Entry resources and the survival of worker‐owned firms

Abstract This article examines whether the distinct ownership and governance structure of worker‐owned firms (WOFs) provides a survival advantage over conventional firms (CFs). Using data from six cohorts of French firms, this analysis employs propensity score matching and a discrete‐time hazard model to isolate the effects of entry resources—such as initial capital, firm size and entrepreneur characteristics—on survival likelihood. Findings reveal that, at first sight, WOFs show higher survival rates than CFs, but this advantage largely dissipates when accounting for entry resources, confirming the prediction of the resource‐based view (RBV) and indicating that prior studies may suffer from selection bias. The findings also suggest that WOF governance may influence survival indirectly by facilitating stronger resource accumulation at entry and depict WOFs as robust organizational forms competitive across diverse sectors. Importantly, WOFs display a significant survival advantage over matched CFs in sectors with low capital and knowledge intensity. Measures of life quality at Year 5 reveal similar economic health between WOFs and CFs. This article also details the role of entry resources and governance structures in firm longevity, thereby extending the application of the RBV to the context of cooperatives and offering a nuanced understanding of the mechanisms underlying WOF survival.