We would like to invite you to the Inaugural Online Research Seminar of the Baltic Economics Association. The seminar series is scheduled to take place once a month with the purpose of developing personal contacts and promoting joint scholarly research and intellectual exchange between economists of the Baltic States.
We are delighted that Alminas Žaldokas (Hong Kong University of Science and Technology), the founding member of the Baltic Economic Association, has kindly agreed to serve as the speaker of the inaugural seminar. Ever since cofounding the Lithuanian Economics Network in 2012, Alminas had a vision of expanding the network to the Baltic region, which eventually took place in 2018. Alminas’ paper, co-authored with a fellow from Latvia, Jānis Bērziņš (BI Norwegian Business School), represents the very idea of the Baltic cooperation.
Speaker: Alminas Žaldokas (Hong Kong University of Science and Technology)
Title: Conflicts in Private Family Firms
Co-author: Jānis Bērziņš (BI Norwegian Business School)
Date: 22 May 2020
Time: 10:30 AM Vilnius, Riga, Tallinn
Facilitator: Linas Tarasonis (Vilnius University)
Abstract: We use Norwegian household-level data and full structures of family relationships to understand how succession decisions are made when the family has multiple potential heirs. We argue that the decision on ownership distribution in family firms is related to the potential of future family conflicts, and that such within-family dynamics have implications for firm investment and growth. We identify the causal effect by looking at whether the founder has experienced a divorce or a separation in the distant past. We instrument founder's divorce with the frequency of divorces in the extended family relationships outside of the nuclear family, which we argue makes founder's divorce more socially acceptable. Since some family conflicts are inevitable and family heirs might not be able to trade their shares, founders should consider adjusting their inheritance to minimize the possibility of heir feuds and adverse effects on firm growth.
More about the speaker: http://www.alminas.com/