Transgenerational control intention and employment practices of family firms in China

Abstract

PurposeThis study aims to examine the employment practices of family firms in emerging markets. Drawing from the social exchange theory, the authors propose that transgenerational control intention enhances the motivation for family owners to engage in favorable employment practices as inducement for future contribution of employees.Design/methodology/approachMultilevel regression models were applied to test the hypotheses with a sample of 3033 Chinese private family firms.FindingsThe results show that the employment practices of family firms are positively associated with transgenerational control intention, and the effect of transgenerational control intention is contingent on regional social trust.Originality/valueThis study highlights the role of transgenerational control intention of family owners in motivating favorable employment in family firms. The study adds nuance to the variances in employment behaviors of family firms as well as the family owner-employee exchange relationship in emerging markets.