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Leadership and firm value among couples in charge: Evidence from Chinese listed family firms

Author

Listed:
  • Na Wu
  • Xinping Xia
  • Yuguo Li

Abstract

This study investigates how leadership by married couples affects the firm value of family businesses in the institutional context of the Chinese capital market. Marital leadership is found to significantly decrease firm value compared with other family firms, which is supported by a battery of estimation strategies. Aggravating the principal–principal problem, tunnelling behaviour and financial fraud are confirmed as potential economic mechanisms. Moreover, monitoring from the internal corporate governance and external institution environment helps marital leadership focus on shareholder wealth beyond family interest. Our findings indicate that marital leadership implies more of a collusion effect than a collaboration effect in China.

Suggested Citation

  • Na Wu & Xinping Xia & Yuguo Li, 2023. "Leadership and firm value among couples in charge: Evidence from Chinese listed family firms," Pacific Economic Review, Wiley Blackwell, vol. 28(3), pages 409-445, August.
    • Handle: RePEc:bla:pacecr:v:28:y:2023:i:3:p:409-445
    DOI: 10.1111/1468-0106.12414
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    References listed on IDEAS

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