The life cycle of family ownership: international evidence

We show that in countries with strong investor protection, developed financial markets and active markets for corporate control, family firms evolve into widely held companies as they age. In countries with weak investor protection, less developed financial markets and inactive markets for corporate control, family control is very persistent over time. While family control in high investor protection countries is concentrated in industries with low investment opportunities and low M&A activity, this is not so in countries with low investor protection, where the presence of family control in an industry is unrelated to investment opportunities and M&A activity.