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The impacts of family involvement on R&D investment intensity in firms: Evidence from China

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Abstract

Drawing on the perspective of socioemotional wealth, this paper explores the types of family involvement in family firms and their impacts on R&D investment intensity. Using data from the forecasts issued by A-share family firms listed on Chinese stock markets between 2008 and 2019, the study finds that the separation of ownership and control is negatively associated with R&D investment intensity in non-high-tech firms, whereas potential gains of socioemotional wealth from R&D activities by high-tech firms produce a positive influence that offsets the negative impact of the separation of ownership and control on R&D investments. It reveals the importance of gains of socioemotional wealth. In contrast to the separation of ownership and control, family involvement in management is negatively associated with firms’ R&D investment intensity in both high-tech firms and non-high-tech firms. Our results capture the diversity of family members’ identity recognition, which leads to family members’ different evaluations of the potential gains and losses of socioemotional wealth. Overall, the distinction between high-tech family firms and other family firms is shown to be significant, as is the distinction between the impacts of different types of family involvement.

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Acknowledgements

The authors gratefully acknowledge comments and suggestions made by the referees.

Funding

This work was supported by the National Social Science Fund of China (Grant Number 21BGL108).

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Authors and Affiliations

  1. School of Economics, Hangzhou Normal University, Zhejiang, Hangzhou, China

    Minglin Wang, Mengna Xu & Qiuqin He

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  1. Minglin Wang
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  2. Mengna Xu
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  3. Qiuqin He
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Correspondence to Mengna Xu.

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Wang, M., Xu, M. & He, Q. The impacts of family involvement on R&D investment intensity in firms: Evidence from China. Int Entrep Manag J 18, 277–294 (2022). https://doi.org/10.1007/s11365-022-00794-6

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