Review of Managerial Science

, Volume 7, Issue 3, pp 247–275 | Cite as

Capital structure decisions in family firms: empirical evidence from a bank-based economy

  • Markus Ampenberger
  • Thomas Schmid
  • Ann-Kristin Achleitner
  • Christoph Kaserer
Original Paper


This paper analyzes the question if and how founding families influence the capital structure decision of their firms. By using a unique, partially hand-collected panel dataset of 660 listed German companies (5,135 firm years) over the period 1995–2006, we come up with the following results: German family firms have significantly lower leverage ratios than non-family firms. With respect to the question how families influence the capital structure of their firms, we can show that the family impact is mostly driven via management involvement. In this context, we also detect that the presence of a founder CEO has a strong negative effect on the leverage ratio. Our results prove to be stable against a battery of robustness tests, including the influence of other types of blockholders and the firms’ life cycle. Moreover, we use a propensity-score based matching estimator to alleviate concerns of reverse causality. Overall, our study suggests a strong, negative and causal relationship between family firm characteristics (especially family management) and the level of leverage.


Family firms Capital structure Leverage Agency conflicts 

JEL Classification

G32 G34 



We thank Andrew Ellul, Jana Fidrmuc, Randall Morck, Paolo Rodriguez, two anonymous referees and seminar participants at the Corporate Governance Workshop 2009 in Copenhagen, the 5th EIASM Workshop on Family Firms Management Research 2009 in Hasselt, the European Finance Association 2009 annual meeting in Bergen and the German Finance Association 2009 annual meeting in Frankfurt for their helpful comments and suggestions.


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Copyright information

© Springer-Verlag 2011

Authors and Affiliations

  • Markus Ampenberger
    • 1
  • Thomas Schmid
    • 1
  • Ann-Kristin Achleitner
    • 1
  • Christoph Kaserer
    • 1
  1. 1.Center for Entrepreneurial and Financial Studies (CEFS)Technische Universität MünchenMunichGermany

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