Content uploaded by Rodrigo Basco
Author content
All content in this area was uploaded by Rodrigo Basco on Feb 24, 2021
Content may be subject to copyright.
A preview of the PDF is not available
Family Business and Regional Development
Abstract and Figures
This book explores the relationship between families, firms, and regions and the extent to which these relationships contribute to regional economic and social development.
Figures - uploaded by Rodrigo Basco
Author content
All figure content in this area was uploaded by Rodrigo Basco
Content may be subject to copyright.
... These efforts encompass a continuum that ranges from macro-economic impacts on GDP, regional productivity, employment, exports, or R&D investments, mesoeconomic encounters and embeddings considering innovation systems, innovative or creative milieus, clusters, and entrepreneurial ecosystems towards mirco-economic activities, practices and images that can be directly attributed to managers through creating, transforming, and allocating spaces. In total, this special issue addresses the peculiarities of family firms, hidden champions and their recursive relationships with spaces (e.g., locations, places, landscapes) and scales (e.g., local, regional, national, global) as played out in regional development (see also Basco et al. 2021a;Stough et al. 2015). ...
... The nexus between family firms and regional development was mostly a by-product in past research (e.g., 'Third Italy industrial district literature ' Pyke et al. 1990) and is still at an infant stage, with scattered publications and few systemic accounts in economic geography, despite a recent take off in adjacent disciplines (e.g., family business, innovation and management studies) (e.g., Amato and Patuelli 2023;Basco 2015;Basco and Suwala 2020;Basco et al. 2021a;Bau et al. 2021). The nexus between hidden champions and regional development (e.g., Lehmann and Schenkenhofer 2023;Simon 1992Simon , 2012Simon , 2022Witt and Carr 2013) was almost absent in economic geography, and just recently regained attention beyond management studies (e.g., Lang et al. 2019;Liefner et al. 2024;Vonnahme and Lang 2021). ...
This editorial introduces the nexus between family firms, hidden champions, and regional development from an economic geography perspective. Family firms constitute the backbones of most local and regional economies, and some of them are even so-called hidden champions, which are global leaders in their market niches. At the same time, both entities are spatial sources of heterogeneity able to empower regions with difficult-to-imitate competitive and locational advantages that originate from the stickiness of their economic actors. It is mainly an empirical task to prove if this regional distinctiveness results from the structures and embeddings that family firms and hidden champions stand for (e.g., regional persistence and local rooting), and from the practices how these entities are owned, governed, managed (e.g., long-term business relations with [local] suppliers, customers, labour force, international excellence). By outlining three infant research directions on family firms and hidden champions from an economic geography perspective, this editorial frames the field, introduces and locates the contributions in this special issue therein, and calls for a spatially informed view on this rising cross-disciplinary field.
... Considering that many of the business support artefacts provided by business incubators lack gender neutrality and, at best, perpetuate a male-gendered entrepreneurship culture, incubators are ill-suited to address major challenges facing family businesses, such as female succession issues (Brophy et al. 2023), family conflicts and disputes impacting generational continuity and leveraging business identity with the local community (Barrios and González-Morales 2021), particularly in family businesses. Basco et al. (2021) observed that family businesses are economic and social actors with historical roots in certain places. This suggests that family businesses require culturally and socially sensitive tailored business incubation conforming to the value-driven nature of family business practices. ...
The influence of business incubation systems on family businesses in African economies has not been thoroughly investigated despite the potential contribution of family businesses to Africa’s economic expansion and the attainment of development goals outlined in the Africa Development Agenda 2063 and the Sustainable Development Goals. Therefore, this study investigates the potential benefits that family businesses in Africa can derive from engaging in business incubation. This study utilised an integrative literature review methodology to investigate the research question. Twenty-three peer-reviewed articles were systematically selected from the Scopus, Web of Science, and Google Scholar databases using the following combination of phrases: “family business” and either “business incubation” or “business incubator”. The findings suggest ways to create a mutually beneficial relationship between family businesses and business incubators to improve long-term sustainability, promote collaboration, facilitate knowledge transfer, and foster an entrepreneurial ecosystem. It also recognises challenges, such as cultural alignment in family businesses. Business incubators in Africa can improve the sustainability of family businesses, such as during the succession, by offering support, resources, and guidance. The South African experience is a role model for the rest of the continent, in this regard. Future research should broaden the sources beyond the three databases utilised, including non-peer-reviewed sources such as grey literature, and extend the focus beyond developing economies.
