Family Firms, Firm Performance and Political Connections: Evidence from Bangladesh
Posted: 9 Aug 2015
Date Written: August 8, 2015
Abstract
We investigate the role of political connections in the performance of family firms. We do so in the setting of Bangladesh, an emerging economy in which family firms are dominant and a weak regulatory environment increases the payoffs from political connections. We find that family firms perform better than nonfamily firms. Moreover, politically connected family firms outperform family firms that are not politically connected. In contrast, nonfamily firms with political connections demonstrate lower firm performance than nonfamily firms without political connections.
Keywords: Political connections, Family firms, Firm performance, Emerging economy, Bangladesh
JEL Classification: G32
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