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Entrepreneurial Orientation, Risk Taking, and Performance in Family Firms

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This article focuses on risk taking as one important dimension of entrepreneurial orientation and its impact in family firms. Drawing on a sample of Swedish SMEs, we find that risk taking is a distinct dimension of entrepreneurial orientation in family firms and that it is positively associated with proactiveness and innovation. We also find that even if family firms do take risks while engaged in entrepreneurial activities, they take risk to a lesser extent than nonfamily firms. Moreover, and most importantly for our understanding of entrepreneurial orientation in family firms, we find that risk taking in family firms is negatively related to performance. Both theoretical and practical implications of our findings are provided.
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Document Type: Research Article

Publication date: March 1, 2007

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