Does family ownership structure affect investment-cash flow sensitivity? Evidence from Italian SMEs

Valentina Peruzzi

Applied Economics, 2017, vol. 49, issue 43, 4378-4393

Abstract: The aim of this article is to investigate whether family control, family management and family ownership concentration affect the investment-cash flow sensitivity of small- and medium-sized enterprises (SMEs). By analysing a sample of Italian SMEs for the period 2004–2013, I find that family-owned businesses are significantly associated with higher investment-cash flow dependence. This relation, however, is found to be driven by two distinct factors: (i) the presence of a highly concentrated family ownership (ownership concentration channel) and (ii) the active involvement of the family in the business (family management channel).

Date: 2017
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Working Paper: Does family ownership structure affect investment-cash flow sensitivity? Evidence from Italian SMEs (2017)
Working Paper: Does family ownership structure affect investment-cash flow sensitivity? Evidence from Italian SMEs (2015)
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DOI: 10.1080/00036846.2017.1282147

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