Stewardship vs. Stagnation: An Empirical Comparison of Small Family and Non‐Family Businesses*

Abstract Two major perspectives can be construed in the literature concerning the nature of family owned businesses (FOBs). The first implies that these enterprises have unique characteristics of stewardship. FOB owners are said to care deeply about the long‐term prospects of the business, in large part because their family's fortune, reputation and future are at stake. Their stewardship is said to be manifested by unusual devotion to the continuity of the company, by more assiduous nurturing of a community of employees, and by seeking out closer connections with customers to sustain the business. The second perspective is less flattering. It proposes that FOBs are unusually subject to stagnation: they are…