R&D investments in family and founder firms: an agency perspective

Joern Block

Research output: Contribution to journalArticleAcademicpeer-review

443 Citations (Scopus)

Abstract

Investments in R&D can influence a firm's ability to develop new products and to create and adopt innovative technologies that may enhance productivity. However, due to uncertainty regarding the outcome, investments in R&D may lead to an agency problem between the owners and the managers of a firm. Family and founder firms are often considered to be different in their agency situation than other firms, which may have an influence on R&D investments. This paper analyzes R&D spending in family and founder firms versus other firms. The results show that while family ownership decreases the level of R&D intensity, ownership by lone founders has a positive effect not only on R&D intensity but also on the level of R&D productivity. The paper contributes to the understanding of the role of entrepreneurship in making high risk/high return R&D decisions.
Original languageEnglish
Pages (from-to)248-265
Number of pages18
JournalJournal of Business Venturing
Volume27
Issue number2
DOIs
Publication statusPublished - 2012

Research programs

  • EUR ESE 30

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