The Effect of Transgenerational Control Intention on Family-Firm Performance: It Depends Who Pursues It

Keywords

Behavioral Agency/Prospect; Family Business; Performance; Professionalization; Theory

Abstract

Transgenerational control intention (TCI) is a pivotal characteristic of many family firms. Yet, it remains unclear whether TCI benefits family-firm performance by instilling a long-term view, or hurts performance by fueling harmful socioemotional wealth (SEW) goals. We posit that it depends who pursues it. When faced with TCI, family managers are known to suffer from cognitive biases that, we submit, do not similarly apply to nonfamily managers. Thus, only family managers harm performance when pursuing TCI. An empirical investigation of 107 private German family firms supports our theory; the effect of TCI on firm performance depends on who pursues it.

Publication Date

5-1-2019

Publication Title

Entrepreneurship: Theory and Practice

Volume

43

Issue

3

Number of Pages

629-646

Document Type

Article

Personal Identifier

scopus

DOI Link

https://doi.org/10.1177/1042258717730025

Socpus ID

85051842183 (Scopus)

Source API URL

https://api.elsevier.com/content/abstract/scopus_id/85051842183

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