More than just national cultural distance: Testing new distance scales on FDI in Slovakia

Dow, Douglas; Ferenčíková, Sonia

doi:10.1016/j.ibusrev.2009.11.001

Cited by 104 publications

(72 citation statements)

References 45 publications

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“…Selecting the most recent INVC processes minimized this recall error, but it may nevertheless have still been present. By explicitly pointing out in the item formulation that the entrepreneur may know more after the internationalization process, we tried to relieve the pressure to act in a potentially socially desirable way by understating psychic distance (Dow and Ferencikova 2010). A final shortcoming is the low reliability of the "affordable loss" and "dynamism" variables.…”

Section: Resultsmentioning

confidence: 99%

Antecedents and consequences of effectuation and causation in the international new venture creation process

2012

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The selection of the entry mode in an international market is of key importance for the venture. A process-based perspective on entry mode selection can add to the International Business and International Entrepreneurship literature. Framing the international market entry as an entrepreneurial process, this paper analyzes the antecedents and consequences of causation and effectuation in the entry mode selection. For the analysis, regression-based techniques were used on a sample of 65 gazelles. The results indicate that experienced entrepreneurs tend to apply effectuation rather than causation, while uncertainty does not have a systematic influence. Entrepreneurs using causation-based international new venture creation processes tend to engage in export-type entry modes, while effectuation-based international new venture creation processes do not predetermine the entry mode.

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Section: Resultsmentioning

confidence: 99%

Antecedents and consequences of effectuation and causation in the international new venture creation process

2012

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“…Moreover, we refrained from using the Euclidean approach since we have no theoretical reason to assume that some dimensions of cultural distance are more important than others (Vermeulen & Barkema, 2001). Overall, we believe that the Kogut and Singh (1988) index adequately captures distances between countries as evidenced by numerous previous studies that had relied on this calculation method in combination with Hofstede's metrics in IB research (Barkema et al, 1996;Barkema & Vermeulen, 1997;Benito & Gripsrud, 1992;Chan & Makino, 2007;Cho & Padmanabhan, 2005;Dow & Ferencikova, 2010;Morosini et al, 1998;Yiu & Makino, 2002).…”

Section: Moderating Variablementioning

confidence: 72%

“…Consequently, we believe that Hofstede's metrics still capture important cultural differences as evidenced by the large number of empirical studies that have used his data in IB research (Barkema, Bell, & Pennings, 1996;Barkema & Vermeulen, 1997;Benito & Gripsrud, 1992;Chan & Makino, 2007;Cho & Padmanabhan, 2005;Dow & Ferencikova, 2010;Morosini et al, 1998;Yiu & Makino, 2002). However, as reported below, we conducted tests with other measures of cultural distance as robustness checks (see analyses section), all pointing in the same direction.…”

Section: Moderating Variablementioning

confidence: 98%

Ownership mode, cultural distance, and the extent of parent firms’ strategic control over subsidiaries in the PRC

et al. 2016

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Previous studies often associated a specific type of ownership mode with the extent of control a parent firm may have over (strategic) decision-making in a foreign subsidiary, suggesting that parent firms should have higher control over wholly-owned subsidiaries (WoS) than international joint ventures (IJVs). Building on principal agent theory, we argue that in the Chinese context higher ownership levels do not necessarily have a positive effect on the extent of control over the foreign subsidiary. We further argue that cultural distance between the parent firm and the subsidiary moderates this relationship. We test our hypotheses using data from a sample of 156 foreign subsidiaries in the People's Republic of China (PRC) and find strong support for our arguments. Our findings show that in WoS parent firms reduce their extent of control, while in IJVs parent firms increase their extent of control. Moreover, we find that extent of control over WoS (IJVs) declines (increases) when cultural distance increases. Our results have significant theoretical implications for international business (IB) research as they challenge existing views with regard to the relationship between ownership mode and control as well as the moderating effect of cultural distance.

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“…Several studies were dedicated to FDI issues in CEE countries (Dudáš, Lukáč 2014;Gauselmann et al 2011;Rybář 2011;Dow, Ferenčíková 2010;Chidlow et al 2009;Fifeková 2008;Pavlínek 2002;Rugraff 2008;Zajac, Baláž 2007;Fisher et al 2007;Giroud 2007;Fabry, Zeghni 2006;Ferenčíková, Dudáš 2005;Bevan, Estrin 2004;Beyer 2002;Barrell, Holland 2000).…”

Section: Resultsmentioning

confidence: 99%

“…The positive effect of FDI on the economic growth is an accepted fact in CEE countries (Ferenčíková, Dudáš 2005). Dow and Ferenčíková (2010) directed their research to the specific FDI issues to Slovakia. An impact of FDI on Slovak economy also analyzed Hošková (2001), indirect effects of FDI commonly referred to as spillovers and its potential in Slovakia defined Fifeková (2008).…”

Section: Theory and Literature Reviewmentioning

confidence: 99%

Business Performance Management and Fdi: Key Differences Between Foreign and Domestic-Owned Firms – A Case of Slovakia

Rajnoha

Merková

Dobrovič

et al. 2018

Journal of Business Economics and Management

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Abstract. The empirical study defines typical investment behaviour of foreign-owned firms against local firms and highlights benefits and any discrepancies of foreign capital. The paper focuses on industrial enterprises in Slovakia mainly from the automotive, engineering and wood-processing industry (N = 164). Results show the significant dependence of foreign ownership and better business performance compared with domestic firms. The performance was expressed through ROE indicator. Enterprises with the foreign participation of property achieve better performance, most typically with ROE above 10% (p-value < 0.05). The better performance, as well as distinctive feature of intangibles and research & development investments, are typically in foreign-owned firms. Intangibles and R&D as crucial investments do not directly cause better business performance in foreign-owned firms, and we discuss the reasons. The research results offer relevant and interesting implications for managers behaviour, also public authorities as well as motives for further investigation of the business performance management and foreign direct investment issues.

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More than just national cultural distance: Testing new distance scales on FDI in Slovakia

Cited by 104 publications

References 45 publications

Antecedents and consequences of effectuation and causation in the international new venture creation process

Antecedents and consequences of effectuation and causation in the international new venture creation process

Ownership mode, cultural distance, and the extent of parent firms’ strategic control over subsidiaries in the PRC

Business Performance Management and Fdi: Key Differences Between Foreign and Domestic-Owned Firms – A Case of Slovakia

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