Productivity Performance in The Manufacture Sector of Cameroon : How Does Family and non-Family Firm Perform

Johannes Tabi Atemnkeng, Mbu Daniel Tambi

Abstract


This research provides insights on factors affecting performance of family firms in comparison with the non-family firms making use of data from Cameroon. We estimated total factor productivity via a Cobb–Douglas production function while accounting for the correlation between input levels and productivity. As concerns the management and control of firms, family members are heavily involved in family firms than those of non-family firms which are mostly managed externally. It is observed that non family firms employ more labour and invests more in capital compared to family owned and managed firms. Based on the two-staged least-squares technique, results show that family firms and even those managed by families are, on average less productive than externally managed family firms and non-family owned firms after controlling for sector as well as other characteristics.  The findings are important for both policy makers and practitioners.


Keywords


Productivity Performance, Manufacturing Sector, Family, Non-family, Firm, Cameroon

References


Anderson C and Reeb D (2003): “Founding-Family Ownership and Firm Performance: Evidence from the S&P 500”. Journal of Finance, 58, (June), 1301- 1328

Astrachan J and Shanker M (2005): “Family Businesses’ Contribution to the U.S. Economy: Closer Look”. Family Firm Institute.

Ayyagari M, Demirguc-Kunt, Maksimovic V (2011): “Small vs. Young Firms Across the World: Contribution to Employment, Job Creation, and Growth”. Policy Research Working Paper Series 5631, The World Bank

Barbera F and Moores K (2011): “Firm Ownership and Productivity: A Study of Family and Non-Family SMEs”. Small Business Economics, 1-24.

Barontini R and Caprio I (2006): “The effect of family control on firm value and performance: Evidence from continental Europe”. European Financial Management, 12, 689-723.

Barth E, Gulbrandsen T, and Schønea P (2005): “Family Ownership and Productivity: The Role of Owner-Management”. Journal of Corporate Finance, 11(1–2), 107–127.

Bosworth D and Loundes J (2002): “The Dynamic Performance of Australian Enterprises. Melbourne Institute of Applied Economic and Social Research,The University of Melbourne (Melbourne Institute Working Paper Series).

Collier P (2000): “Africa’s Comparative Advantage,” in Hossein Jalilian, Michael Tribe,and John Weiss, eds., Industrial Development and Policy in Africa, Cheltenham, UK:Edward Elgar pp. 865–934.

Crew M, Jones-Lee MW, Rowley CK (1971): “X-theory versus management discretion theory”. Southern Economic Journal, 38: 173-184.

Duh M, JBelak J, Tominc P and Rebernik M (2007): “Some aspects of Business ethics in family enterprises in Slovenia. Faculty of Economics and Business Maribor, Maribor, Slovenia, Research papers, Organizacija,Volume 40: September-October

Fernandes A M (2008): “Firm Productivity in Bangladesh Manufacturing Industry”. World Development 36(10), pp. 1725-1744.

Fomba E (2007): Managing Human Resources in the Familistic Family Business in Cameroon, (pp.56-72) in Gupta, V.; Levenburg, N.; Moore, L.; Motwani, J.; and Schwarz,T. (eds.). A Compendium on the Family Business Models around the World (ten volumes), Hyderabad: ICFAI University Press

Galve-Górriz and Salas-Fumás V. (1996): Ownership structure and firm performance: Some Empirical Evidence from Spain. Managerial and Decision Economics 17(6), 575-586.

Galve-Górriz C and Salas-Fumás V (2011): “Family ownership and firm performance: The net effect of productive efficiency and growth constraints”. Innovar, 21(40), 155-170.

Gatti R and Love I (2008): “Does access to credit improve productivity? Evidence from Bulgaria”. Economics of Transition Volume 16(3), 445–465

Heck R and Stafford K (2001): “The Vital Institution of Family Business: Economic Benefits Hidden in Plain Sight”. In G.K. McCann & N. Upton (Eds.), Destroying myths and Creating value in Family Business (pp. 9-17). Deland, FL: Stetson University Press.

