Manuscript type: Research paper Research aims: This paper investigates how family ownership affects firm’s earnings quality. The focus is on firms listed on the Korean Stock Exchange (KSE). Design/Methodology/Approach: This study uses panel data to classify family ownership into two categories: pure family ownership and ownership-control disparity (wedge) where wedge is further divided into 1) wedge ratio and 2) wedge multiplier. In addressing the category of ownership-control disparity, it is important to measure how much control rights are greater than ownership rights. Therefore, this study employs the wedge multiplier to overcome the limitation of not separating management control and ownership. Firms’ earnings quality is tested by using four proxies proposed by Jonas and Blanchet (2000): 1) persistence, 2) value relevance, 3) conservatism, and 4) accruals quality. Research findings: This research finds family ownership to be positively associated with earnings quality, value-relevance and accruals quality. However, ownership-control disparity does not reduce the earnings quality. This finding is not consistent with previous studies. Thus, it is deduced that the controlling family shareholders of the chaebol firms have a dominant influence on firms which they invested in by using affiliated ownership. Significant ownership-control disparity is prevalent in chaebol firms, resulting in low earnings quality. Theoretical contribution/Originality: Family ownership is predominant in a number of countries, especially in East-Asian countries. In that regard, this study is important. It contributes to the understanding of family ownerships and firms’ earnings quality not only for the Korean contexts, but also for other East Asian countries. Research limitation/Implications: The four proxies of earnings quality used in this study do not necessarily reflect all aspects of the earnings quality. In this study, the results between family ownership and earnings quality are mixed. The results based on the association between corporate governance and earnings quality could be attributed to the way earnings quality is defined. The management of the chaebol firms or large business groups should try to improve transparency and the quality of their financial reporting.Keywords: Chaebol, Earnings Quality, Family Ownership, Panel Data, Wedge JEL Classification: G32, G34, M41