Terrorism and Resilience: How Family Businesses Respond to Terrorist Activity

Luis Alfonso Dau, Elizabeth M Moore, Katharine Petrich and Max Abrahms

Chapter 25 in Handbook of Global Financial Markets:Transformations, Dependence, and Risk Spillovers, 2019, pp 647-668 from World Scientific Publishing Co. Pte. Ltd.

Abstract: The purpose of this chapter is to explain the impact of global security threats on the performance of family firms. A large body of theoretical and empirical research analyzes the impact of terrorism on governments, but it is also important to understand the effects on other types of actors. This is among the first analyses of terrorism’s effects on family business. We argue that family businesses tend to be more resilient to terrorist activity due to superior social capital stemming from the strength of their social ties and motivation to persevere. Further, we propose that family firm performance in the aftermath of terrorist activity is positively moderated by institutional quality, which can both mitigate contextual complications and provide stability. A case study analysis of Indian family firms is developed to substantiate these arguments.

Keywords: Market Integration; Risk Management; Risk Assessment; Financial Uncertainty; Volatility; Financial Markets; Financial Development; Country Risks; Sovereign Debt Markets (search for similar items in EconPapers)
JEL-codes: F37 (search for similar items in EconPapers)
Date: 2019
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