Family Firm Research – A Review

China Journal of Accounting Research 7 (2014): 149-163

15 Pages Posted: 15 Aug 2014 Last revised: 1 Oct 2014

See all articles by Qiang Cheng

Qiang Cheng

Singapore Management University

Multiple version iconThere are 2 versions of this paper

Date Written: August 14, 2014


This article reviews family firm studies in the finance and accounting literature, primarily those conducted using data from the United States and China. Family owners have unique features such as concentrated ownership, long investment horizon, and reputation concerns. Given the distinguishing features of family ownership and control, family firms face unique agency conflicts. We discuss the agency problems in family firms and review the findings of recent family firm studies. We call for more research to understand the unique family effects and encourage more research on Chinese family firms.

Part I of the article discusses the fundaments of family firms: the prevalence of and the agency conflicts within family firms. Part II summarizes the findings of recent U.S. family firm studies. It reviews the evidence on the family firm premium (how, which, and when family firms are associated with a valuation premium), the manifestation of the agency conflict between majority and minority shareholders in family firms, earnings quality and corporate disclosure, and the determinants of family ownership and control. Part III discusses the prevalence and characteristics of Chinese family firms and reviews the findings of related studies. The article concludes with some suggestions for future research.

Keywords: family firms, ownership structure, agency problems, controlling owners, minority owners

JEL Classification: G30, G32, G38, M20, M41

Suggested Citation

Cheng, Qiang, Family Firm Research – A Review (August 14, 2014). China Journal of Accounting Research 7 (2014): 149-163, Available at SSRN:

Qiang Cheng (Contact Author)

Singapore Management University ( email )

60 Stamford Road
Singapore, 178900

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