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Intergenerational Succession in Family Businesses and the Risk of Corporate Default

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  • Deng, JiaYing
  • Ren, Qin

Abstract

This study empirically investigates the impact of intergenerational succession in family businesses on corporate default risk, specifically targeting family-listed firms in China's Shanghai and Shenzhen A-share markets. The results reveal that intergenerational succession significantly lowers corporate default risk. Mechanism tests further suggest that this reduction in default risk is indirectly achieved by curbing the scale of corporate investment activities. Heterogeneity analysis indicates that the decrease in corporate default risk associated with intergenerational succession is most pronounced in firms facing high liquidity constraints.

Suggested Citation

  • Deng, JiaYing & Ren, Qin, 2025. "Intergenerational Succession in Family Businesses and the Risk of Corporate Default," Finance Research Letters, Elsevier, vol. 73(C).
    • Handle: RePEc:eee:finlet:v:73:y:2025:i:c:s1544612324015885
    DOI: 10.1016/j.frl.2024.106559
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