Comparative performance of foreign and domestic family firms in Czech Republic

A number of previous studies have been focused on performance diff erences between multinationals and domestic fi rms, the same is not true for family business research.Th e goal of this paper is to investigate the performance diff erences between domestic and foreign family fi rms operating in Czech Republic.We hypothesize that foreign family fi rms outperform their Czech counterparts in terms of return on assets and labor productivity.Using the Student's t-test for mean diff erences, regression analysis and matched-pair testing on the sample of 573 domestic and 154 foreign family fi rms, we found that foreign family fi rms outperform domestic family fi rms in profi tability and labor productivity.One of the major factors explaining these performance gaps is the size and capital intensity of foreign family fi rms.We argue that the aspect of "foreignness" has been neglected in past family business studies dealing with performance of family fi rms, and that it actually makes a diff erence.Researchers should concern whether family fi rms in their research samples are wholly or partially foreignly owned or controlled.