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Productivity and Survival of Family Firms in Japan: An Analysis Using Firm-Level Microdata

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  • MORIKAWA Masayuki

Abstract

This article, by using a unique dataset of a large number of Japanese firms, empirically investigates the relationship between the structure of shareholding and productivity, survival, and managerial objectives. The focus is on the distinct traits of family firms, which compose the majority of Japanese firms. According to the results, the managerial objectives and performance of family firms are qualitatively and quantitatively different from those of non-family firms. Specifically, 1) productivity growth of family firms are significantly slower than non-family firms, after controlling for firm size, firm age, and industry; 2) family firms' probability of survival is higher than that of non-family firms; and 3) even after controlling for the high propensity to survive, family firms' productivity growth is slower. As family firms' management objectives are different from non-family firms, these results cannot be interpreted normatively. However, it is desirable to expand ownership options by reducing barriers to going public or transferring ownership.

Suggested Citation

  • MORIKAWA Masayuki, 2008. "Productivity and Survival of Family Firms in Japan: An Analysis Using Firm-Level Microdata," Discussion papers 08026, Research Institute of Economy, Trade and Industry (RIETI).
    • Handle: RePEc:eti:dpaper:08026
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    Cited by:

    1. MORIKAWA Masayuki, 2008. "What Do Japanese Unions Do for Productivity?: An Empirical Analysis Using Firm-Level Data," Discussion papers 08027, Research Institute of Economy, Trade and Industry (RIETI).
    2. MORIKAWA Masayuki, 2013. "Business Restructuring of Japanese Firms: Structural changes during the "Lost Decades"," Discussion papers 13083, Research Institute of Economy, Trade and Industry (RIETI).

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