Abstract: We examine how family ownership shapes firm responses to employee health shocks using Dutch matched employer–employee administrative data. Following a health shock, family firm employees experience 2% higher annual earnings losses at the overall and intensive margin. This effect is driven by reduced working hours and wage adjustments and is more pronounced among female, younger, geographically distant workers, and low-earning workers. At the extensive margin, family firm employees are less likely to switch employers, but conditional on switching, do so later and disproportionately switch to other family firms. Eight complementary tests, including on monthly employment records, relocation patterns, and hand-collected survey evidence, suggest that these effects reflect employee-driven flexibility rather than employer exploitation. Results persist when exploiting within-firm ownership changes and restricting to exogenous health conditions. Overall, our results suggest that family firms provide implicit insurance through accommodation, though employees absorb income losses.

 

 

About Jeroen Verbouw

Jeroen Verbouw is an Assistant Professor in Entrepreneurial Finance at IE Business School. He graduated with a joint Ph.D. from Tilburg University, the Netherlands, with a PhD in Finance, and Ghent University, Belgium, with a PhD in Business Economics, and was a visiting researcher at Columbia Business School. In a first strand of research, he examines entrepreneurial finance, with a focus on the strategic interactions between investors and founders, from the perspectives of the entrepreneurs, investors, and their stakeholders. Moreover, he studies venture-level implications of investor type heterogeneity, of interactions between different investor types, and how investors exactly make investment decisions. He is also interested in strategic ownership, more specifically, how firm ownership shapes strategic and investment decisions, such as in their workforce or social behavior. Jeroen's work has been published in the Strategic Entrepreneurship Journal. His research has received the 2025 Best Dissertation Award from Private Capital Belgium and multiple top paper awards. He teaches Entrepreneurial Finance and Entrepreneurship, for which he was recognized with the 2025 Teaching Excellence Award at IE Business School.