A Research On The Political Connections Of Family Firms And Transmission Performance

Since China carried out the reform and open policy,family enterprises promote the sustained and steady development of Chinese economy.As statistic shows that the succession of Chinese family business will step into peak period.Family business complete the inheritance of a business with a smooth transmission performance is a vital problem that needs to be solved immediately.Throughout the history of Chinese family business,government plays an important role in determining the vicissitude of family enterprises.So the writer considered that the political connections of family enterprises will have an influence on enterprise transmission performance.Given this,on the basis of presenting literature at home and abroad and analyzing the relevant theories at the same time,writer takes the Chinese family enterprises which have achieved intergenerational succession from 2004 to 2013 as the research object,then study the correlation between political connections of family enterprises and transmission performance.This paper considers entrepreneur's political connections as the family businesses'.Using the variation of corporate performance before and after the succession to measure the enterprise transmission performance,in order to identify the correlation between corporate political connections and the change of corporate performance in the succession phase accurately.Writer considers both outgoing and succession entrepreneurs' political connection,and enterprise political connections before and after the change,so we can give a systematic analysis of the correlation between political connections of family enterprises and transmission performance.Through the study,this paper draws the following conclusion.First,in the succession of Chinese family enterprises,the political resources are not easy to transfer.Second,when family businesses achieve intergenerational succession,the enterprise performance inevitably present significant downward trend.Third,family businesses can seek political connections to help to complete family enterprise transition smoothly.Especially in the following aspects: The founder of family businesses who has political connections will turn to make business performance decline in succession;The difference of two generations' political connections makes the political connections of family enterprises slow down,which in turns decline enterprise' performance;When both outgoing entrepreneurs and succession entrepreneurs have political connections,it can relieve the reverse influence of enterprise performance when the outgoing entrepreneurs quit the firm.