‘Family’ Ownership, Tunnelling and Earnings Management: A Review of the Literature

26 Pages Posted: 17 Aug 2010


In this review paper, we bring together a number of aspects of family firms that are ubiquitous in a number of institutional contexts, often as part of larger business groups. We pay particular attention to the mechanisms by which families retain control over firms, and the incentives of the families in control to expropriate other stakeholders by way of tunnelling. We examine the role of earnings management in facilitating tunnelling, and evidence about the incidence of earnings management in family firms. Our review suggests that while the literature on these aspects of family control is rich, the contexts in which the empirical exercises are undertaken are relatively few, and hence there is considerable opportunity to expand it to other contexts, in particular in the form of cross-country comparisons of the relative impact of agency conflicts and institutions on these issues.

Suggested Citation

Bhaumik, Sumon Kumar and Gregoriou, Andros, ‘Family’ Ownership, Tunnelling and Earnings Management: A Review of the Literature. Journal of Economic Surveys, Vol. 24, Issue 4, pp. 705-730, September 2010, Available at SSRN: https://ssrn.com/abstract=1660107 or http://dx.doi.org/10.1111/j.1467-6419.2009.00608.x

Andros Gregoriou

University of East Anglia ( email )

Norwich Research Park
Norwich, Norfolk NR4 7TJ
United Kingdom

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