Family Firms, Paternalism and Labour Relations

Holger M Mueller and Thomas Philippon

No 6017, CEPR Discussion Papers from C.E.P.R. Discussion Papers

Abstract: Using firm-, industry-, and country-level data, we document a link between family ownership and labour relations. Across countries, we find that family ownership is relatively more prevalent in countries in which labour relations are difficult, consistent with firm-level evidence suggesting that family firms are particularly effective at coping with difficult labour relations. Our cross-country results are robust to controlling for minority shareholder protection and other potential determinants of family ownership. Our results also hold if we use strike data from the 1960s to predict cross-country variation in family ownership thirty years later. We address causality in two ways. First, we instrument our measure of the quality of labour relations using 'Labour Origin', a variable describing the extent to which the emerging European liberal states in the 18th and 19th centuries confronted guilds and labour organizations. Second, making use of within-country variation at the industry level, we show that - controlling for industry and country fixed effects - industries that are more labour dependent have relatively more family ownership in countries with worse labour relations.

Keywords: family firms; labour relations (search for similar items in EconPapers)
JEL-codes: G32 J52 J53 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-bec
Date: Written
View list of references

Downloads: (external link)
http://www.cepr.org/pubs/dps/DP6017.asp (application/pdf)
CEPR Discussion Papers are free to download for our researchers, subscribers and members. If you fall into one of these categories but have trouble downloading our papers, please contact us at subscribers@cepr.org

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: http://EconPapers.repec.org/RePEc:cpr:ceprdp:6017

Ordering information: This working paper can be ordered from
http://www.cepr.org/pubs/dps/DP6017.asp

Access Statistics for this paper

More papers in CEPR Discussion Papers from C.E.P.R. Discussion Papers
Address: Centre for Economic Policy Research, 53--56 Great Sutton Street, London EC1V 0DG
Series data maintained by ().