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Academic Journal
Finance

“Are Family Firms More Efficient? Revisiting the U-Shaped Curve of Firm Scale and Efficiency”

This study applies a stochastic frontier model to examine the relationship between firm size and efficiency using a novel approach. The first novelty is that this study examines large and small firms separately to allow for heterogeneity between firm group sizes in terms of measuring the size-efficiency relationship. The second is that we use a modified frontier model which explicitly includes a family firm variable when measuring firm efficiency. Empirical results reveal that firms are in fact heterogeneous, with small-and-medium-sized enterprises (SMEs) exhibiting a U-shaped scale efficiency curve, while large enterprises (LE) exhibit an efficiency curve which is positive and linear. Robust results also confirm that family firms are relatively more efficient than non-family firms. In addition, while controlling for family firms does not appear to change the firm’s size-efficiency dynamics, failure to control for family firms leads to a bias in characterizing the nature of the firm’s production returns to scale.
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Academic Journal
Management

“Are managers from Mars and academicians from Venus? Toward an understanding of the relationship between academic quality and practical relevance”

In this paper, we propose a positive relationship between the academic quality and practical relevance of management research. The basis for this is the idea that academicians and practitioners both value research that is interesting and justified - meaning research that challenges and extends existing beliefs and research that offers compelling evidence for its conclusions. We acknowledge that there are likely to be many cases where academicians and practitioners disagree on what is interesting and justified. We argue, however, that there are also likely to be cases where the judgments of the two groups converge. Results from a stratified, random sample of 120 publications are consistent with this argument - showing a positive correlation between an objective measure of an article's academic quality and expert panel ratings of its practical relevance. The analysis also shows positive associations between panel members' global assessment of relevance and ratings of an article's interestingness and justification. These results lend support to the hypothesized overlap, but leave room for considerable difference in the way practitioners and academicians evaluate management research. Copyright © 2004 John Wiley & Sons, Ltd.
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Academic Journal
Management
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