The Survival of Family Firms: The Importance of Control and Family Ties |
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| Authors: | Enrico Santarelli Francesca Lotti |
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| Affiliation: | 1. Enrico Santarelli, Economics Department , University of Bologna , Strada Maggiore 45 , 40125 Bologna , Italy E-mail: santarel@spbo.unibo.it;2. Max Planck Institute for Research into Economic Systems—Entrepreneurship, Growth and Public Policy Group, Jena;3. and ENCORE, Amsterdam and Francesca Lotti, Research Department , Bank of Italy, via Nazionale 91 , 00184 Rome , Italy E-mail: francesca.lotti@bancaditalia.it |
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| Abstract: | The aim of this article is to analyze the survival patterns of a group of family firms which have already spent at least 25 years in the market. To this end, we use the Kaplan–Meier product limit estimator supplemented with qualitative information gathered by direct observation and discussions with entrepreneurs. The main findings are that small family firms which have reached their 30th year in the market face a very high risk of sudden exit, increasing with firm age. Further control carried out by means of interviews with entrepreneurs identifies problems connected with succession as one of the main causes of the decision to close down. |
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| Keywords: | Succession Survival Function Kaplan–Meier Estimator Hazard Function Italy JEL Classifications: L20, C34, C41, M13 |
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