Family Firms

Mike Burkart, Fausto Panunzi and Andrei Shleifer

Journal of Finance, 2003, vol. 58, issue 5, 2167-2201

Abstract: We present a model of succession in a firm owned and managed by its founder. The founder decides between hiring a professional manager or leaving management to his heir, as well as on what fraction of the company to float on the stock exchange. We assume that a professional is a better manager than the heir, and describe how the founder's decision is shaped by the legal environment. This theory of separation of ownership from management includes the Anglo‐Saxon and the Continental European patterns of corporate governance as special cases, and generates additional empirical predictions consistent with cross‐country evidence.

Date: 2003
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Citations: View citations in EconPapers (45)

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https://doi.org/10.1111/1540-6261.00601

Related works:
Working Paper: Family firms (2003)
Working Paper: Family Firms (2003)
Working Paper: Family Firms (2002)
Working Paper: Family firms (2002)
Working Paper: Family Firms (2002)
Working Paper: Family Firms (2002)
Working Paper: Family Firms (2002)
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Persistent link: https://EconPapers.repec.org/RePEc:bla:jfinan:v:58:y:2003:i:5:p:2167-2201

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