How perceived risk and return interacts with familism to influence individuals’ investment strategies: The case of capital seeking and capital providing behavior in new venture financing

Thomas A. Birtch (), Kevin Yuk-fai Au (), Flora F. T. Chiang () and Peter S. Hofman ()
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Thomas A. Birtch: University of Nottingham Ningbo China
Kevin Yuk-fai Au: The Chinese University of Hong Kong
Flora F. T. Chiang: Hong Kong Baptist University
Peter S. Hofman: University of Nottingham Ningbo China

Asia Pacific Journal of Management, 2018, vol. 35, issue 2, No 8, 500 pages

Abstract: Abstract Drawing on social capital and agency theories and using a multi-study research design, this study examined how perceived risk and return interacts with familism to influence individuals’ investment strategies in new venture financing, both capital seeking and capital providing behavior. We found that individuals high in familism are more likely to seek capital from and provide capital to family members than non-family members for new ventures. However, such relationships are more complex than prior research suggests because when individuals’ risk and return perceptions are included these interact with familism to differentially influence capital financing behavior directed at family versus non-family members. Contributions to theory and potential avenues for future research are discussed.

Keywords: Familism; New venture financing; Informal investment; Social capital theory; Agency theory; Entrepreneurship; Family business (search for similar items in EconPapers)
Date: 2018
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Citations: View citations in EconPapers (4)

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DOI: 10.1007/s10490-017-9525-0

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