The 'Shadow of Succession': A Non-Parametric Matching Approach

SFB International Tax Coordination Discussion Paper No. 13

20 Pages Posted: 30 May 2008

See all articles by Sandra Diwisch

Sandra Diwisch

Vienna University of Economics and Business - Department of Economics

Peter Voithofer

affiliation not provided to SSRN

Christoph Weiss

Vienna University of Economics and Business - Department of Economics

Date Written: 2006

Abstract

The paper analyses the relationship between succession and firm performance. Applying a non-parametric matching approach on a panel of roughly 4,000 Austrian family firms we evaluate the impact of past succession as well as future succession plans on employment growth. Analysing succession plans, we do not find a 'shadow of succession' effect. No significant difference in employment growth is found between firms that plan to transfer the firm in the next ten years and those who do not. In contrast, past succession exerts a significant and positive employment growth effect which becomes stronger over time. Thus, our findings provide support for the existence of a positive employment shadow after a transfer, whereas the shadow of succession hypothesis has to be rejected prior to transition.

Keywords: succession, family firms, employment growth, matching, Austria

JEL Classification: C14, L25

Suggested Citation

Diwisch, Sandra and Voithofer, Peter and Weiss, Christoph, The 'Shadow of Succession': A Non-Parametric Matching Approach (2006). SFB International Tax Coordination Discussion Paper No. 13, Available at SSRN: https://ssrn.com/abstract=1139005 or http://dx.doi.org/10.2139/ssrn.1139005

Sandra Diwisch (Contact Author)

Vienna University of Economics and Business - Department of Economics ( email )

Augasse 2-6
A-1090 Wien
Austria

Peter Voithofer

affiliation not provided to SSRN ( email )

Christoph Weiss

Vienna University of Economics and Business - Department of Economics ( email )

Augasse 2-6
A-1090 Wien
Austria