Does family businesses promote regional common prosperity? Evidence from Chinese employment stickiness

Family businesses play an important role in the Chinese economic system, but there are still doubts about how they can undertake the mechanism of regional common prosperity. This study initiates with an examination of internal production and employs A-share private listed companies from 2010 to 2023 as samples to empirically assess the impact of family businesses on regional common prosperity using a two-way fixed effects model. The findings suggest that family businesses can significantly enhance the level of common prosperity in a region by narrowing the gap in employee labor compensation and fostering long-term employment commitments. Further analysis indicates that in the high-tech industry, family businesses play a more substantial role in advancing regional common prosperity, particularly in the Jiangsu and Zhejiang regions. Additionally, when family businesses refrain from merely engaging in symbolic short-term actions such as social donations and targeted poverty alleviation, their contribution to regional common prosperity is even more pronounced. The conclusion clearly outlines the pathway through which family businesses contribute to regional common prosperity, offering a theoretical foundation for encouraging family businesses to better foster local common prosperity.