Abstract
This study examines how participative decision‐making and generational ownership dispersion affect conflict in a sample of privately held U.S. family firms. Our study utilizes a hierarchical linear model approach to investigate “cross‐level” effects between variables from different levels of analysis. Participative decision‐making among family members was found to be associated with cognitive and relationship conflict. Furthermore, the relationship between participative decision‐making and conflict as individual‐level variables was moderated by generational ownership dispersion, a firm‐level variable. When ownership was dispersed through multiple generations, participative decision‐making was found to be positively related to cognitive and relationship conflict; however, in one‐ and two‐generation ownership firms participative decision‐making was found to be negatively related to cognitive and relationship conflict.
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