Abstract
Motivated by a lack of consensus in the current literature, the objective of this paper is to reveal whether family firms are more or less productive than non-family firms. As a first step, this paper links family business research to the theoretical notion that family involvement has an effect on the factors of production from a productivity standpoint. Second, by using a Cobb-Douglas framework, we provide empirical evidence that family labour and capital indeed yield diverse output contributions compared with their non-family counterparts. In particular, family labour output contributions are significantly higher, and family capital output contributions significantly lower. Interestingly, differences in total factor productivity between family and non-family firms disappear when we allow for heterogeneous output contributions of family production inputs. These findings imply that the assumption of homogeneous labour and capital between family and non-family firms is inappropriate when estimating the production function.
Original language | English |
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Pages (from-to) | 953-976 |
Number of pages | 24 |
Journal | Small Business Economics |
Volume | 40 |
Issue number | 4 |
Early online date | 19 Nov 2011 |
DOIs | |
Publication status | Published - May 2013 |
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Dive into the research topics of 'Firm ownership and productivity: A study of family and non-family SMEs'. Together they form a unique fingerprint.Student theses
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Financing, Firm Size and Productive Efficiency: the Effect of Family Ownership
Author: Barbera, F., 8 Feb 2014Supervisor: Falvey, R. (Supervisor), Moores, K. (Supervisor) & Rajaguru, G. (Supervisor)
Student thesis: Doctoral Thesis
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