... Family businesses, as highlighted by Moussa and Elgiziry (2019) and Abouzaid (2014), constitute a significant portion, accounting for up to 80% of all businesses, employing 70% of the workforce, and contributing to 80% of the region's gross domestic product (GDP) (outside oil sector). This substantial presence positions family businesses to potentially serve as a driving force for regional development, as recognized by Basco et al. (2021), particularly within an environment that is gaining geopolitical and economic attention, as stated by World Economic Forum (WEF, 2018). ...
This paper aims to contribute to the literature on the capital structure and financing behavior of large listed family businesses by examining the differences and/or similarities in the determinants influencing the financing policy in the Arab world. The study focuses on two samples of equal size, consisting of 103 large listed family firms and 103 large listed non-family firms, covering the period from 2013 to 2019. Through a quantitative analysis of panel data, the research investigates the level of indebtedness and its determinants in these two categories of firms. The findings of this study reveal significant differences in the financing patterns between large listed family and non-family firms. These findings contribute to our understanding of the unique characteristics and preferences of large listed family firms in the Arab world, a region that has received limited attention in previous studies (Basly, 2017). By exploring this developing and relatively unexplored region, the study fills a gap in the literature and expands our knowledge of the capital structure dynamics within large listed family businesses
Since the beginning of the research on the family business and rural economy, there has been a problem with the delimitation of the concepts. Given this problem, this study’s main objective was to identify and visualize the intellectual structure of these two issues through scientific maps. To meet this objective, an evaluation of scientific performance and production was carried out with bibliometric indicators to extract the main research topics around these two areas through an analysis of the co-occurrence of keywords with scientific maps. The results show that research on family businesses and rural economy is booming, especially on family businesses that have higher productivity and performance. Regarding the main topics studied regarding family businesses and the rural economy, a total of 16 main themes were detected, highlighting the topic of entrepreneurship. The study of land management in transboundary environments is a potential line of future research.
In this research, the active role of the awareness regarding beliefs and values that are effective when family businesses -which carry great importance in the Turkish and glocal economy- are adopting a sustainable business approach, and the concept of socioemotional wealth (SEW), which is perceived as the non-economical values attained by the family due to its controlling position in the business, was examined. At the same time, the research has focused on heterogeneity in family businesses, dwelling on the concepts of competitive advantage and sustainable life, which are especially effective in shaping the situation of family businesses are an important source of entrepreneurship. Based on the results of literature research regarding the subject, in this research, the conceptual characteristics, innovation capabilities, competitive advantages and sustainable lives of family businesses operating in İstanbul in varying sizes from small enterprises to medium-sized enterprises and even large global enterprises were examined; 193 questionnaires were evaluated in line with the data received from İstanbul Chamber Of Industry as the target audience. The obtained data were analyzed using SPSS. As a result of the analysis, it has been seen that while SEW has a positive and meaningful effect on competitive advantage and sustainable business life, innovation capability has a partial mediation role. In this framework, it has been argued that SEW is a helpful construct for understanding the behavior of the family business; and as the family-related goals as reflected by SEW become more important for the business, family businesses have been shown to gain a competitive advantage with sustainable business longevity.
