Anmerkungen:
Nach Informationen von SSRN wurde die ursprüngliche Fassung des Dokuments January 2, 2013 erstellt
Beschreibung:
This paper is a theoretical review in an attempt to answer the query regarding trans-generational succession among small, medium sized, and large enterprise (SME). The theoretical review begins with Rational Expectation Theory to explain the risk of failed succession; the decision process under such a theory is comprised of the information set that generates the feedback moment by business owners. The succession is treated as an objective to which utility is attached. Utility is treated under the utility theories commencing with Bernoulli's original utility function, and as modified by Laplace-Tothunter correction thereto. Finally, the rationale under the Prospect Theory proposed by Kanhman and Tversky is used to summarize the utility aspect of trans-generational succession. The methodology employed is Bayesian probability approach to define risk and risk behavior. The Modern Portfolio Theory is proposed as a possible answer to make the family business more attractive to successor candidates. In the alternative, successful transfer may be insured through franchising. In so doing, project selection model with emphasis on tax and depreciation are used as analytical tools. Hypothesis testing follows the conventional decision rule with emphasis on effect size. This accounting approach helps to bring about a balanced evaluation of the franchise prospect. It is concluded that SME succession problem may be solved by a product portfolio or business franchise. This paper draws relevant knowledge from economics, finance and accounting