The impact of family involvement on the R&D intensity of publicly traded firms Articles uri icon

publication date

  • March 2011

start page

  • 62

end page

  • 70

issue

  • 1

volume

  • 24

international standard serial number (ISSN)

  • 0894-4865

electronic international standard serial number (EISSN)

  • 1741-6248

abstract

  • This study examines the impact of family involvement in ownership and control on firms' R&D intensity, relying on panel data on publicly held firms in Canada over the 2004 to 2009 time period. The literature on the link between family firms and R&D is unclear: although some characteristics may promote R&D intensity in family firms, others factors may have a negative effect. Thus, the authors propose a theoretical framework whereby differences in R&D intensity between family and nonfamily firms are explained based on key conditions, including time horizon, agency costs, resource endowment, or risk-taking behavior. The findings of this study show that publicly traded family firms in Canada record lower R&D intensity compared with nonfamily firms and, therefore, support one side of the previous literature over the other.

keywords

  • family firms ; control; ownership ; r&d intensity