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Global Sourcing of Familiy Firms

Daniel Horgos

No 106/2010, Working Paper from Helmut Schmidt University, Hamburg

Abstract: In Europe, a huge share of firms is family owned. Since family firms are known to be more risk averse concerning international transactions, an interesting question emerges: Do family firms adopt a different international sourcing pattern. Altering the Gloubal Sourcing model of Antràs and Helpman, this theoretical contribution adopts a family firm's perspective. The model shows that family firms tend to decrease international procurement. In the headquarter intensive sector, where FDI coexists with international outsourcing, family firms unambiguously decrease FDI, whereas the effect on international outsourcing is ambiguous: A substitution process may work towards an increase in international outsourcing activities.

Keywords: Global Sourcing; Family Firms; Outsourcing; Offshoring; FDI (search for similar items in EconPapers)
JEL-codes: D23 F10 L23 (search for similar items in EconPapers)
Pages: 22 pages
Date: 2010-12-15
New Economics Papers: this item is included in nep-bec and nep-int
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