Language distance and international acquisitions

Vidal-Suárez, Marta M.; López-Duarte, Cristina

doi:10.1177/1470595812452634

Cited by 16 publications

(12 citation statements)

References 41 publications

(68 reference statements)

Supporting

Mentioning

Contrasting

Order By: Relevance

“…This measure is widely used in the literature (Dow and Larimo, ). Consistently, we only consider those studies for our analysis that apply this measure (e.g., Vidal‐Suárez and López‐Duarte, ).…”

Section: Methodsmentioning

confidence: 99%

Which Resources Matter How and Where? A Meta‐Analysis on Firms’ Foreign Establishment Mode Choice

Klier

Schwens

Zapkau

et al. 2016

J Management Studies

View full text Add to dashboard Cite

Firm resources play an important role in explaining the foreign establishment mode choice. However, a theoretical framework that simultaneously a) differentiates between heterogeneous types of resources, b) provides a rationale that consistently explains how firms adapt their establishment mode choice to their resource base, and c) reflects on contextual factors that intervene in the consistency of the direct relationships is largely missing. The present paper draws on the resource‐based view (RBV) to develop such a framework. More specifically, we study the effect of knowledge‐based and experience‐based resources on a firm's establishment mode choice and the moderating impact of cultural distance on these relationships. We validate our theoretical framework by a meta‐analysis (integrating 31 studies with 13,559 establishment mode choices) and find that knowledge‐based resources enhance a firm's propensity for greenfield investments, while experience‐based resources more likely lead to acquisitions. Further, cultural distance increases knowledge‐intensive firms’ preference for greenfield investments.

show abstract

Section: Methodsmentioning

confidence: 99%

Which Resources Matter How and Where? A Meta‐Analysis on Firms’ Foreign Establishment Mode Choice

Klier

Schwens

Zapkau

et al. 2016

J Management Studies

View full text Add to dashboard Cite

show abstract

“…Language barriers hinder communication and information flow, which may lead to frustration, conflict, mistrust, and resistance (Vidal-Suárez & López-Duarte, 2013). Such issues can be triggered by language as a source of exclusion, power and identity.…”

Section: The Role Of Language In International Business and Internatimentioning

confidence: 99%

“…This is an important research gap as the literature has established that language difference (LD) creates barriers for communication, disturbs information flow and knowledge transfer, influences HQ-subsidiary and inter-subsidiary relationships particularly from the aspect of control, communication and coordination, and affects foreign direct investment (FDI) (e.g. Björkman & Piekkari, 2009;Cuypers et al, 2015;Harzing & Feely, 2008;Konara & Wei, 2019;Lauring & Klitmoller, 2015;Ly et al, 2018;Schomaker & Zaheer, 2014;Vaara et al, 2005;Vidal-Suárez & López-Duarte, 2013;Welch & Welch, 2008;Zhu et al, 2015). Arguably, all of these effects can be reflected in organizational performance.…”

Section: Introductionmentioning

confidence: 99%

Does language matter to foreign subsidiary performance?

Konara

Wei

2020

IMR

View full text Add to dashboard Cite

PurposeThis paper examines the role of language in foreign subsidiary performance.Design/methodology/approachWe develop hypotheses relating to the effects of language difference and its interplay with cultural distance and market size. Considering languages that can be directly used and that can be acquired by MNEs, we employ language variables representing major languages and a population of 60 home and 57 host countries to study the performance of a sample of 1,751 subsidiaries between 2002 and 2013.FindingsLanguage difference is found to have a negative impact on subsidiary performance. The positive effects of cultural distance on performance become stronger when the language difference is smaller. The language effects are also more pronounced in small markets.Practical implicationsThis study reveals that subsidiary success depends on language difference, and such effects are more pronounced in small markets. The results also suggest that MNEs need to give more attention to bridging language barriers when they invest in culturally distant countries so that they can benefit from the positive effects of cultural distance.Originality/valueGiven that there is no systematic research investigating the role of language in the foreign subsidiary performance of MNEs, we make an important contribution by presenting a quantitative investigation of the language–performance relationship. The novelty of the paper also lies in examining the interplay of language difference with cultural distance and market size.

show abstract

“…The literature shows that a shared identity fosters trust, communication, and a shared understanding. Social identity theory further suggests that clustering or formation of in‐groups results in members of a group finding ways to distinguish themselves and to degrade or dominate out‐groups (Barner‐Rasmussen & Bjorkman, ; Lauring, ; Vidal‐Suarez & Lopez‐Duarte, ). These researchers argue that individuals sharing a language are more likely to share the same norms, rules, perceptions, and values, which, as a result, will increase trust among them.…”

Section: Conceptual Approachmentioning

confidence: 99%

Social identity in MNCs based on language and nationality

Wöcke¹,

Grosse

Stacey

et al. 2017

Thunderbird Intl Bus Rev

View full text Add to dashboard Cite

The existence of multiple languages in a multinational corporation (MNC) causes tensions in the firm both by causing problems in communicating and by creating social groups. MNCs that adopt a common corporate language that is not their home language will find a problem of competing languages. Nationality is another cultural feature that leads to perceived biases that favor home-country nationals. We explore both of these influences using social identity theory.Our research was conducted in a Spanish MNC that has subsidiaries in 42 countries and has adopted English as its corporate language. We used a mixed-method approach with a mailed survey of 216 managers across 42 subsidiaries in the MNC and personal interviews of headquarters executives. We found that Spanish speakers enjoyed advantages in terms of access to resources for themselves and their subsidiaries, relative to non-Spanish speakers. This access was greater when the Spanish speakers were Spanish nationals and was moderated by geographic proximity of the subsidiary to the headquarters and age of the subsidiary. K E Y W O R D Scorporate language, headquarters-subsidiary relationship, in-company resource allocation, language and IB, social identity

show abstract

Language distance and international acquisitions

Cited by 16 publications

References 41 publications

Which Resources Matter How and Where? A Meta‐Analysis on Firms’ Foreign Establishment Mode Choice

Which Resources Matter How and Where? A Meta‐Analysis on Firms’ Foreign Establishment Mode Choice

Does language matter to foreign subsidiary performance?

Social identity in MNCs based on language and nationality

Contact Info

Product

Resources

About