Adoptive expectations: Rising sons in Japanese family firms
AbstractWe find inherited family firms more important in postwar Japan than generally realized, and also performing well on average. Non-consanguineous heir-run firms outperform blood heirs' firms, and roughly match founder-run listed firms, while blood heirs surpass professional managers at running family firms. Further, succession events suggest that adopted heirs “cause” elevated performance. We suggest that heir-run firms do well because non-consanguineous heirs displace the least talented blood heirs, the non-consanguineous heir “job” motivates professional managers, and the threat of displacement encourages blood heirs' effort and human capital accumulation, mitigating the “Carnegie conjecture” that inherited wealth deadens talent.
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Bibliographic InfoArticle provided by Elsevier in its journal Journal of Financial Economics.
Volume (Year): 108 (2013)
Issue (Month): 3 ()
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Web page: http://www.elsevier.com/locate/inca/505576
Adoptions; Corporate governance; Family business; Inherited ability; Japan; Succession;
Other versions of this item:
- Vikas Mehrotra & Randall Morck & Jungwook Shim & Yupana Wiwattanakantang, 2011. "Adoptive Expectations: Rising Sons in Japanese Family Firms," NBER Working Papers 16874, National Bureau of Economic Research, Inc.
- G3 - Financial Economics - - Corporate Finance and Governance
- J12 - Labor and Demographic Economics - - Demographic Economics - - - Marriage; Marital Dissolution; Family Structure
- N25 - Economic History - - Financial Markets and Institutions - - - Asia including Middle East
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