The Curvilinear Impact of Cultural Friction on Foreign Divestment

IF 3.9 3区 管理学 Q2 MANAGEMENT
Ha Nguyen, Jorma Larimo, Douglas Dow
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Abstract

International business scholars have long recognized the potential influence of cultural differences on foreign divestment; however, the empirical results are mixed. Our study helps resolve this contradiction and contribute to the existing literature in three ways. First, we advocate the use of cultural friction metric, instead of the more traditional cultural distance approach. This overcomes a key limitation in the modelling the impact of cultural differences. The friction construct metric includes an index of firm-specific factors, referred to as the degree of ‘cultural interaction’. This index moderates the impact of cultural distance, reflecting firm—level differences. We also build on calls for more Positive Organizational Scholarship by challenging the negative bias in the international business literature and propose a curvilinear effect of cultural differences on divestment probability. Lastly, we investigate a potential boundary condition—the moderating effect of entry mode on the main hypothesis. Our empirical sample include 2120 Finnish foreign subsidiaries operating in 40 countries during 1970–2010. Our analyses confirm that the cultural differences, when measured by the friction metric, appear to be a significant and superior predictor of subsidiary divestment probability, and that the relationship appears to be U-shaped. Our robustness analyses also highlight the importance of which cultural framework is applied and controlling for selection bias.

Abstract Image

文化摩擦对撤资的曲线影响
国际商业学者早已认识到文化差异对外国撤资的潜在影响;然而,实证结果却喜忧参半。我们的研究有助于解决这一矛盾,并在三个方面为现有文献做出贡献。首先,我们提倡使用文化摩擦指标,而不是传统的文化距离方法。这克服了文化差异影响建模中的一个关键局限。摩擦构造度量包括企业特定因素指数,即 "文化互动 "程度。该指数可调节文化距离的影响,反映企业层面的差异。我们还通过质疑国际商业文献中的负面偏见,提出了文化差异对撤资概率的曲线影响,从而呼吁更多的积极组织学术研究。最后,我们研究了一个潜在的边界条件--进入模式对主要假设的调节作用。我们的实证样本包括 1970-2010 年间在 40 个国家运营的 2120 家芬兰海外子公司。我们的分析证实,用摩擦指标衡量的文化差异似乎是预测子公司撤资概率的一个重要且优越的指标,而且这种关系似乎呈 U 型。我们的稳健性分析还强调了采用哪种文化框架以及控制选择偏差的重要性。
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来源期刊
CiteScore
6.50
自引率
11.60%
发文量
34
期刊介绍: Management International Review publishes research-based articles that reflect significant advances in the key areas of International Management. Its target audience consists of scholars in International Business Administration. Management International Review is a double-blind refereed journal that aims at the advancement and dissemination of research in the fields of International Management. The scope of the journal comprises International Business, Cross-Cultural Management, and Comparative Management. The journal publishes research that builds or extends International Management theory so that it can contribute to International Management practice. Management International Review welcomes both theoretical and empirical work. Original papers are invited that are based on a solid theoretical basis and a rigorous methodology. In the area of empirical studies, the journal publishes both quantitative and qualitative research. To be published in Management International Review, a paper must make strong contributions and highlight the significance of those contributions to the field of International Management. The editors are especially interested in manuscripts that break new ground rather than papers that make only incremental contributions. Management International Review publishes articles and research notes. Every year, six issues are published. On average, two of these issues are Focused Issues, which concentrate on a specific subfield of International Management.
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