تُركّز هذه الدراسة على تحليل دور الشركات العائلية في التنمية المستدامة في الدول العربية بالتركيز على دعم النمو الاقتصادي والتوظيف والايرادات والمحافظة على البيئة. وتتمثّل أهم الخصائص الجوهرية للشركات العائلية العربية في الجماعية، والأبوية، ووجود الفجوات المؤسسية، وسيطرة الأفراد من داخل الشركة على مجلس الإدارة. عموماً تساهم الشركات العائلية بنسبة حوالي 60%من الناتج المحلي الإجمالي في المنطقة. وفي منطقة الخليج العربي، تساهم بحوالي 80%من الناتج المحلي الإجمالي خارج قطاع النفط. بيْد أن تغيّر البيئات السياسية والاقتصادية في الوقت الراهن في الدول العربية أثر تأثيراً ملموساً على أداء وتوقعات نمو هذه الشركات. وتتمثل أهم التحديات التي واجه الشركات العائلية في المنطقة في السياسات الحكومية والتشريعات واللوائح ونقص المهارات وظروف السوق المتغيّرة. بالإضافة إلى تحديات التحول الرقمي والبيئة الخارجية المحيطة . وتعتبر حوكمة الشركات العائلية من أكبر التحديات التي تؤثر على دورها في تعزيز النمو الاقتصادي والتوظيف في الدول العربية. وكانت أهم الدروس المستفادة من تجربة جائحة كوفيد 19 بالنسبة للشركات العائلية في المنطقة العربية هي اعطاء الأولوية لتبني التكنولوجيا، والتركيز على زيادة المرونة وبناء المنعة والتخطيط الاستراتيجي للشركة والاهتمام بدراسة ومعرفة خطط وسياسات الحكومة. وقد كانت الشركات العائلية التي تمتلك محافظ متنوعة ولديها استعداد جيد في جوانب الحوكمة وإدارة التدفق النقدي أكثر مرونة في تلافي تداعيات الجائحة.
This study focuses on analyzing the role of family businesses in sustainable development in Arab countries, with a particular focus on supporting economic growth, employment, revenues, and preserving the environment. The most important fundamental characteristics of Arab family businesses are collectivism, paternalism, the presence of institutional gaps, and the control of individuals from within the company over the board of directors. In general, family businesses contribute about 60% of the region's GDP. In the Arabian Gulf region, they contribute about 80% of the gross domestic product outside the oil sector. However, the current changing political and economic environments in Arab countries have had a significant impact on the performance and growth prospects of these companies. The most important challenges facing family businesses in the region are government policies, legislation and regulations, lack of human skills, and changing market conditions. In addition to the challenges of digital transformation and the surrounding external environment.
The governance of family businesses is considered one of the biggest challenges affecting their role in promoting economic growth and employment in Arab countries. The most important lessons learned from the Covid-19 pandemic experience for family businesses in the Arab region were giving priority to adopting technology, focusing on increasing flexibility, building resilience, strategic planning for the company, and paying attention to studying and knowing the government's plans and policies.
Family companies that own diversified portfolios and are well prepared in aspects of governance and cash flow management have been more flexible in avoiding the repercussions of the pandemic.
Family firms are widely acknowledged to be the most predominant form of organization and hold a great relevance in most economies. Nevertheless, despite their popularity, research has thus far yielded inconsistent findings with regard to their innovative performance. This paper aims to address this research gap by focussing on a specific form of innovation: radical innovation. It seeks to determine the propensity of family firms to generate such innovations. Furthermore, by considering the heterogeneity between regions and firms, this paper also investigates the potential moderating effects of being located in a regional cluster and firm size. Based on various data sources, it is empirically shown that family firms are on average less capable of producing radical innovation than non-family firms. However, the corresponding regional context matters in this regard. By being located within regional clusters, family firms can reap the benefits of localization externalities, leading to produce more radical innovations than being located outside regional clusters.
This study aims to investigate the occurrence of conflicts in family businesses, particularly focusing on their impact on founder behavior and organizational culture. Conducted in Bosnia and Herzegovina, the research employs a qualitative methodology to gain an in-depth understanding of conflicts within family businesses. The study utilizes semi-structured interviews as the primary data collection tool, engaging with 5 founders and 12 successors across various family owned businesses. The sample, comprising 17 participants, offers diverse perspectives on conflict dynamics between founders and successors. The interviews, designed to explore recurring key themes, delve into the nature and characteristics of task and process-based disagreements within these family enterprises. Key findings from this study include the observation that task or process-based disagreements, commonly arising between family members, can act as catalysts for founders to re-evaluate their behavior, potentially influencing the shaping of the organizational culture. The research highlights the importance of fostering a culture of open communication, critical thinking, and respect within family firms. Such a culture can play a significant role in reducing relationship conflicts and aid in reaching constructive resolutions. Additionally, the study reveals that the features of organizational culture within family businesses can be instrumental in managing conflicts effectively. This research underscores the complexity of family relationships in business settings and emphasizes the necessity of examining these dynamics from multiple angles. Given the prevalence of family members in key positions within family firms, the study sheds light on the importance of addressing diversity and conflict among family members, considering their long-term implications on the culture and future of these firms.
