The benefits of family ownership, control and management on financial performance of firms
AbstractThe benefits of family ownership and control of firms are at the center of the family firm debate. Previous studies have used either family ownership or management as proxies for control. Both indicators are off the mark, as they do not measure decision control as intended by the theory of the firm. This is the first study investigating the direct influence of family ownership, control and management on financial firm performance, while controlling for goal heterogeneity of different stakeholders. Our results clearly show that family control is beneficial for all stakeholders, while neither family ownership nor management influences financial performance. Monitoring behavior of families is the central component and essence of family firms and can be used as a point of departure for the development of a unified theory of family firms. --
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
Bibliographic InfoPaper provided by University of Augsburg, Chair of Management and Organization in its series UO Working Papers with number 05-10.
Date of creation: 2010
Date of revision:
Corporate Governance; Family Business; Ownership and Control;
Find related papers by JEL classification:
- G32 - Financial Economics - - Corporate Finance and Governance - - - Financing Policy; Financial Risk and Risk Management; Capital and Ownership Structure; Value of Firms; Goodwill
- L22 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Firm Organization and Market Structure
- L26 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Entrepreneurship
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Mike W. Peng & Yi Jiang, 2010. "Institutions Behind Family Ownership and Control in Large Firms," Journal of Management Studies, Wiley Blackwell, vol. 47(2), pages 253-273, 03.
- William Gould, 1998. "Interquartile and simultaneous-quantile regression," Stata Technical Bulletin, StataCorp LP, vol. 7(38).
- Erik Lehmann & Juergen Weigand, 2000. "Does the Governed Corporation Perform Better? Governance Structures and Corporate Performance in Germany," CoFE Discussion Paper 00-05, Center of Finance and Econometrics, University of Konstanz.
- 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.
- Shleifer, Andrei & Vishny, Robert W., 1986.
"Large Shareholders and Corporate Control,"
3606237, Harvard University Department of Economics.
- Erik Lehmann & Susanne Warning & Jürgen Weigand, 2004. "Governance Structures, Multidimensional Efficiency and Firm Profitability," Journal of Management and Governance, Springer, vol. 8(3), pages 279-304, 06.
- James S. Ang & Rebel A. Cole & James Wuh Lin, 2000. "Agency Costs and Ownership Structure," Journal of Finance, American Finance Association, vol. 55(1), pages 81-106, 02.
- Andrei Shleifer & Robert W. Vishny, 1995.
"A Survey of Corporate Governance,"
Harvard Institute of Economic Research Working Papers
1741, Harvard - Institute of Economic Research.
- Roger Koenker & Kevin F. Hallock, 2001.
Journal of Economic Perspectives,
American Economic Association, vol. 15(4), pages 143-156, Fall.
- Rafael La Porta & Florencio Lopez-de-Silanes & Andrei Shleifer, 1998.
"Corporate Ownership Around the World,"
Harvard Institute of Economic Research Working Papers
1840, Harvard - Institute of Economic Research.
- Marc Lévy, 2009.
"Control in pyramidal structures,"
ULB Institutional Repository
2013/14291, ULB -- Universite Libre de Bruxelles.
- Jensen, Michael C. & Meckling, William H., 1976. "Theory of the firm: Managerial behavior, agency costs and ownership structure," Journal of Financial Economics, Elsevier, vol. 3(4), pages 305-360, October.
- Fama, Eugene F & Jensen, Michael C, 1983. "Separation of Ownership and Control," Journal of Law and Economics, University of Chicago Press, vol. 26(2), pages 301-25, June.
- Demsetz, Harold, 1983. "The Structure of Ownership and the Theory of the Firm," Journal of Law and Economics, University of Chicago Press, vol. 26(2), pages 375-90, June.
- Mauricio Jara-Bertin & Félix J. López-Iturriaga & Ãscar López-de-Foronda, 2008. "The Contest to the Control in European Family Firms: How Other Shareholders Affect Firm Value," Corporate Governance: An International Review, Wiley Blackwell, vol. 16(3), pages 146-159, 05.
- Morck, Randall & Shleifer, Andrei & Vishny, Robert W., 1988. "Management ownership and market valuation : An empirical analysis," Journal of Financial Economics, Elsevier, vol. 20(1-2), pages 293-315, January.
- Demsetz, Harold & Lehn, Kenneth, 1985. "The Structure of Corporate Ownership: Causes and Consequences," Journal of Political Economy, University of Chicago Press, vol. 93(6), pages 1155-77, December.
- Renato Giovannini, 2010. "Corporate governance, family ownership and performance," Journal of Management and Governance, Springer, vol. 14(2), pages 145-166, May.
- Randoy, Trond & Goel, Sanjay, 2003. "Ownership structure, founder leadership, and performance in Norwegian SMEs: implications for financing entrepreneurial opportunities," Journal of Business Venturing, Elsevier, vol. 18(5), pages 619-637, September.
- Roberto Barontini & Lorenzo Caprio, 2006. "The Effect of Family Control on Firm Value and Performance: Evidence from Continental Europe," European Financial Management, European Financial Management Association, vol. 12(5), pages 689-723.
- Catherine Daily & Janet Near, 2000. "Ceo Satisfaction and Firm Performance in Family Firms: Divergence between Theory and Practice," Social Indicators Research, Springer, vol. 51(2), pages 125-170, August.
- Hülsbeck, Marcel & Lehmann, Erik E. & Weiß, Dominik & Wirsching, Katharine, 2011. "Innovationsverhalten in Familienunternehmen," UO Working Papers 02-11, University of Augsburg, Chair of Management and Organization.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (ZBW - German National Library of Economics).
If references are entirely missing, you can add them using this form.