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<p>This study examines how political connections affect innovation in Tunisian firms, focusing on the role of family ownership. We used data from the 2020 World Bank Enterprise Surveys and statistical models to analyze these relationships. Our findings show that as the proportion of family members in key management positions increases, the likelihood of innovation decreases for both politically connected and non-connected firms. However, this decline is less severe for firms with political connections. At higher levels of family involvement, the gap in innovation between connected and non-connected firms narrows, meaning that political ties reduce some of the negative effects of family control on innovation. These results suggest that while family ownership can hinder innovation, political connections may provide an advantage in overcoming these challenges. We offer policy suggestions to address the interplay between family firms, political ties, and innovation in Tunisia.</p>

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Political ties and family-controlled firms in Tunisia: the innovation dilemma

  • 期刊论文

  • 发表日期：

    2025年6月2日

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  • Mohieddine Rahmouni,
  • Mossab Saud Alholiby,
  • Mohamed Nasr Saeed,
  • Eid Awad Hassan

摘要

This study examines how political connections affect innovation in Tunisian firms, focusing on the role of family ownership. We used data from the 2020 World Bank Enterprise Surveys and statistical models to analyze these relationships. Our findings show that as the proportion of family members in key management positions increases, the likelihood of innovation decreases for both politically connected and non-connected firms. However, this decline is less severe for firms with political connections. At higher levels of family involvement, the gap in innovation between connected and non-connected firms narrows, meaning that political ties reduce some of the negative effects of family control on innovation. These results suggest that while family ownership can hinder innovation, political connections may provide an advantage in overcoming these challenges. We offer policy suggestions to address the interplay between family firms, political ties, and innovation in Tunisia.