The liability of kinship and the internationalization of family firms: A qualitative study of a Greek family firm

We examine how the informal institution of “fictive kinship” impacts the international scope of family firms. Building on internalization theory, institutional theory, and social anthropological literature, we offer a new perspective on family firms' internationalization, exploring their contextual heterogeneity. We unpack family structures, which are idiosyncratic but with tangible consequences for internationalization decisions. We propose that internalization across borders will be constrained by the liability of kinship, which is especially pronounced in markets where fictive kinship informal institutional structures are dominant. Where fictive kinship is more prevalent, family firms remain longer in their early governance structures. This is due to the greater availability of family resources and increasing concentration on the family's socioeconomic wealth, leading to reduced interest in internationalization. We examine these arguments using a qualitative study of a Greek medium-sized family firm in the hospitality industry. We find that actors' definition of family depends on the context of family firms and impacts their motivation to internationalize.