Motivated by a lack of consensus in the current literature, this paper aims to shed light on whether family firms are more or less productive than non-family firms. As a first step, this paper links existing family business research to the theoretical notion that family involvement has an influence on the factors of production from a productivity standpoint. Secondly, utilising a Cobb-Douglas framework, we provide empirical evidence that family labour and capital indeed yield diverse output contributions relative to 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 once 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.
|Title of host publication||Family Business Australia 2011 Research & Education Symposium|
|Place of Publication||Melbourne|
|Publisher||Family Business Australia|
|Number of pages||15|
|Publication status||Published - 2011|
|Event||Family Business Australia 2011 Research & Education Symposium - Perth, Australia|
Duration: 31 Aug 2011 → …
|Conference||Family Business Australia 2011 Research & Education Symposium|
|Period||31/08/11 → …|
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Financing, Firm Size and Productive Efficiency: the Effect of Family OwnershipAuthor: Barbera, F., 8 Feb 2014
Supervisor: Falvey, R. (Supervisor), Moores, K. (Supervisor) & Rajaguru, G. (Supervisor)
Student thesis: Doctoral ThesisFile