The grand environmental challenge of climate change represents one of the key ongoing, long-term obstacles for organizations. When interrupted by short-term exogenous crises like the COVID-19 pandemic and the shock of the Ukrainian war, the urgency of addressing this grand challenge becomes more pressing, albeit more challenging. While family firms as long-term oriented organizations might generally be well equipped to tackle climate change, we know surprisingly little on how they simultaneously experience and navigate the long-term horizon of grand environmental
challenges and the short-term pressures of exogenous crises. Drawing on research around long-term orientation (LTO) and a growing stream investigating intertemporal tensions, we investigate this question building on 41 interviews with nine family firms in the context of the European manufacturing industry. Applying an abductive approach, our findings unveil three intertemporal tensions that unfold when short-term and long-term objectives collide. Besides, we show that family firms, due to their LTO, perceive these tensions with a greater intensity. Navigating the perceived tensions, we identify two mechanisms employed by family firms that mitigate the negative implications of LTO. Doing so, we contribute to extant research on grand challenges and cast light on the downsides of LTO in family firms.
The empirical evidence of family business phenomenon in terms of employment outcomes is contradictory highlighting the micro–macro gap in the existing research. To address this contradiction, our study disentangles the role of context in family firms’ employment outcomes. To do so, we conduct a systematic literature review of 67 articles focusing on three employment-related outcomes—namely, growth, downsizing, and quality of labour—published in peer-reviewed journals from 1980 to 2020. Based on a two-by-two framework to classify this extant research, we unpack what we know about family firms and employment outcomes and where we can go from here. We highlight three main findings. First, current research is context-less since has mainly focused on the firm level in one context (i.e., region or country) and there is a lack of studies comparing family firms’ employment outcomes in different contexts and explicitly measuring the effects of contextual dimensions on family firms’ employment outcomes. This context-less approach could explain the conflicting results and lack of theoretical predictability about the family effect on employment across contexts. Second, the lack of understanding of the context in which family firms dwell highlights the need for future research to focus on context by theorizing about employment outcomes—that is, measuring context and its interactions with family- and job-related variables. Third, there is a need to further explore, analyse, and theorize on the aggregate effect of family firms on employment outcomes at different level of analysis (e.g., local, regional, and national).
This chapter searches for common fertile ground between the disciplines of family business studies and regional studies. Most existing studies linking both disciplines are fragmented and dispersed, thereby obstructing a systematic assessment of the cross fertilisation of knowledge. Based on their relationships to different spatial entities—a superordinate term for spatial factors, spatial structures, spatial processes, spatial contexts, spatial scales, spatial settings, spatial policies, and spatial concepts—we take stock of recent studies and attempt to shed new light upon the nexus of both disciplines. We present two more advanced theoretical models (i.e., the spatial family management model and the regional familiness model) that already incorporate the notion of spatial entities. We use these conceptual models to reflect on future lines of research and call for more interdisciplinary work to address research gaps and exchange insights around the ideas of ‘spatial familiness’ and ‘family spatialities’ on theoretical, empirical, and practical grounds.
Family firms have multiple nodes that connect them with the regions in which they are located, for example providing jobs and professional training, paying taxes, and engaging in regional philanthropy. The regional anchoring of family firms thus plays an important role in regional economies and, especially, in rural ones. In this sense, family firms’ transgenerational continuity is essential to keeping the regional link stable over time. However, family firm succession threatens not only firm survival but also regional stability. In this sense, the topic of family firm succession has received less academic and policy attention in terms of their regional ties across generations. To begin addressing this issue, I wonder whether successors have the same regional bonds as their predecessors. To investigate how succession affects the regional anchoring of family firms, this chapter analyses the characteristics of successors, their network connections, and their beliefs on how to do business. Based on a qualitative approach and through the lens of an institutional perspective, I explore case studies of successors in Basque family firms and analyse differences in the attitudes and behaviours between predecessors and successors. These differences indicate that successors have weaker regional embedding than their predecessors – i.e., the existence of regional dis-embedding process. This chapter discusses the potential consequences of family firm dis-embedding for regions and their economic development.
