Psychological ownership as a driving factor of innovation in older family firms

Rau, Sabine; Werner, Arndt; Schell, Sabrina (2019). Psychological ownership as a driving factor of innovation in older family firms. Journal of family business strategy, 10(4), p. 100246. Elsevier 10.1016/j.jfbs.2018.03.001

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Innovation is often key to long-term success. While some family firms innovate less when growing older, others are very successful and innovative over multiple generations. We provide a new explanation for this phenomenon by showing that psychological ownership can influence the relationship between generation in ownership and innovation output. In line with the literature, we find that over the generations, innovation output decreases, being significantly lower in the third and later generation than in the founder generation. However, if the third and later generation owner-managers have high levels of psychological ownership, innovation output is as high as in the founder and second generation. Our hypotheses are supported by data obtained from 942 German firms. Innovation in the third generation and beyond seems more feasible when not only legal ownership, but also psychological ownership, is passed down to the succeeding generation.

Item Type:

Journal Article (Original Article)


03 Faculty of Business, Economics and Social Sciences > Department of Business Management > Institute of Organization and Human Resource Management > Human Resource Management

UniBE Contributor:

Schell, Sabrina


300 Social sciences, sociology & anthropology > 330 Economics








Sabrina Schell

Date Deposited:

17 Aug 2018 16:56

Last Modified:

05 Dec 2022 15:17

Publisher DOI:


Uncontrolled Keywords:

Innovation Family business Psychological ownership Generation




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