Ownership Preferences, Competitive Heterogeneity, and Family-Controlled Businesses

13 Pages Posted: 12 Jun 2006

See all articles by David G. Hoopes

David G. Hoopes

California State University, Dominguez Hills

Danny Miller

HEC Montreal

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Abstract

This article models ownership concentration, owner preferences, and competitive advantage. It argues that ownership structure and owner preferences can give rise to resources and capabilities that increase firm profits. The model is then used to explain how successful family-controlled businesses (FCBs) differ from firms with less concentrated ownership and less successful FCBs. Because of their ownership concentration and reduced monitoring costs, many FCBs will have a resource surplus. That surplus and the tendency toward long-term investment among some FCBs create unique competitive opportunities under conditions we specify.

Suggested Citation

Hoopes, David G. and Miller, Danny, Ownership Preferences, Competitive Heterogeneity, and Family-Controlled Businesses. Family Business Review, Vol. 19, No. 2, pp. 89-101, June 2006. Available at SSRN: https://ssrn.com/abstract=907698 or http://dx.doi.org/10.1111/j.1741-6248.2006.00064.x

David G. Hoopes (Contact Author)

California State University, Dominguez Hills ( email )

Department of Management and Marketing
1000 E. Victoria Street
Carson, CA 90747
United States

Danny Miller

HEC Montreal ( email )

3000, Chemin de la Côte-Sainte-Catherine
Montreal, Quebec H2X 2L3 H3T 2A7
Canada

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