This paper analyses the influence of different types of spatial externalities related to the location of firms on their innovation performance and how those externalities combine in the territories with regard to the Marshall-Jacobs dichotomy. The originality of this study also lies in the consideration of a larger definition of the firm, one that takes into account the location of all its units. Based on a dataset of French industrial firms and specific indicators to evaluate the specialization and/or diversification of the employment zones, the impacts of the spatial profile of the firm on its innovation performance are tested.
In this editorial, we focus on family business in the Arab world to exemplify the benefits of better contextualizing family business research to further our understanding of
heterogeneities among family businesses from diverse regions. To produce more useful knowledge, we propose that family business research has to shift from classical contextualizing to context theorizing by encouraging the use of a context-sensitive approach. To achieve this goal, the present article introduces the embeddedness framework of family business contexts to be used as a context-sensitive instrument to recognize how context shapes family firm behavior and performance. By using a context-sensitive approach, we present three articles that focus on family firms in the specific context of the Arab world. We conclude this editorial by proposing a research agenda for context-sensitive approaches to family business research and specifically discuss the facets of context in Arab family businesses.
The management of urban and rural areas has always consisted of a mixture of state, market and civil society actors. In times of increased liberalization, deregulation and privatization of many former state-dominated tasks, limited institutional capabilities of smaller communities, a lack of consolidated government bodies and low effectiveness of authorities, there exists a greater interest for non-state ‘place-based’ economic engagement in general, and for private-sector involvement and leadership in regional governance in particular. This chapter introduces approaches to enterprise-driven urban and regional engagement. Empirically, the chapter summarizes existing case studies from the literature on enterprise-driven urban and regional engagement and asks if and how place leadership initiatives interact with corporate social responsibilities. In conclusion, the chapter suggests it is desirable to explicitly include the private sector in place leadership roundtables in order to create tri-sectoral negotiations.
Purpose
This article attempts to answer the following questions: Who ultimately owns firms listed in the Gulf Cooperation Council (GCC) countries? Does ownership structure depend on the institutional context? How does ownership affect firm performance? Do institutional factors influence the ownership–performance relationship?
Design/methodology/approach
We apply univariate analyses and generalised methods of moments estimations for a sample of 692 GCC listed firms during 2009–2015.
Findings
Our results reveal that corporations are mainly controlled by the state or families, the ownership structure is highly concentrated and pyramid structures are common in the region. Ownership is more concentrated in non-financial than financial firms, and ownership concentration and shareholder identity differ by institutional country setting. Finally, ownership concentration does not influence performance, but formal institutions play a moderating role in the relationship.
Practical implications
As our findings reveal potential type II agency problems due to ownership concentration, policymakers should raise awareness of professional corporate governance practices and tailor them to GCC countries’ institutional contexts.
Social implications
Even with the introduction of new regulations by some GCC states to protect minority investors and promote corporate governance practices, ownership concentration is a rigid structure, and its use by investors to protect their economic endowment and power is culturally embedded.
Originality/value
Although previous studies have analysed ownership concentration and large shareholders’ identities across countries, this study fills a research gap investigating this phenomenon in-depth in emerging economies.
There is both a practical and a scholarly need for the thorough examination of the nexus between family firms and economic spaces (e.g. locations, places, landscapes). The authors address this nexus through two approaches. First, they explore economic spaces’ effect on family firms by considering the influence different types of economic spaces have on firm behavior and firm performance. Second, they explore family firms’ effect on economic spaces by attempting to clarify the role family firms play in different economic spaces. The explores the peculiarities of family firms and their recursive relationships with economic spaces. The authors propose a journey that includes three avenues—macro-, meso-, and micro-foundations—to organize current debates on and to further our understanding of spatial familiness.