Intergenerational Succession in Family Businesses and the Risk of Corporate Default

JiaYing Deng and Qin Ren

Finance Research Letters, 2025, vol. 73, issue C

Abstract: This study empirically investigates the impact of intergenerational succession in family businesses on corporate default risk, specifically targeting family-listed firms in China's Shanghai and Shenzhen A-share markets. The results reveal that intergenerational succession significantly lowers corporate default risk. Mechanism tests further suggest that this reduction in default risk is indirectly achieved by curbing the scale of corporate investment activities. Heterogeneity analysis indicates that the decrease in corporate default risk associated with intergenerational succession is most pronounced in firms facing high liquidity constraints.

Keywords: Family business succession; Corporate default risk (search for similar items in EconPapers)
Date: 2025
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Persistent link: https://EconPapers.repec.org/RePEc:eee:finlet:v:73:y:2025:i:c:s1544612324015885

DOI: 10.1016/j.frl.2024.106559

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