Bounded Rationality and Bounded Reliability: A Study of Nonfamily Managers' Entrepreneurial Behavior in Family Firms. (March 2019)

• Record Type: Journal Article
• Authors: Kotlar, Josip; Sieger, Philipp
• Other Names: Chrisman James J. guest-editor.; Chua Jess H. guest-editor.; Steier Lloyd P. guest-editor.; Zellweger Thomas M. guest-editor.
• Is Part Of: Entrepreneurship theory and practice. Volume 43:Number 2(2019)
• Page Start: 251
• Page End: 273
• Publication Date: 2019-03
• Subjects: bounded rationality -- bounded reliability -- transaction cost economics -- (non)family managers -- entrepreneurial behavior; Small business -- Periodicals; New business enterprises -- Periodicals; Entrepreneurship -- Periodicals; 658.421
• DOI: 10.1177/1042258718796085
• Languages: English
• ISSNs: 1042-2587

Abstract

We use transaction cost economics to explain the individual-level entrepreneurial behavior of family and nonfamily managers in family firms. We argue that nonfamily managers exhibit lower entrepreneurial behavior than family managers, particularly after the founder's departure from the business. Moreover, we identify an expanded set of factors through which family firms can facilitate nonfamily managers' entrepreneurial behavior, including monitoring, incentives, distributive justice, access to the top management, and job control perceptions. We test these hypotheses in a sample of 296 family firm managers, contributing new insights on nonfamily managers and corporate entrepreneurship in family firms.