Working Papers

Research on organizational misconduct has largely conceptualized disclosure as a stigmatizing event that penalizes organizational elites. We extend this work by examining how disclosure affects lower-ranked workers. Drawing on stigma and attribution theories, we argue that elites are more likely to be perceived as responsible for wrongdoing and therefore face stronger career penalties than lower-ranked workers.

Using unique matched employer–employee data from Brazil linked to state-sponsored sanctions under the anti-corruption law, we find strong support for this prediction. Following disclosure, upper white-collar workers experience significant wage declines and are more likely to exit formal employment. In contrast, blue-collar workers experience no comparable wage losses and are less likely to exit the formal sector. Beyond these predicted differences, we find that blue-collar workers who remain in the formal sector experience persistent wage gains following disclosure.

To reconcile these findings, we abductively develop a reformative account, proposing that disclosure exposes firms to greater scrutiny and incentivizes reforms that may dislodge inequitable practices and arrangements that previously disadvantaged lower-ranked workers. Overall, these findings suggest that while misconduct disclosure generates career penalties through stigma by association, it may also improve work outcomes for some workers by disrupting inequitable organizational arrangements.

Startup employment can be consequential for workers’ careers. Prior research documents that employment in young firms can be precarious, exposing workers to career instabilities with potentially lasting consequences. Why, then, do workers join startups? Existing explanations emphasize the prospect of outsized financial rewards and the appeal of startup narratives. I argue that startup employment may also be attractive because it provides opportunities for career attainment by granting workers earlier access to positions with greater authority and more analytically intensive work than are typically available in established organizations.

Using matched employer–employee data linking Revelio Labs employment histories to PitchBook startups, I compare early joiners at startups to comparable workers entering established firms. I find that startup employment is associated with entry into positions carrying greater authority and responsibility, as well as work characterized by more non-routine analytical content. Both dimensions are associated with stronger attachment to entrepreneurial careers and a greater likelihood of subsequent founder transitions.

These opportunities, however, are not distributed equally. Relative to men, women realize smaller gains in hierarchical placement and are routed into roles characterized by lower levels of abstract task content. These differences also explain part of the subsequent gender gap in entrepreneurial careers.