Strategic Implications of Familiness

Sumon Bhaumik and Ralitza Dimova
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Ralitza Dimova: University of Manchester

Chapter 3 in How Family Firms Differ, 2015, pp 43-67 from Palgrave Macmillan

Abstract: Abstract In the previous chapter, we concluded that familiness is the key source of distinction between family and non-family firms. Its direct implication — which is implicit in the discussion in Chapter 2 — is that it is erroneous to think about agency problems within family firms and familiness as two distinct prisms through which we can examine family firms and their strategic behaviour. Indeed, agency problem within family firms is — at least in part — an outcome of familiness. Lubatkin et al. (2005) summarised the relationship between familiness and agency problems within these firms elegantly using Figure 3.1. The interpretation of the diagram, which emphasises the agency problems that result from altruism, follows easily from the discussion in Chapter 2 and we shall discuss its implications for strategies of family firms later in this chapter.

Keywords: Corporate Governance; Family Firm; Family Business; Agency Problem; Trade Credit (search for similar items in EconPapers)
Date: 2015
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Persistent link: https://EconPapers.repec.org/RePEc:pal:palchp:978-1-137-47358-5_3

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DOI: 10.1057/9781137473585_3

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