Review of Financial Studies Vol. 25 No. 6 2012

The Life Cycle of Family Ownership: International Evidence

Julian Franks¹; Colin Mayer²; Paolo F. Volpin¹; Hannes F. Wagner³

¹ London Business School · ² University of Oxford · ³ Bocconi University

Abstract

We show that in countries with strong investor protection, developed financial markets, and active markets for corporate control, family firms evolve into widely held companies as they age. In countries with weak investor protection, less developed financial markets, and inactive markets for corporate control, family control is very persistent over time. While family control in high investor protection countries is concentrated in industries that have low investment opportunities and low merger and acquisition (M&A) activity, the same is not so in countries that have low investor protection, where the presence of family control in an industry is unrelated to investment opportunities and M&A activity.

DOI

10.1093/rfs/hhr135

Volume

25

Issue

6

Pages

1675-1712

Language

en

Sources

openalex crossref