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Western cultural influence on corporate innovation: Evidence from Chinese listed companies

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  • Li, Guoxing
  • Yeh, Yin-Hua

Abstract

This study presents robust findings that Western cultural influence, as measured by Starbucks stores, significantly improves corporate innovation outcomes at nearby Chinese listed firms. These outcomes are generated by risk-taking in research and development investment, more aggressive CEO compensation packages, and tougher intellectual property protection. Our results show greater significance in areas where local cultural influence is less, industries are highly competitive, and non-state-owned enterprises are less prevalent. We generate insights into the cumulative and the incremental impact of Western cultural influence on firm innovation using yearly data on the number of Starbucks stores and new store openings within a given area.

Suggested Citation

  • Li, Guoxing & Yeh, Yin-Hua, 2023. "Western cultural influence on corporate innovation: Evidence from Chinese listed companies," Global Finance Journal, Elsevier, vol. 55(C).
    • Handle: RePEc:eee:glofin:v:55:y:2023:i:c:s1044028323000054
    DOI: 10.1016/j.gfj.2023.100810
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    More about this item

    Keywords

    Western culture; Corporate innovation; Confucian culture;
    All these keywords.

    JEL classification:

    • D23 - Microeconomics - - Production and Organizations - - - Organizational Behavior; Transaction Costs; Property Rights
    • O31 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Innovation and Invention: Processes and Incentives
    • Z13 - Other Special Topics - - Cultural Economics - - - Economic Sociology; Economic Anthropology; Language; Social and Economic Stratification

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