Family Involvement in Management and Firm Performance. Evidence from Italy

Using Total Factor Productivity (TFP) as a measure of corporate performance, this study compares the performance of owner management to that of firms run by professional managers over the period 2004-2006. We consider the influence of owner management for the sample as a whole and for subgroups of firms. The findings demonstrate that family run firms are less productive than firms run by professional managers, but the difference between the two is small. Our results support the idea that in Italy there is not a genuine process of manager selection both for family and no-family firms.