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Journal of International Entrepreneurship

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30-03-2021

Family involvement as influencer on family firm’s growth

Authors: Myriam Cano-Rubio, Guadalupe Fuentes-Lombardo, Valeriano Sanchez-Famoso

Published in: Journal of International Entrepreneurship | Issue 4/2021

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Abstract

This paper analyzes the relationship between family involvement and a firm’s growth. Family businesses present unique features, which make them different from other companies. Therefore, their desire to achieve long-term growth and/or survival could be motivated by different reasons from those of non-family firms. One of the possible strategic alternatives to guarantee these long-term objectives is the internationalization strategy. The empirical study carried out is quantitative research based on the partial least squares (PLS) methodology. The study population comprises Spanish wine and olive oil production companies. Our results show how economic reasons account for the relationship between family involvement in the business and achievement of their growth. Likewise, we find that, depending on their international propensity as moderating variable, the mediation effect of the underlying business economic motivations is total for non-international firms, whereas that effect is a partial one if the firms have become international.

previous article Disentangling the drivers of family firms internationalization through the lens of socioemotional wealth

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“Totally Mediation = Full Mediation: a situation in mediation analysis that occurs when the mediated effect is significant but not the direct effect. Hence, the mediator variable totally explains the relationship between an exogenous and an endogenous latent variable.” (Hair et al. 2017, p. 317).

“Partial mediation: occurs when a mediator variable partially explains the relationship between an exogenous and an endogenous construct.” (Hair et al. 2017, p. 324).

Several indicators loaded between 0.40 and 0.70, indicating that they might otherwise be considered for removal based on the CR and AVE. However, because the CR and AVE exceeded the threshold, we concluded that the removal of indicators from the model with loadings 0.40–0.70 was unnecessary.

We thank one of or our anonymous reviewers for this insightful suggestion.

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Title: Family involvement as influencer on family firm’s growth
Authors: Myriam Cano-Rubio
Guadalupe Fuentes-Lombardo
Valeriano Sanchez-Famoso
Publication date: 30-03-2021
Publisher: Springer US
Published in: Journal of International Entrepreneurship / Issue 4/2021
Print ISSN: 1570-7385
Electronic ISSN: 1573-7349
DOI: https://doi.org/10.1007/s10843-021-00290-y

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