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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.

Suggested Citation

  • Marco Cucculelli, 2008. "Owner Identity and Firm Performance: Evidence from European Companies," Rivista di Politica Economica, SIPI Spa, vol. 98(2), pages 149-178, March-Apr.
    • Handle: RePEc:rpo:ripoec:v:98:y:2008:i:2:p:149-178
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    References listed on IDEAS

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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. Claudia Pongelli & Matteo Giuliano Caroli & Marco Cucculelli, 2016. "Family business going abroad: the effect of family ownership on foreign market entry mode decisions," Small Business Economics, Springer, vol. 47(3), pages 787-801, October.
    3. Magda Bianco & Maria Bontempi & Roberto Golinelli & Giuseppe Parigi, 2013. "Family firms’ investments, uncertainty and opacity," Small Business Economics, Springer, vol. 40(4), pages 1035-1058, May.
    4. Bianco, Madga & Golinelli, Roberto & Parigi, Giuseppe, 2009. "Family firms and investments," MPRA Paper 19247, University Library of Munich, Germany.
    5. 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.
    6. Yeh, Yin-Hua & Liao, Chen-Chieh, 2021. "Are non-family successors all the same? Inside-promoted vs. outside-sourced," Journal of Corporate Finance, Elsevier, vol. 71(C).
    7. Valentina Peruzzi, 2017. "Does family ownership structure affect investment-cash flow sensitivity? Evidence from Italian SMEs," Applied Economics, Taylor & Francis Journals, vol. 49(43), pages 4378-4393, September.
    8. Matteo Bugamelli & Francesca Lotti & Monica Amici & Emanuela Ciapanna & Fabrizio Colonna & Francesco D�Amuri & Silvia Giacomelli & Andrea Linarello & Francesco Manaresi & Giuliana Palumbo & Filippo , 2018. "Productivity growth in Italy: a tale of a slow-motion change," Questioni di Economia e Finanza (Occasional Papers) 422, Bank of Italy, Economic Research and International Relations Area.

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    More about this item

    Keywords

    owner identity; SMEs; risk aroidance; family firms.;
    All these keywords.

    JEL classification:

    • G32 - Financial Economics - - Corporate Finance and Governance - - - Financing Policy; Financial Risk and Risk Management; Capital and Ownership Structure; Value of Firms; Goodwill
    • L25 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Firm Performance

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