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Implications of Intra-Family and External Ownership Transfer Of Family Firms: Short Term and Long Term Performance

Author

Listed:
  • Wennberg, Karl

    (The Ratio Institute and Stockholm School of Economics)

  • Wiklund, Johan

    (Whitman School of Management)

  • Hellerstedt, Karin

    (Jönköping International Business School)

  • Nordqvist, Mattias

    (Jönköping International Business School)

Abstract

We contrast the performance consequences of intra-family vs. external ownership transfers. Investigating a sample of all private family firms in Sweden that went through ownership transfers during ten years, we find family firms transferred to external owners outperforming those transferred within the family, but that survival is higher among intra-family transfers. We attribute these performance differences to the long-term orientation of family firms passed on to the next generation and to the entrepreneurial willingness of acquirers to bear uncertainty. Based on distinct ownership transition routes and theoretical mechanisms explaining performance differences, we outline implications for family business and entrepreneurship research.

Suggested Citation

  • Wennberg, Karl & Wiklund, Johan & Hellerstedt, Karin & Nordqvist, Mattias, 2011. "Implications of Intra-Family and External Ownership Transfer Of Family Firms: Short Term and Long Term Performance," Ratio Working Papers 172, The Ratio Institute.
    • Handle: RePEc:hhs:ratioi:0172
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    More about this item

    Keywords

    long-term orientation; succession; ownership transfer; family firms; performance;
    All these keywords.

    JEL classification:

    • L26 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Entrepreneurship
    • M13 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Administration - - - New Firms; Startups

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