Resource Mobilization and Performance in Family and Nonfamily Businesses in the United Kingdom

Abstract

This study draws on agency theory and the resource-based view to hypothesize that family and nonfamily businesses differ in the capital that they deploy and the way that they deploy it. It, and test this hypothesis in a large U.K.-based sample of 319 family business and 258 nonfamily business owner/managers. The analysis revealed that adverse selection, opportunism, and niche marginalization are more prevalent among family business owner/managers. Yet, their businesses are similar to those of their nonfamily business peers in performance outcomes such as size and growth, which suggests that weaknesses in human and financial capital choice are offset by strengths in the social capital of family firms.