The influence of family ownership dispersion on debt level in privately held firms

The aim of this article is to investigate the financing behavior of privately held firms along the dispersion of family ownership. Drawing on the socio-emotional wealth perspective, we argue that debt levels are contingent on the degree of owner- ship dispersion among family members. Based on a sample of 2451 observations, in a 10-year time frame, our results reveal the existence of an inverted U-shaped relationship between debt level and intra- family ownership dispersion. We demonstrate that this relationship is moderated by the generational involvement that inverts it in later generations.