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The Role of Family Ownership on Internationalization Strategies

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  • Joana Costa

    (DEGEIT—Department of Economics, Management, Industrial Engineering and Tourism, University of Aveiro, Campus Universitário de Santiago, 3810-193 Aveiro, Portugal
    GOVCOPP—Research Unit on Governance, Competitiveness and Public Policies, Campus Universitário de Santiago, 3810-193 Aveiro, Portugal
    INESCTEC—Institute for Systems and Computer Engineering, Technology and Science, R. Roberto Frias, 4200-465 Porto, Portugal)

  • João Barbosa

    (DEGEIT—Department of Economics, Management, Industrial Engineering and Tourism, University of Aveiro, Campus Universitário de Santiago, 3810-193 Aveiro, Portugal)

Abstract

The present study examines the impact of family ownership and control on the internationalization strategies of Portuguese manufacturing firms. The study contributes to the existing literature by providing evidence that different forms of international market presence are asymmetrically influenced by family control and by underscoring the importance of innovative strategies. The analysis includes a sample of 25,533 firms observed from 2018 to 2021. Econometric models address the role of ownership in alternative internationalization endeavors, demonstrating that these firms differ from their non-family counterparts. By comparing the export propensity, intensity, and reach of family businesses to non-family businesses, the research sheds light on the challenges faced by family-owned firms and the significance of structural characteristics such as technological regimes and regional competitive advantages. The findings emphasize the negative impact of family presence on internationalization while highlighting the importance of innovation and ecosystem support. Additionally, the study contributes to the empirical refinement of firm classification by proposing a more reliable segmentation method. It also presents alternative econometric methods to appraise internationalization strategies better. Future research directions are suggested, particularly regarding the use of additional information related to innovation and human capital, offering insights for enhancing the global engagement of family businesses in global markets. This research provides valuable empirical evidence and practical implications for policymakers and practitioners seeking to support the required actions to promote the growth and internationalization of family businesses in the context of the Portuguese manufacturing industry.

Suggested Citation

  • Joana Costa & João Barbosa, 2024. "The Role of Family Ownership on Internationalization Strategies," Administrative Sciences, MDPI, vol. 14(2), pages 1-24, February.
    • Handle: RePEc:gam:jadmsc:v:14:y:2024:i:2:p:29-:d:1332295
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    References listed on IDEAS

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    1. Baronchelli, Gianpaolo & Bettinelli, Cristina & Del Bosco, Barbara & Loane, Sharon, 2016. "The impact of family involvement on the investments of Italian small-medium enterprises in psychically distant countries," International Business Review, Elsevier, vol. 25(4), pages 960-970.
    2. Calabrò, Andrea & Torchia, Mariateresa & Pukall, Thilo & Mussolino, Donata, 2013. "The influence of ownership structure and board strategic involvement on international sales: The moderating effect of family involvement," International Business Review, Elsevier, vol. 22(3), pages 509-523.
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