Abstract
This paper examines whether founding-family ownership affects firms’ labour investment efficiency. By analysing public Korean companies from 2001 to 2018, we found that family firms are more efficient than non-family firms in regard to labour investment. The results show that family firms can achieve greater efficiency in labour investment by avoiding over-firing issues, thereby reducing underinvestment in employment problems. Additionally, we found that family firms make more efficient labour-related decisions with greater external financing. Overall, the results suggest that family firms’ long-term perspective enables them to maintain optimal labour levels.
Original language | English |
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Pages (from-to) | 1073-1078 |
Number of pages | 6 |
Journal | Applied Economics Letters |
Volume | 29 |
Issue number | 12 |
DOIs | |
State | Published - 2022 |
Keywords
- family firms
- family ownership
- investment efficiency
- labour investment
- Ownership structure