Abstract
The principal–agent theory asserts that public firms’ performance is driven by efficient capital and labor markets but is silent about non-listed private companies, which are less permeable to market forces (both capital and labor) than are public companies. We propose and test a 2 × 2 framework distinguishing owner-controlled vs. agent-led firms from firms with a flat vs.multilayer organization. Our findings provide highly contrasted results and raise important issues for further study of private firms.