The performance of family-managed firms is mixed. To understand the drivers of variation, the authors conducted a meta-analysis of 204 studies covering 3.8 million firms. They find that family businesses tend to suffer in countries where trust in family is high and trust in institutions is low. The best family-firm performers, though, are in countries that score high on trust in both areas, suggesting that the institutional factor is more important.

Globally, family businesses comprise 75% of all firms and contribute 65% to GDP. However, evidence of whether families improve or impair their companies’ performance remains mixed and is ardently debated.

In order to better understand the findings of prior studies, we conducted a meta-analysis (together with the University of Trier’s Joern Block and Dominik Wagner of IUBH International College) that combined 204 academic studies covering 3,880,267…

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