Family firms and financial performance: a meta-regression analysis

Abstract

PurposeThe purpose of this paper is to carry out a meta-regression analysis upon the literature that examines the relationship between family firms and financial performance.Design/Methodology/ApproachInformation of publication and study characteristics from 61 primary studies, comprising 726 size effects was collected. In particular, three leading factors highlighted in narrative literature reviews analyzed were: the financial performance measures, the family–firm definitions and the estimation methodologies.FindingsOverall, a positive relationship between family involvement and financial performance was found. A series of results, those linked to return on assets (ROA) – earnings before interest, taxes, depreciation and amortization (EBITDA), suggest positive publication bias from family definition and negative publication bias when OLS is used. Tobin’sQestimates show no linkage to certain traits and aspects of the research process.Originality/valueExisting literature review and meta-analysis studies show not concluding results on the family effect upon firm performance. The meta-regression analysis used in this paper allows to examine simultaneously effect size and publication bias. The latter effect is particularly salient in the approach and findings, and not present in previous studies.