Abstract
The diversified management ability of the non-family members in the top management teams (TMTs) can significantly increase the research and development (R&D) investment of the family firms. However, existing studies focus on family characteristics. To bridge the gap, this study explored the R&D investment propensity for family firms from the perspective of non-family members' participation in TMTs. Based on the upper echelons and the socioemotional wealth theory, this paper incorporated the non-economic goals that influence strategic decisions on family firms into the analytical framework. According to the questionnaire data of Chinese private enterprises, the Tobit regression model was used to analyze the influence of family members on R&D investment decisions under non-economic goal orientations. The results indicated that the preference for control and influence among family members weakens the positive effect of non-family managers on R&D investment, while the preferences for status perception and social responsibility strengthen the positive effect.
Highlights
With the rapid development of science and technology and the market demand for technology, the innovation capability is considered a key driving force for technological progress and economic growth in the current market
Drawing on the upper echelons theory [26], this study argues that the family firms undertake a higher level of research and development (R&D) investment when non-family members participate in top management teams (TMTs) at high levels
Based on the traditional Chinese culture and the managerial concepts of family firms [37], this paper introduces the non-economic goals of family members, and comprehensively analyzes the joint effects of non-family factors and family factors on the R&D investment decision-making of family firms
Summary
With the rapid development of science and technology and the market demand for technology, the innovation capability is considered a key driving force for technological progress and economic growth in the current market. Family firms make a significant contribution to the global economy and the technology sector, they are often portrayed as highly conservative and risk-averse, and the effect of family ownership on firm innovation has been controversial [1, 2]. These characteristics have inspired a great deal of research on the attitudes of family firms toward research and development (R&D) investment [3,4,5,6,7,8,9]. As innovation becomes more and more important in the market, this trend will further
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