Family Business Groups around the World : Costs and Benefits of Pyramids

  title={Family Business Groups around the World : Costs and Benefits of Pyramids},
  author={Ronald W. Masulis and Owen},
  • Ronald W. Masulis, Owen
  • Published 2009
Using a comprehensive dataset of 28,039 firms in 45 countries, we investigate the motivations for family-controlled business groups. Contrary to expropriation theories, we find that access to capital plays a critical role in explaining group prevalence at the country level, and that within individual groups, internal equity funding, investment intensity, and firm performance all increase down a pyramidal chain, reflecting the funding advantages that pyramids offer. Controlling for endogeneity… CONTINUE READING
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