Long–Term Orientation and Intertemporal Choice in Family Firms

A long–term orientation (LTO) is often associated with family firms, but the LTO construct is underdeveloped. This paper sets forth a framework for studying LTO in family firms including developing three dimensions—futurity, continuity, and perseverance. It identifies LTO as a higher–order heuristic that, in matters of intertemporal choice, provides a dominant logic for decisions and actions. Intertemporal choice refers to decisions with payoffs or outcomes that play out over time. Three mechanisms affecting intertemporal choices are identified—representation, self–control, and anticipation. LTO and intertemporal choice are further examined and discussed in the context of family firms.