The Life Cycle of Family Ownership: International Evidence

68 Pages Posted: 6 Mar 2008 Last revised: 25 Oct 2011

See all articles by Julian R. Franks

Julian R. Franks

London Business School - Institute of Finance and Accounting; Centre for Economic Policy Research (CEPR); European Corporate Governance Institute (ECGI)

Colin Mayer

University of Oxford - Said Business School; Centre for Economic Policy Research (CEPR); European Corporate Governance Institute (ECGI)

Paolo F. Volpin

Drexel University - Bennett S. LeBow College of Business; Centre for Economic Policy Research (CEPR); European Corporate Governance Institute (ECGI); City University London - Faculty of Finance

Hannes F. Wagner

Bocconi University - Department of Finance; Bocconi University - IGIER - Innocenzo Gasparini Institute for Economic Research; European Corporate Governance Institute (ECGI)

Date Written: September 2, 2011

Abstract

We show that in countries with strong investor protection, developed financial markets and active markets for corporate control, family firms evolve into widely held companies as they age. In countries with weak investor protection, less developed financial markets and inactive markets for corporate control, family control is very persistent over time. While family control in high investor protection countries is concentrated in industries with low investment opportunities and low M&A activity, this is not so in countries with low investor protection, where the presence of family control in an industry is unrelated to investment opportunities and M&A activity.

Keywords: ownership, family firms, life cycle, corporate performance

JEL Classification: G32, G34

Suggested Citation

Franks, Julian R. and Mayer, Colin and Volpin, Paolo F. and Wagner, Hannes F., The Life Cycle of Family Ownership: International Evidence (September 2, 2011). EFA 2009 Bergen Meetings Paper, AFA 2009 San Francisco Meetings Paper, Paris December 2011 Finance Meeting EUROFIDAI - AFFI, Available at SSRN: https://ssrn.com/abstract=1102475 or http://dx.doi.org/10.2139/ssrn.1102475

Julian R. Franks

London Business School - Institute of Finance and Accounting ( email )

Institute of Finance and Accounting
Sussex Place - Regent's Park
London NW1 4SA
United Kingdom
+44 20 7262 5050 x3449 (Phone)
+44 20 7724 3317 (Fax)

Centre for Economic Policy Research (CEPR)

London
United Kingdom

European Corporate Governance Institute (ECGI)

c/o the Royal Academies of Belgium
Rue Ducale 1 Hertogsstraat
1000 Brussels
Belgium

HOME PAGE: https://ecgi.global/

Colin Mayer

University of Oxford - Said Business School ( email )

Park End Street
Oxford, OX1 1HP
Great Britain
+44 1865 288112 (Phone)
+44 1865 288805 (Fax)

Centre for Economic Policy Research (CEPR)

London
United Kingdom

European Corporate Governance Institute (ECGI)

c/o the Royal Academies of Belgium
Rue Ducale 1 Hertogsstraat
1000 Brussels
Belgium

HOME PAGE: http://www.ecgi.org

Paolo F. Volpin

Drexel University - Bennett S. LeBow College of Business ( email )

101 N. 33rd St.
Philadelphia, PA 19104
United States

Centre for Economic Policy Research (CEPR)

London
United Kingdom

European Corporate Governance Institute (ECGI)

c/o ECARES ULB CP 114
B-1050 Brussels
Belgium

HOME PAGE: http:/www.ecgi.org

City University London - Faculty of Finance ( email )

London, EC2Y 8HB
Great Britain

Hannes F. Wagner (Contact Author)

Bocconi University - Department of Finance ( email )

Via Roentgen 1
Milano, MI 20136
Italy

HOME PAGE: http://mypage.unibocconi.eu/hanneswagner

Bocconi University - IGIER - Innocenzo Gasparini Institute for Economic Research ( email )

Via Roentgen 1
Milan, 20136
Italy

European Corporate Governance Institute (ECGI) ( email )

c/o the Royal Academies of Belgium
Rue Ducale 1 Hertogsstraat
1000 Brussels
Belgium

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