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Research output: Contribution to Journal/Magazine › Journal article › peer-review
Research output: Contribution to Journal/Magazine › Journal article › peer-review
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TY - JOUR
T1 - Family Control and Family Firm Valuation by Family CEOs: The Importance of Intentions for Transgenerational Control
AU - Zellweger, Thomas M.
AU - Kellermanns, Franz W.
AU - Chrisman, James J.
AU - Chua, Jess H.
PY - 2012/5/1
Y1 - 2012/5/1
N2 - Family firms are thought to pursue nonfinancial goals that provide socioemotional wealth, but socioemotional wealth is feasible only with family control of the firm. Using prospect theory, we hypothesize that socioemotional wealth increases with the extent of current control, duration of control, and intentions for transgenerational control, thus adding to the price at which owners would be willing to sell their firms to nonfamily buyers. Findings from two countries show that current control has no impact, and duration of control has a mixed impact. However, intention for transgenerational control has a consistently positive impact on the perceived acceptable selling price.
AB - Family firms are thought to pursue nonfinancial goals that provide socioemotional wealth, but socioemotional wealth is feasible only with family control of the firm. Using prospect theory, we hypothesize that socioemotional wealth increases with the extent of current control, duration of control, and intentions for transgenerational control, thus adding to the price at which owners would be willing to sell their firms to nonfamily buyers. Findings from two countries show that current control has no impact, and duration of control has a mixed impact. However, intention for transgenerational control has a consistently positive impact on the perceived acceptable selling price.
KW - endowment effect
KW - prospect theory
KW - family business
KW - socioemotional wealth
KW - transgenerational control
KW - firm valuation
U2 - 10.1287/orsc.1110.0665
DO - 10.1287/orsc.1110.0665
M3 - Journal article
VL - 23
SP - 851
EP - 868
JO - Organization Science
JF - Organization Science
SN - 1047-7039
IS - 3
ER -