Family business—A missing link in economics?

Family firms account for a substantial share of economic activity and deviate from standard economic assumptions on firm behavior. However, little is known about how these firms are represented in economic theory. This article examines the inclusion of family business in the curricula of economics doctoral programs in the United States and Sweden as well as professors’ and textbook authors’ views and research on family business. Textbooks, articles and course offerings used in doctoral programs are considered to indicate the state of established knowledge in the field. The findings show that family business is not included in the examined curricula. Furthermore, professors and authors do not publish research on family business and generally do not see a need to incorporate it into economic theory. This article concludes that family business is excluded from ‘core’ economic theory due to a lack of paradigmatic pluralism, axiomatic incompatibility, path dependency, institutional bias and data constraints. Lastly, it is speculated that integration of family business theory into standard economic modeling is likely to occur outside prestigious universities due to path dependency in research.