on commercialization and profitability, they are less suited to pursue long-term risky investments. Privately held firms are better equipped to pursue innovative projects but face a higher cost of capital, which limits their growth. Complementarities between public and private equity markets can mitigate their respective limitations. Innovation in private equity markets supplements commercialization efforts of public firms, and demand for innovation by public firms accelerates entrepreneurial activity in private equity markets. I conclude by discussing directions for future research.</p>

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Who Creates New Firms When Local Opportunities Arise?

Shai B. Bernstein Emanuele Colonnelli Davide Malacrino Timothy McQuade

in: Journal of Financial Economics, No. 1, 2022

Abstract

We examine the characteristics of the individuals who become entrepreneurs when local opportunities arise. We identify local demand shocks by linking fluctuations in global commodity prices to municipality-level agricultural endowments in Brazil. We find that the firm creation response is mostly driven by young and skilled individuals. The characteristics of these responsive entrepreneurs are significantly different from those of average entrepreneurs in the economy. By structurally estimating a novel two-sector model of a local economy, we highlight how the demographic composition of the local population can significantly affect the entrepreneurial responsiveness of the economy.

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