Family Firms Amidst the Global Financial Crisis: A Territorial Embeddedness Perspective on Downsizing

Abstract This study explores the downsizing propensity of family and non-family firms by considering their territorial embeddedness during both periods economic stability financial crisis. By drawing on a panel dataset Spanish manufacturing for period 2002–2015, we show that, all things being equal, have lower to than firms. When effect embeddedness, found that territorially embedded an even counterparts. Furthermore, concern employees’ welfare was particularly pronounced years global result is explained existence socially proximate relationships with firms’ immediate surroundings, based similarity sense belonging, which push deeply rooted treat employees as salient stakeholders hard times. Overall, our stresses importance local roots in moderating relationship between downsizing.