Hill C and Snell SA (1989): “Effects of ownership and control on corporate productivity” Academy of Management Journal, 32, 25-46.

Jaskiewicz P and Klein S (2005): “Family Influence and Performance Theoretical Concepts and Empirical Results,” Paper Presented at the FERC Conference, Portland, Ore-gon.

Jovanovic B (1982): Selection and the Evolution of Industry. Econometrica 50(3), 649–670.

Kirchhoff B and Kirchhoff J (1987): “Family contributions to productivity and profitability in small businesses”, .Journal of Small Business Management, 25(4): 25–31.

Klein S (2000): “Family Businesses in Germany: Significance and Structure”. Family Business Review, 13, 157-181.

Lee J (2006): “Family firm performance: Further evidence”. Family Business Review vol. XIX, no. 2,

Levinsohn J and Petrin A (2003): “Estimating production functions using inputs to control for Unobservables”. Review of Economic Studies 70(2): 317–342.

Martikainen M, Nikkinen J and Vahamaa S (2009): Production Functions and Productivity of Family Firms: Evidence from the S&P 500. The Quarterly Review of Economics and Finance, 49(2), 295–307.

McConaughy L, Walker M, Henderson G and Mishra C (1998): “Founding family controlled firms: Efficiency and value”. Review of Financial Economics, 7, 1-19.

Miller D, Miller B, Lester R and Cannella Jr. A (2007): “Are Family Firms Really Superior Performers?” Journal of Corporate Finance 13 (5)

Olley G and Pakes A (1996): “The dynamics of productivity in the telecommunications equipment industry”. Econometrica 64: 1263–1297.

Palia D and Lichtenberg F (1997): “Managerial ownership andfirm performance: A re-examination using productivity measurement”. Journal of Corporate Finance, 5(4), 323–339.

Petrin A, Poi B and Levinsohn J (2004): “Production function estimation in Stata using inputs to control for unobservables”, Stata Journal, 4(2), pp. 113–123.

Prowse S (1992): “The Structure of Corporate Ownership in Japan”. Journal of Finance 47.

Rettab B and Azzam A (2011): “Performance of Family and Non-family Firms with Self- Selection: Evidence from Dubai”. Modern Economy, 2, 625-632

Schleifer A and Vishny RW (1997). “A survey of corporate governance”. Journal of Finance 52.

Shyu J and Shen Yu-Hung (2011): “How Does Family Management Affect Performance: Evidence from Taiwanese Firms”. Journal of Family Business Studies (EJFBS) Issues 1-2, Volume 5,

Smith A (1776): An Inquiry Into The Nature And Causes Of The Wealth Of Nations. University of Chicago Press, Chicgo.

Solow RM (1957): “Technical change and the aggregate production function”. Review of Economics and Statistics, 39: 214-231.

Stern N (2002). A Strategy for Development. World Bank, Washington, DC

Tabi J and Njong A (2012): “Fiscal Policy and Sectoral Productivity Convergence in a Developing Economy: Implications for Poverty Reduction”. Asian Social Science, Vol. 8, No. 4.

Tchankam J (2006): L’enterprise Familiale au Cameroon. Cahier 2000-05, CREF.

Wall A R (1998). “An Empirical Investigation of the Production Function of the Family Firm.” Journal of Small Business Management. 25, pp. 24-32.

Weiping L, Yang H and Zhang G (2010): “Does family business excel in firm performance? An institution-based view”. Asia Pacific Journal of Management


Full Text: PDF

Refbacks

  • There are currently no refbacks.


Indexed by :

http://journal.bakrie.ac.id/public/site/images/admin/neliti-blue_02_120 http://journal.bakrie.ac.id/public/site/images/admin/sinta_01_120 http://journal.bakrie.ac.id/public/site/images/admin/garuda1_120 http://journal.bakrie.ac.id/public/site/images/admin/googlescholar_logo_120