Accessibility navigation

Family involvement and firms’ establishment mode choice in foreign markets

Boellis, A., Mariotti, S., Minichilli, A. and Piscitello, L. (2016) Family involvement and firms’ establishment mode choice in foreign markets. Journal of International Business Studies, 47 (8). pp. 929-950. ISSN 1478-6990

Text - Accepted Version
· Please see our End User Agreement before downloading.


It is advisable to refer to the publisher's version if you intend to cite from this work. See Guidance on citing.

To link to this item DOI: 10.1057/jibs.2016.23


Extant literature on foreign entry increasingly recognizes firms’ heterogeneity as a potential reason for inconsistency in results on the establishment mode choice, i.e. whether and under which conditions firms should choose to enter a new country through a greenfield investment or an acquisition. Our study contributes to this debate by identifying family ownership and family involvement in management as potential powerful sources of such heterogeneity. Integrating international business studies with both corporate finance literature on family firms and recent contributions from the Socio Emotional Wealth perspective on family ownership, we claim that, due to greater risk aversion and lower access to information, the family involvement either in the firm ownership and management leads to a higher propensity towards greenfield initiatives (vs. acquisitions). However, we also find that such a propensity decreases with international experience especially in family-owned firms given the greater ability of professionalized management to overcome family-related concerns on making acquisitions. Our analysis on 1,045 foreign initiatives undertaken by 311 Italian family and non-family firms between 2003 and 2013 confirms our expectations – indicating family ownership as a significant driver of international business choices.

Item Type:Article
Divisions:Henley Business School > International Business and Strategy
ID Code:84155
Publisher:Palgrave Macmillan


Downloads per month over past year

University Staff: Request a correction | Centaur Editors: Update this record

Page navigation