Article: article from journal or magazin.
Idiosyncratic risk, private benefits, and the value of family firms
Finance Research Letters
Many listed companies around the world are controlled by under-diversified family blockholders, who bear idiosyncratic risk in addition to systematic risk. In this paper, we assume that these shareholders require private benefits to compensate for the additional risk. We propose a simple equilibrium model of private benefits that highlights how the idiosyncratic risk borne by a family blockholder impacts the amount of required private benefits and ultimately, the market value of the family firm.
Family firm, Blockholders, Idiosyncratic risk, Private benefits, Market value
Web of science
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