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

Valentina Peruzzi

No wpC16, CERBE Working Papers from CERBE Center for Relationship Banking and Economics

Abstract: The aim of this paper is to investigate whether family control, family management and family ownership concentration affect the investment-cash flow sensitivity of small- and medium-sized enterprises. 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).

Keywords: family firms; investment-cash flow sensitivity; financing constraints; family CEO; ownership concentration. (search for similar items in EconPapers)
JEL-codes: G31 G32 (search for similar items in EconPapers)
Pages: 38 pages
Date: 2017-01
New Economics Papers: this item is included in nep-acc, nep-cfn, nep-eur and nep-sbm
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (9)

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https://repec.lumsa.it/wp/wpC16.pdf (application/pdf)

Related works:
Journal Article: 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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