Abstract
This study intends to investigate the impact of family control on bank financing and the cost of debt by utilising a survey research design to collect survey data. Canadian small family business owners were asked about their perceptions of family ownership, family members' firm management, CEO duality, bank financing, and debt cost. Our empirical analysis shows that family members' higher level of family ownership and firm management increases bank financing and decreases the cost of debt. A three-stage least square regressions show that family control/governance decreases the cost of debt through bank financing access. Thus, family control/governance plays a role in increasing bank financing and reducing debt costs for Canadian small family business firms. The results contribute to the literature on the relations between family control, bank financing, and debt cost. This study may motivate research scholars to develop further studies on family control/governance and the cost of capital.
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