How much distance do we need? Revisiting the “National cultural distance paradox”

Huanglin Wang and Jean-Louis Schaan
Additional contact information
Huanglin Wang: University of Western Ontario
Jean-Louis Schaan: University of Western Ontario

Management International Review, 2008, vol. 48, issue 3, No 1, 263-278

Abstract: Abstract Abstract and Key Results This study revisits the “national cultural distance paradox” based on a sample of Japanese foreign direct investment (FDI) in 53 countries and regions over 30 years. Earlier studies on cultural distance assumed linear relationships and showed mixed results. We examine nonlinear relationships between cultural distance (CD) and entry mode and between CD and performance. Results suggest that there is a nonlinear (inverted U-shape) relationship between CD and the choice of a joint venture as the preferred market entry mode, and between CD and performance. We also found that the relationship between CD and performance is moderated by entry mode choice: the nonlinear relationship between CD and performance is stronger for joint ventures than for wholly owned subsidiaries.

Keywords: Cultural Distance; Entry Mode; Performance; Multinationals; National Cultural Distance Paradox; Logistic Regression (search for similar items in EconPapers)
Date: 2008
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (18)

Downloads: (external link)
http://link.springer.com/10.1007/s11575-008-0015-y Abstract (text/html)
Access to the full text of the articles in this series is restricted.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:spr:manint:v:48:y:2008:i:3:d:10.1007_s11575-008-0015-y

Ordering information: This journal article can be ordered from
http://www.springer.com/journal/11575

DOI: 10.1007/s11575-008-0015-y

Access Statistics for this article

Management International Review is currently edited by Michael-Jörg Oesterle and Joachim Wolf

More articles in Management International Review from Springer
Bibliographic data for series maintained by Sonal Shukla () and Springer Nature Abstracting and Indexing ().