Research Notes and Commentaries
Cultural distance, investment flow, and control in cross-border cooperation
Article first published online: 14 APR 2008
Copyright © 2008 John Wiley & Sons, Ltd.
Strategic Management Journal
Volume 29, Issue 10, pages 1117–1125, October 2008
How to Cite
Lee, S.-H., Shenkar, O. and Li, J. (2008), Cultural distance, investment flow, and control in cross-border cooperation. Strat. Mgmt. J., 29: 1117–1125. doi: 10.1002/smj.685
- Issue published online: 30 AUG 2008
- Article first published online: 14 APR 2008
- Manuscript Revised: 8 JAN 2008
- Manuscript Received: 6 SEP 2005
- cultural distance;
- direction of investment
Previous research analyzing the impact of cultural distance on joint venture negotiations has often confounded firm and environment effects. To decouple these effects, the cross-border cooperation preferences of small and medium-sized Korean firms were studied, considering simultaneously firms involved in inward and outward investment ventures. While cultural distance showed no significant relationship with the degree of control sought over the cooperative ventures, cultural distance was significantly related with a preference for ventures in domestic or foreign markets. The impact of cultural distance was found to be greater in inward investment than in outward investment. Copyright © 2008 John Wiley & Sons, Ltd.