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Owner Identity and Firm Performance: Evidence from European Companies

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  • Marco Cucculelli

    ()
    (Università Politecnica delle Marche, Ancona)

Abstract

Empirical evidence of the distribution of firms by owner identity for a set of European countries reveals substantial differences. Using the sensitivity of a firm’s sales to demand shocks as a measure of risk-taking behavior, the paper explores if owner identity affects the willingness of the firms to seize market opportunities. Consistent with a hypothesis of risk-avoidance behavior, family-owned companies appear to underreact to changes in market demand. Conversely, industrial and nonconcentrated family-owned firms appear more prone to deal with venturing risk, especially in the case of fast-growing companies or demand changes in nondomestic markets.

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File URL: http://www.rivistapoliticaeconomica.it/2008/mar-apr/Cucculelli.pdf
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Bibliographic Info

Article provided by SIPI Spa in its journal Rivista di Politica Economica.

Volume (Year): 98 (2008)
Issue (Month): 2 (March-April)
Pages: 149-178

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Handle: RePEc:rpo:ripoec:v:98:y:2008:i:2:p:149-178

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Keywords: owner identity; SMEs; risk aroidance; family firms.;

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References

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  1. David Sraer & David Thesmar, 2004. "Performance and Behavior of Family Firms : Evidence from the French Stock Market," Working Papers 2004-24, Centre de Recherche en Economie et Statistique.
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  9. Giorgio Barba Navaretti & Riccardo Faini & Alessandra Tucci, 2008. "Does Family Control Affect Trade Performance? Evidence for Italian Firms," CEP Discussion Papers dp0896, Centre for Economic Performance, LSE.
  10. Nick Bloom & John Van Reenen, 2006. "Measuring and explaining management practices across firms and countries," LSE Research Online Documents on Economics 733, London School of Economics and Political Science, LSE Library.
  11. Fogel, Kathy & Morck, Randall & Yeung, Bernard, 2008. "Big business stability and economic growth: Is what's good for General Motors good for America?," Journal of Financial Economics, Elsevier, vol. 89(1), pages 83-108, July.
  12. Cucculelli, Marco & Micucci, Giacinto, 2008. "Family succession and firm performance: Evidence from Italian family firms," Journal of Corporate Finance, Elsevier, vol. 14(1), pages 17-31, February.
  13. Maury, Benjamin, 2006. "Family ownership and firm performance: Empirical evidence from Western European corporations," Journal of Corporate Finance, Elsevier, vol. 12(2), pages 321-341, January.
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  15. Miller, Danny & Le Breton-Miller, Isabelle & Lester, Richard H. & Cannella Jr., Albert A., 2007. "Are family firms really superior performers?," Journal of Corporate Finance, Elsevier, vol. 13(5), pages 829-858, December.
  16. Villalonga, Belen & Amit, Raphael, 2006. "How do family ownership, control and management affect firm value?," Journal of Financial Economics, Elsevier, vol. 80(2), pages 385-417, May.
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Citations

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Cited by:
  1. Cucculelli, Marco & Marchionne, Francesco, 2012. "Market opportunities and owner identity: Are family firms different?," Journal of Corporate Finance, Elsevier, vol. 18(3), pages 476-495.
  2. Matteo Bugamelli & Luigi Cannari & Francesca Lotti & Silvia Magri, 2012. "The innovation gap of Italy’s production system: roots and possible solutions," Questioni di Economia e Finanza (Occasional Papers) 121, Bank of Italy, Economic Research and International Relations Area.
  3. Bianco, Madga & Golinelli, Roberto & Parigi, Giuseppe, 2009. "Family firms and investments," MPRA Paper 19247, University Library of Munich, Germany.

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