DP15398 Dynastic Control without Ownership: Evidence from Post-war Japan
|Author(s):||Morten Bennedsen, Vikas Mehrotra, Jungwook Shim, Yupana Wiwattanakantang|
|Publication Date:||October 2020|
|Keyword(s):||Family control, ownership, Succession|
|Programme Areas:||Financial Economics|
|Link to this Page:||cepr.org/active/publications/discussion_papers/dp.php?dpno=15398|
Dynastic-controlled firms are led by founding family CEOs while the family owns an insignificant share of equity (defined as less than five percent). They represent 7.4% of listed firms in post-war Japan, include well-known firms such as Casio, Suzuki and Toyota, and are often grouped with widely-held firms in the literature. These firms differ in key performance measures from both traditional family firms and non-family firms, and evolve from the former as equity-financed growth dilutes the founding family's ownership over time. In turn, the transition from dynastic control to non-family status is driven by a diminution of strategic family resources.