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Altruism and Agency in the Family Firm: Exploring the Role of Family, Kinship, and Ethnicity

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  • Neri Karra
  • Paul Tracey
  • Nelson Phillips

Abstract

This article examines the relationship between altruism and agency costs in family business through an in–depth case study of a family firm. We found that altruism reduced agency costs in the early stages of the business, but that agency problems increased as the venture became larger and more established. Moreover, we suggest that altruistic behavior need not be confined to family and close kin, but may extend through networks of distant kin and ethnic ties. We thus present a more complex view of the agency relationship in family business than is often portrayed in the existing literature.

Suggested Citation

  • Neri Karra & Paul Tracey & Nelson Phillips, 2006. "Altruism and Agency in the Family Firm: Exploring the Role of Family, Kinship, and Ethnicity," Entrepreneurship Theory and Practice, , vol. 30(6), pages 861-877, November.
    • Handle: RePEc:sae:entthe:v:30:y:2006:i:6:p:861-877
    DOI: 10.1111/j.1540-6520.2006.00157.x
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    References listed on IDEAS

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