Do The Growth Experiences Of Second Generation Influence The Growth Paths Of Family Firm?

The founders of family enterprises started their business began in 1980s,and now most of them are over fifty years old.The domestic family enterprises are facing the peak period of a power shift.Family enterprise inheritance is the key of the long-term development.However,the low willing to inheriting family enterprise always appears in inheritance.In order to research this problem,we collected the information of the second generation's growth experience and the first generation's starting business experience.We researched how the low willing to inheriting family enterprise influence the growth path of family enterprise in terms of the growth experience of second generation.This paper studies the growth experience of the second generation,which is mainly whether the second generation experienced the starting business experience of the first generation when they were 5-15 years old.At the same time,they also joined the overseas study experience and the work experience before entering the family business.In addition,this paper divides family businesses' growth path into intensional and epitaxial development.Specifically,intensional development is increased through innovation investment,while epitaxial development is external mergers and acquisitions.Through empirical research,we find that if the second generation experienced their parents' hard starting business in their childhood,they would reduce investment in innovation and more cross industry mergers and acquisitions.Besides,the second generation of family members who have overseas study experience and family work experience will not only attach more importance to innovation input,but also find opportunities for cross industry mergers and acquisitions.Further studies show that:the second generation who experienced first generation starting business is negatively correlated with the number of patents applications.And the degree of prosperity of the industry will have a significant impact on the cross industry mergers and acquisitions.At the same time,we research the effect of cross industry mergers and acquisitions on enterprise performance and risk management through empirical test.We found that the cross industry mergers and acquisitions neither significantly affects the long-term performance of enterprises nor significantly affect the management risk of the enterprise.Therefore,we believed that the cross industry mergers and acquisitions enterprises is more driving from the mentality and behavior of second generation.We demonstrates the special significance of the second generation's growth experience in the inheritance of family businesses from a new perspective.And it provides a new logic and evidence for the innovation investment and cross industry M&A behavior in the inheritance of family businesses in China.