This paper considers the impact of firm ownership on innovation over the industry life-cycle. By analyzing a sample of 9602 European manufacturing firms, we first confirm established evidence that firms focus on product-oriented innovation during the growth stage of the industry life-cycle, and on process-oriented innovation during maturity. When firm ownership is taken into account, we find that this pattern is strongly reversed by the shifts from growth to maturity, but only for family firms, as these firms are significantly more prone to introduce risky product innovations during maturity. Controls for firm size, financial resources and other firm-specific variables, together with an explicit consideration of managerial ability, help in rejecting the hypothesis that family firms rely on product innovation for the inferior ability to manage process and organizational innovation. In addition, we find that the adoption of risky product innovation during maturity is mainly associated with family ownership, not management. By contrast, family management favors risk-avoiding behavior, except in the case of experienced family CEOs.

Innovation over the industry life-cycle. Does ownership matter? / Cucculelli, Marco; Peruzzi, Valentina. - In: RESEARCH POLICY. - ISSN 0048-7333. - STAMPA. - 49:1(2020), pp. 1-20. [10.1016/j.respol.2019.103878]

Innovation over the industry life-cycle. Does ownership matter?

Cucculelli, Marco
;
Peruzzi, Valentina
2020-01-01

Abstract

This paper considers the impact of firm ownership on innovation over the industry life-cycle. By analyzing a sample of 9602 European manufacturing firms, we first confirm established evidence that firms focus on product-oriented innovation during the growth stage of the industry life-cycle, and on process-oriented innovation during maturity. When firm ownership is taken into account, we find that this pattern is strongly reversed by the shifts from growth to maturity, but only for family firms, as these firms are significantly more prone to introduce risky product innovations during maturity. Controls for firm size, financial resources and other firm-specific variables, together with an explicit consideration of managerial ability, help in rejecting the hypothesis that family firms rely on product innovation for the inferior ability to manage process and organizational innovation. In addition, we find that the adoption of risky product innovation during maturity is mainly associated with family ownership, not management. By contrast, family management favors risk-avoiding behavior, except in the case of experienced family CEOs.
2020
File in questo prodotto:
Non ci sono file associati a questo prodotto.

I documenti in IRIS sono protetti da copyright e tutti i diritti sono riservati, salvo diversa indicazione.

Utilizza questo identificativo per citare o creare un link a questo documento: https://hdl.handle.net/11566/270936
 Attenzione

Attenzione! I dati visualizzati non sono stati sottoposti a validazione da parte dell'ateneo

Citazioni
  • ???jsp.display-item.citation.pmc??? ND
  • Scopus 35
  • ???jsp.display-item.citation.isi??? 33
social impact