Not All Family Firms Are Alike: How Founder-Led and Governance-Entrenched Family Control Shape the Trading Environment Around the Firm
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摘要
The study disentangles founder-led from governance-entrenched family control and links them to regulator-observable trading patterns around firms’ stocks. Analyzing 8,634 U.S. firm-years (2007–2018) using NASDAQ SMARTS continuous-trading-manipulation (CTM) flags, we find Founder-CEO Control associated with approximately 9.5% fewer CTM flags, Family Governance Involvement with about 21.3% more, and Deep Multi-Generational Family Control with about 47.1% more. These results persist across specifications and controls, indicating heterogeneous governance mechanisms with opposite implications for market integrity. External monitoring via institutional ownership attenuates the entrenchment channel, while descendant management does not drive the positive governance-entrenchment results, suggesting governance structure–dependent effects on the trading environment surrounding the firm [page::16][page::17][page::19][page::20][page::22][page::29].
