Inside the Family Firm: The Role of Families in Succession Decisions and Performance
Binghamton University · National Bureau of Economic Research · +4 more institutions
Abstract
This paper uses a unique dataset from Denmark to investigate the impact of family characteristics in corporate decision making and the consequences of these decisions on firm performance. We focus on the decision to appoint either a family or external chief executive officer (CEO). The paper uses variation in CEO succession decisions that result from the gender of a departing CEO's firstborn child. This is a plausible instrumental variable (IV), as male first-child firms are more likely to pass on control to a family CEO than are female first-child firms, but the gender of the first child is unlikely to affect firms' outcomes. We find that family successions have a large negative causal impact on firm…
Citation impact
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Authors
4- MBMorten BennedsenCorresponding
Binghamton University, National Bureau of Economic Research, University of Illinois Urbana-Champaign, Copenhagen Business School, BI Norwegian Business School, New York University
- KMKasper Meisner Nielsen
Binghamton University, National Bureau of Economic Research, University of Illinois Urbana-Champaign, Copenhagen Business School, BI Norwegian Business School, New York University
- FPFrancisco Pérez‐González
Binghamton University, National Bureau of Economic Research, University of Illinois Urbana-Champaign, Copenhagen Business School, BI Norwegian Business School, New York University
- DWDaniel Wolfenzon
Binghamton University, National Bureau of Economic Research, University of Illinois Urbana-Champaign, Copenhagen Business School, BI Norwegian Business School, New York University
Topics & keywords
- Ecological succession
- Economics
- Family business
- Microeconomics
- Management
- Ecology
- Biology